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ETFs for the retiring type: Report
Paper says exchange traded funds, once shunned because of fees, now being worked into 401(k)s.
October 17, 2005: 11:01 AM EDT
The TurnAround

NEW YORK (CNN/Money) - Brokerages are trying to work exchange traded funds, often kept out of retirement plans because of the trading fee, into 401(k)s aimed at small business, a report said Monday.

The strategy entails bundling trades from many employees and many business together into weekly purchases, according to the Wall Street Journal.

ETF's are index-tracking mutual funds that are bought and sold by a broker and traded all day on an exchange, similar to stocks.

They are favored for their tax advantages and lower maintenence fees but their trade fees have kept them out of retirement plans like 401(k)s where investors make weekly contributions, according to the Journal.

The report said the strategy of bundling purchases together can result in automatic investments for as little as $1 to $4 a trade.

Sharebuilder Securities, Invest n Retire, Banneker Capitol Management and Fulcrum Financial are among the companies offering ETF-based 401(k) platforms, according to the Journal.

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