But if you’re more of an active investor trading in a taxable brokerage account, it’s worth understanding how an ETF’s liquidity could impact your strategy.įunds with higher average trading volumes are more liquid, and ones with lower trading volumes are less. Hands-off, buy-and-hold retirement investors don’t need to worry terribly much about ETF liquidity. In cases where expense ratios are higher, check to see if the fund’s performance justifies the higher management fee. Taken together, S&P 500 expense ratios, or the fees charged by funds to cover their operating expenses, are very low. In addition, S&P 500 ETFs are among the largest ETFs by assets with some of the biggest trading volumes in the industry. Expense Ratiosīoth passively managed and active ETFs exist-but most S&P 500 ETFs are passively managed by definition. Here are the key points to compare between potential S&P 500 ETFs before you invest.