I recently read an article in the Los Angeles Times that basically argued that most investors don’t understand ETFs. The article cited a survey by Chicago market research firm Mintel that showed more than 60% of investors don’t buy ETFs because they “don’t know what they are.”

Now, as a big advocate of using ETFs, I really have a hard time understanding how so many people don’t understand ETFs. I mean, are ETFs really too complicated for investors to understand? Granted, some of the more obscure leveraged ETFs can be a bit confusing, as some don’t precisely track the performance of their underlying index. But those ETFs are the rare exception.

I trust that if a survey was conducted of Alert readers, the percentage of those who say they don’t know what ETFs are would be almost zero. That’s because there is nothing really difficult to understand about ETFs. Just think of them as a basket of stocks, bonds or commodities tied to a specific market index or sector index. They trade on exchanges the way stocks do, and they usually have extremely low expense ratios. That’s about all you really need to understand with ETFs.

Hey, the way I see it, investing is a hard enough endeavor to get right without worrying about the complexity of a simple investment vehicle. So whatever you do, don’t be confused by the chatter. ETFs are simple, efficient and cost-effective tools that investors can use to get their money exposed to the market. Enough said.