How to Profit with

Exchange-Traded Funds

A NEW HOME STUDY COURSE PLUS
SIGNALS ALERT SOFTWARE:

THE ETF PORTFOLIO PROPHET

RELEASED IN 2011
 

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 ETFs have taken so long to gain momentum. 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.

The all-new Portfolio Prophet for ETF profit is more than a home study course for ETFs. It will include trade alert signals software that tell you when to enter a trade, change stops and exit.

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.

Soon you will be able to 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, with the all-new

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