CDOs and ETFs are different animals. The Burry logic is that when people are investing in ETFs, money is pouring into stocks "without any valuation or thought about liquidity" - money is been invested blindly - simply because a stock is part of an index. This is 'similar' to what happened with CDOs - money been put into instruments that are opaque and very illiquid. This isn't true, because Active investing is still roughly 50% of overall investments - so there is enough pressure on valuation as well as liquidity. Jack Bogle has acknowledged that 'at some threshold' passive investing may change the nature of markets - but that percentage is more like 70 to 90%. We're far from there.

Yes, just note that SSB is not immediately available to you, so factor in 1 month lag. It means you can keep 2 months of emergency in really liquid form, and the next 4months in SSB, and withdraw as you need every month.

Hello, Volatility is a characteristic that statistician's can measure - it is nothing but the degree of movement of a stock's price. More volatile stocks have larger movement in their prices 'generally'. Typical stocks would be around 15% annual volatility. It means that based on past observations over a long period of time, it is observed that frequently, price of a particular stock could rise/drop by 15% in a year (this is a One standard deviation move in math-speak). It just reflects history, and doesn't mean that the price wont rise or fall by more than 15%. If you buy a stock today, and never check the price of the stock for another year, this volatility makes no difference to you. You will simply look at purchase price, and price at the moment and calculate the return. The trouble starts when you use volatility as a measurement of 'risk'. Most people do that, because there is no way to measure "risk of permanent loss" -which is the real risk everyone is worried about. So volatility is a convenient measure, but not an accurate one. We're basically saying "if a stock has high volatility, it can really zig zag - and if it goes down too much, the investor will get scared, and sell at a low price to recover atleast part of the investment". So - high volatility is mistakenly thought of as 'high risk' - but it serves the purpose of some investors and advisors. Back to your question - seeking higher 'risk' is the wrong way to think about higher return. Just because you sought higher risk stocks doesn't mean they will give you higher return - they could be volatile simply because of political reasons or due to currency fluctuations. You should evaluate good stocks/ETFs, and then assess if their volatility is acceptable to you. Think of two choices - you want to go from A to B, and there is either a meandering but safe road, or a roller-coaster to reach there. The roller-coaster might take you there faster, but you might fall sick on the way, or it might break down and you'll never reach there. The meandering but safe road also has a higher probability to get you there, but of course, doesn't guarantee it. You have to choose what you road you want to take based on your life situation and goals. Sometimes, people reach point B from both roads, but in investing, the one who took less risk for the same return is considered a better money manager. This is measured by comparing risk-adjusted return - also called Sharpe Ratio. Hope this helps.

Is this a trick question??!! The index itself is either a Net Return Index(dividends paid out) or Total Return Index(dividends reinvested). So your ETF will track the relevant index...and there will be a tracking error associated with it. All this information is mentioned in the fact sheet of the etf.

Press the Start button?! You seem to have decide on the 3 types of funds. Decide the Exchange you want to build this on, Decide the best broker for that Exchange. Choose the 3 ETFs on that Exchange Sign up with the broker Transfer Money Buy Monitor, Manage.

A good portfolio is one that has the highest probablity of achieving your objective for setting it up. Therefore, objective comes first. Then the amount invested. Then the asset selection, then the asset allocation. Then the discipline to carry through the plan...and change the portfolio if conditions demand. Portfolios are good only until they are....then they are not!

- There is no real passive investing, unless you buy all the markets in the world in their current weights. As soon as you buy an ETF, you're taking an active view. For example, if you buy an ETF tracking S&P500 - you're already taking a view that you want to own the largest 500 companies in the US by market capitalization. This is one definition of active/passive - that you have a view or not, about the future returns. - If you buy a 'passive ETF' it is simply tracking the index and not trying to beat the index. If you buy an 'active ETF' they're trying to beat an index using maybe a factor like Value or Momentum. - You can then also mix and match passive and active ETFs, and rotate between ETFs based on certain criteria )for example, people rotate between sectors based on momentum) -thats been an active inveestor (using passive ETFs usually). So you see, these are quite misused terms ! what you should do depends on your skill levels, and return requirements. This is not easy, and it takes time. If you have neither, then a set of diversified active/passive ETFs that are rebalanced infrequently is probably the most convenient choice.

This is not an either-or. You can have a core, passive ETF portfolio,and use active management for asset classes that you don't really know much about, or for markets that need a lot of local know-how. Bonds can be one area, some EM markets, specialized commodities, and crash protection strategies, where active management can add to gains. Picking a fund manager (and evaluating his performance) also needs a lot of knowledge, so personal time and effort is a basic prerequisite for both options. ETFs have put a lot of pressure on active management fees, so its not that bad now - but you should totally avoid any "sales charges", and paying more than 1%. Bear in mind that you have to look at fees also from the point of view of the asset class and market the fund is invested in - some markets just have more taxes, wider bid-ask spreads, and less liquidity and therefore cost more, so can't blame the fund manager or the active ETF for higher costs.

Stay away from the FA

Options are highly advanced instruments. If you are just starting off on investing, do not think of options as an alternative to stock/forex trading - learn the basics first- stocks or forex trading. You need atleast some mathematics strength to really understand them. They're amplifiers - they can magnify gains and losses both! There is no 'good' or 'bad' product - only less dangerous and more dangerous.