By Brendan Conway

Heres a synopsis of the articles in this weekends Barrons ETF Special Report. with links to the full stories.

Can ETFs be Derailed?

In the cover story, Barrons staff writer Jonathan R. Laing surveys the ways in which the details of the ETF market might one day trip up investors. Laing reviews how funds for less trodden assets (and overseas markets which are closed during U.S. hours) such as iShares MSCI Philippines  (EPHE ) and SPDR Nuveen S&P High Yield Municipal Bond  (HYMB ) sometimes stray from the value of the underlying assets which themselves are tricky to price, since they often dont change hands as frequently as an easy-to-trade ETF. Laing also reviews the tendency of ETFs to drive stock prices in certain cases, the surprising inefficiencies which can be spotted in ETFs arbitrage pricing, the trust investors place on so-called authorized participants to keep prices fresh and accurate, and ETFs special vulnerability to market breakdowns such as the 2010 flash crash.

Carl Weins for Barrons

Now All the Cool Kids are Filing for ETFs

Mutual-fund giant American Funds has asked regulators permission to build actively managed ETFs. Its a big deal: American Funds runs eight of the 20 largest mutual funds which means the $1 trillion firm is one of the most conspicuous holdouts of the ETF revolution. Sarah Max  of Barrons  reviews the reasons  parent Capital Group  is unlikely to clone the $143 billion Growth Fund of America  (AGTHX ) in ETF form, but why fresher, more focused versions of existing strategies, a la Bill Gross Pimco Total Return ETF  (BOND ), are entirely possible.

Beware Bank-Loan ETFs

Your blogger recounts the controversy this year over a specific type of fund: Bank- loan ETFs, where industry leaders like BlackRock (BLK) and Vanguard Group have publicly warned off investors. Its true that bank loans are trickier to trade than stocks and bonds, meaning they pose special challenges to package as easy-to-trade ETFs. This, in turn, has spurred fears of malfunctions in the event of a large selloff. I argue that, in spite of the differences, the controversy is overblown. Bank-loan ETFs are not qualitatively different from predecessor mutual funds, and none of those predecessors blew up in the financial crisis. At the same time, the asset class should be treated with caution: It may not respond as well to rising interest rates as investors think, and you could pay a steep price if you want to exit your investment amid a panic. Relevant tickers include PowerShares Senior Loan Portfolio  (BKLN ), SPDR Blackstone/GSO Senior Loan ETF (SRLN ) and Eaton Vance Floating Rate  (EVBLX ).

ETF Managed Portfolios: What to Watch

Your bloggers other story in the section features a fast-growing outsourcing trend: The rise of so-called ETF managed portfolios. The strategists behind them are like super-advisors, having found favor among harried financial advisors who choose to send the day-to-day tasks of portfolio construction and management to an outside specialist. Used properly, these strategies can be a big leap forward in terms of pursuing a specific investing goal, such as lower portfolio volatility or the highest income at the lowest risk. The trouble is, these managers charge fees, too, and theyre not infallible. The story reviews the complexity of some of the most successful strategies, plus the unwanted publicity for investors in the Good Harbor Tactical Core U.S. strategy, and a regulatory probe of the fields bigger player, F-Squared Investments .

Checking Up on Fidelitys New ETFs

Fidelity Investments new ETFs should appeal to sector rotators, especially the ones who are already Fidelity clients. What about the rest of us? Lewis Braham checks up on the progress of the Boston giant as it eyes the ETF market, where historically its been a laggard. See how Fidelity MSCI Health Care Index ETF (FHLC) stacks up against the better-known Health Care Select Sector SPDR  (XLV).

The Vanguard Paradox

Even for skinflint ETF users, theres often a case for active management. Lewis Braham  shows how   Vanguard Health Care  fund (VGHCX ) has managed to beat the popular iShares U.S. Healthcare ETF  (IYH ) over the long haul, in much the same way the actively managed Vanguard Dividend Growth  (VDIGX ) has outpaced the passive Vanguard Dividend Appreciation ETF  (VIG ). The secret: Combining excellent management with especially low costs.

Fund Investing: Hire a Great Manager, or Go for Low Costs? Next

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