Its March And My Wife Is Mad

Seton Hall and Wichita State just tipped off to start the tourney, wahoo!

This is a bone of contention in our house every year. The Wall Street Journal may have found a bone of contention in iShares' house with the way they calculate P/E ratios for their funds. You can read about this on ETF Investor, Accidental Consultant or in the original WSJ article.

Accidental calls this deceitful. While I'm not sure if they intend to deceive or not it certainly is not helpful. The article focuses on the market cap ETFs. The iShares I use in my practice are the occasional single country ETF and some sector ETFs for clients where individual stocks are not ideal. The article did not touch on these ETFs so I don't know if they are effected.

Where this is problematic is in choosing what ETF to use to capture whatever effect you are going for. If you want broad small cap exposure in an ETF you only have a few choices. The likelihood that you get hurt because the iShares P/E ratio is higher than you thought is quite slim but it is discomforting nonetheless. I have a nickel that says this changes very soon.