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ETF Investing: Here’s why small-cap stocks could be vulnerable to ETF outflows

Exchange-traded funds are among the most popular ways for investors to get exposure to nearly any asset class, region, or strategy in global financial markets. However, rather than providing safety in numbers, this could become a risk factor for some assets.

The question of whether the massive growth in ETFs is something to be feared has been hotly debated for years, as investors increasingly adopt the investment vehicle and dump old-school alternatives like actively managed mutual funds, which typically charge more and deliver inferior long-term results.

Read: Active managers to passive funds: let’s be friends

ETFs hold baskets of securities like mutual funds, but trade intraday like stocks.

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