ETF Trading… Indices, Sectors and more…
Dear ETF Traders,
Yesterday we looked at what an ETF is and how it functions. We covered how they are traded and even what each player has to gain.
If you are anything like me you see that ETFs are definitely something that you need to check out.
One of the BIG advantages is that ETFs eliminate much of the “single company risk”. Because ETFs are based on baskets… should any single stock get into trouble, the damage to the overall basket is minimized.
That is one reason why I suggest diversification. Oil and Airlines for example. When one goes up, the other goes down. You can be safely tucked in between.
Another good idea would be to hold sector ETFs, you can get them for just about any sector that you can imagine from Transports to Alternative Energy… from The Japan ETF to the Australian Dollar.
There is an ETF for just about any asset class you can think of.
For the more adventurous among you there are even leveraged ETFs, but we don’t want to get into those just yet.
In fact ETFs have become such a big part of the market that we built an ETF Dashboard for our Research lab because it helps us watch the whole market with far fewer symbols.
We can watch world markets, currencies, commodities, indices, sectors and more just by looking at the ETFs.
One thing I have discovered is that ETFs seem less volatile that indices or individual; stocks, especially at the market open. This is another big advantage for you.
If you download the Market Toolbox (it’s free) you can see our whole ETF Research Center in the Finance Portal.
We also have lists and information on World ETFs, Index ETFs, Industry ETFs and a directory of Leveraged ETFs.
There are ETF Screeners and a whole bunch of additional resources.
Download the Toolbox, install it, read the welcome page, then go to the Free Finance Portal Section. On the left will be a link to the “ETF Center” Enjoy!
In tomorrows E-mail we’ll look at the Trading System that seems custom made for ETF investing.
This 31 year old formula is now so powerful and sensible that it is really amazing that people do not talk about it more.
We’ll look at the overall strategy, and the tactics of the system. We’ll show you how to select ETFs for the system.. and when NOT to use it.
Do not miss tomorrows e-mail and we’ll see you at the LIVE event in 2 days.
Best wishes and good investing
Doug Newberry
Investing Systems Inc.
