By Ahmad A Hassam
One of the most revolutionary financial innovation that took place in the last decade of 20th century is the development of Exchange Traded Funds (ETFs). ETFs have completely changed the landscape of the world of investing. ETFs give you all the advantages of investing in stocks and mutual funds with none of their disadvantages. Read this article to know how ETFs can change your fortunes in 2010!
So what makes ETFs superior to stocks and mutual funds. You see, when you invest in a few stocks, your portfolio is not hedged. This is why most of the people invest in mutual funds that give them diversification. But mutual fund shares can only be sold or bought at the end of the day when the mutual fund NAV (Net Asset Value) is calculated. The next day when the trading starts, the market might have changes and this NAV may already be stale. But you cannot dump the mutual fund shares. Mutual funds also come with front end and back end fees known as loads plus management fees. So what to do, invest in ETFs. ETFs trade just like stocks,you can buy or sell ETF shares anytime of the day. You can go short on ETF shares anytime unlike stocks that have the uptick rule preventing shorting. At the same time, an ETF provides you with the advantages of a mutual fund. Yes, diversification but with very low fee something like 0.7% as compared to 2-4% for most of the mutual funds.
Read more »
Stock trading is a proven and time tested method of wealth building that has been used by many people over the last few centuries to make fortunes. You can invest in stocks for a long haul like 2-5 years with your buy and hold style of investment. You can day trade stocks too. So what is the best method of investing in stocks?
There are thousands and thousands of stocks listed on the different stock exchanges in the world. Out of these thousands and thousands of stocks, only a few have the potential of making you rich in 2010. In US alone, more than 50,000 stocks are listed in the different stock exchanges like NYSE, NASDAQ, AMEX etc. Start the year 2010 with identifying ten best performing stocks in your opinion.Identification of these ten best performing stocks mean that you need to study these stocks in detail.
Focus on its price action and how well it matches with the S&P 500 Index. Before you invest in any stock, observe it for at least one week and do not put any money into it unless you probe it thoroughly and feel comfortable with it.
Read more »
This is arguably one of the most important questions to ask before you begin investing. Some investors have very well-defined investing strategies and can answer this question very quickly and easily. Others don’t and would struggle to answer this question. Regardless of where you fall on the spectrum, let’s briefly take a look at some of the basic investing strategies.
Do you like to buy stocks at a temporarily low price, and then sell them quickly within a week or two once the stock price has increased? If so, then you are not an investor at all. You are a trader. Traders like to look for short-term indicators that a stock’s price is about to increase and then sell the stock when the stock’s price has appreciated to a certain level.
Read more »
etf | admin January 3, 2010 | 
Comments (0) 