How to Profit from

Exchange-Traded Funds

WITH A NEW HOME STUDY COURSE:

ETF PROFIT DRIVER SYSTEM

ON LIMITED RELEASE

While ETF price movement looks like stock price movement, it's not. Most traders make the grave mistake of trying to trade ETFs with stock trading methods.

If stock trading methods are designed around stock market price behaviour, and ETF prices do not move like stock market prices, then how effective are these strategies likely to be?

This is one of the reasons Bill Poulos believes ETFs have taken so long to gain momentum. He thinks too many misguided traders who are just looking for a “quick fix” and while trying to force stock trading methods on the ETF markets come to the erroneous conclusion that they can’t profit from ETF trading.

This is the rationale behind the release of his ETF Profit Driver course. However, although it was designed for the ETF market, there are methods that can be used to increase profit-taking in other market trading too.

Charting requirements for the ETF Profit Driver

Serious technical traders know that an important part of trading requires low-cost but good charting software. While 'low-cost' is a relative term, a few dozen dollars per month for good data should be allowed for. A recommended charting software program is Worden Telechart which is a very high quality trading analysis software package that includes trade alert capability and provides US stock market data. Telechart is free, with a nominal monthly data feed cost.

The ETF Profit Driver System uses basic indicators only: Simple Moving Average, Slow Stochastics and ADX. These are very common indicators, but it's not the indicators but the trading method that is important.

The 'secret' of the ETF Profit Driver system is the uncommon way that these indicators are used.

Ideally, you should be able to configure these indicators as follows:

Simple Moving Average (SMA): 20 day and 50 day SMA.

Stochastics: Slow Stochastics, with the settings “8,3,3” (or just “8,3” if your software only lets you use 2 parameters). Specifically, ETF Profit Driver uses the %K value.

ADX (Average Directional Index) with the settings “14,14”.

If you can’t plot these indicators with your current charting software, the ETF Profit Driver Course shows you how to set them with other software available.

What is an Index ETF?

Similar to a traditional mutual fund, an index exchange-traded fund or ETF is an investment structure that pools the assets of its investors and uses professional managers to invest the money to meet clearly identified objectives, such as current income or capital appreciation.

Unlike a mutual fund, an index ETF is created when an institutional investor deposits securities into the fund in return for creation units. In return for the deposit, the institutional investor receives a fixed amount of shares, some or all of which may be traded and priced throughout the day on a stock exchange such as the American Stock Exchange (AMEX).

Retail investors who wish to buy or sell fund shares do not purchase or redeem directly from the fund - rather, they buy or sell fund shares on the stock exchange in a process identical to the purchase or sale of any other listed stock. All the strategies associated with stocks, such as market orders, limit orders, stop orders, short sales, and margin buying can be used in the purchase and sale of index ETFs.

However, ETFs are also used by long term investors to buy and hold. They can be purchased as part of an IRA portfolio.

Are basket-based products such as HOLDRs also index ETFs?

HOLDRs and other basket-based products are not really index ETFs. This is a term that has evolved over the years and has been adopted by investors, but is not completely accurate. A unit investment trust is not a fund. HOLDRs are grantor trusts, which are non-registered securities, not funds.

How do you buy and sell index ETFs?

Investors buy and sell index ETFs like stocks, typically through a brokerage account.

Investors can also employ traditional stock trading techniques, including stop orders, limit orders, margin purchases and short sales. As with all stocks, you may be required to deposit more money or securities into your margin account if the equity including the amount attributable to your index ETFs shares in your account declines.

Now you can study ETF trading at home and learn the methods to ensure consistent ETF Profit, wherever in the world you are based or would like to trade or invest. Get more details of the ETF Profit Driver System Home Study Course by visiting the ETF Profit Driver Website.

There are only a few copies of this ground-breaking course still available after the April 2008 launch.

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