Squaring off your positions:

One of the obvious reasons why one should sell ETFs is for booking profits. So let’s say you have been in a long position for a while now and you want to take out some or all profits then one can sell the ETFs and get profits out of it. Also if one believes that now the market is not going to take the price of this ETF any further one can choose to square off their long positions.

Reducing downward risk:

So if one is heavily invested in the market and is feeling the risk of turbulent markets he/she can choose to sell an Index ETF so to hedge their current positions. So even if the markets turn downward still shorting ETF would at least keep an investor away from heavy losses.

Reducing downward industry risk:

If one has good amount of investments in a particular sector or a commodity he/she should consider taking a short position for sector ETFs or Commodity ETFs respectively. So let’s say a trader is bullish about Information Technology sector and have heavily invested in several stocks belonging to that sector he should also sell I.T. Sector ETFs to hedge their current positions.

Reducing your risks in Futures and Options:

Weather you have invested in equity, index, ETFs or futures and options you can use ETFs to hedge your risks. So let’s say you are bullish about the Crude Oil prices and you are long on Crude Oil Call options, you can sell Oil ETFs to gain an exposure to the downside risk you might have if the Crude Oil Prices fall.

Bearish about markets:

If you are a firm believer that markets are going to fall, in that case also you should consider selling Index ETFs. Additionally, within all the sectors if you think that a particular sector is going to perform the worse you can also consider selling that sector’s ETF.

Therefore, if you want to hedge your current positions, book some profits or take advantage of bearish market you can consider selling ETFs.

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1.)    Costs involved: It is often talked about and is true in the majority of the cases that ETFs are the most cost efficient when expense ratios, management fees and brokerage fees are looked at. However, one should compare ETFs with the comparable mutual funds or indexes before making any decision based on the costs. One other thing to point out is commissions so if you are a trader you should also consider this expense before you start trading ETFs.

2.)    Objective: A Trader should be clear about his objectives and goals before taking an ETF position. One should ask himself/herself on why are they taking ETF position? Is it because they want to gain an exposure to a particular index? Or they want exposure to a particular sector? Are they looking to hedge their current positions? Whatever may be the reason one should figure out what are their objectives before narrowing down to a particular ETF.

3.)    Taxation: Even though ETFs have a tax advantage over other comparable Mutual Funds or other comparable financial instruments when talking about International ETFs it turns out that taxation part is not so gracious.

4.)    Time Line: Trader should think about for how long he/she wants to stay invested in a particular financial instrument because there are pros and cons of different ETFs based on their preferred time horizon.

5.)    Fully Research the ETFs: One of the best aspects about ETFs is the way how information is shared with current and prospective investors. Most updated scripts or securities held by ETFs are being shared openly. So if you are scoping out feasibility, you should start analyzing holdings of all the ETFs being considered by you. If you are looking at an Index ETF you can find out how ETFs have diversified their portfolio, if you are looking at Emerging Market ETFs you can find out which countries this ETF is focusing on, for sector ETF one can analyze the companies these ETFs have invested in.

So consider these aspects before you narrow down to a particular ETF.

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Taking a Put Option Long Position

Just like any other Put Options, ETF Put Option offers a trader to get an exposure or hedge the downward fluctuations in the market. Basically, with put options a trader has a right to sell an ETF at an agreed up-on price (strike price). For example, if a trader goes long on April 150 put he has a right to sell the respective ETF for $150 and a trader can execute this right anytime before April.  Even if the respective ETF trades at $120 trader can sell the ETF at $150.

Taking a Put Option Short Position

When a trader goes short on put options, he gives a right to the other party who has a long position on that put to sell the ETF at the agreed upon strike price at any time before expiration. This is an opposite of having a long position but it is similar to going long on a Call option. For example, if you take a short position on an April 150 put for $20, a trader would want these ETFs to not go below the $150 mark or else he might start incurring a loss on his investments.

Taking a Call Option Long Position

With this type of Call option a trader has a right to buy the agreed quantity and type of Exchange Traded Funds at a certain price (the strike price). So if a trader takes an April 150 Call option Long position, he has a right to buy the respective ETF for $150 anytime before April. Therefore even if the price of the respective ETF climbs to $170 a trader in contract can still buy that ETF for $150.

Taking a Call Option Short Position

As part of this strategy a trader can take a short position so you want the value of ETF to decrease. So if a trader sells April 150 Call option for $12, he will make money if value of the respective ETF never goes above $150.

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Market ETFs are financial instruments that are created to keep a track on a particular index with the objective of closely replicating it unlike mutual funds which does not closely follow the index but it tries to outperform the index. Usually these ETFs hold the stocks which belong to the index it is tracking.

Reasons for Trading Market ETF

Following could be the reasons why you should trade in Market ETFs

i)                    To hedge your current positions

ii)                   To capitalize on a market opportunity

Therefore if being a trader you want to hedge the risk of your current positions, market ETFs can help you reduce that risk. Whatever may be your positions, you can go long or short with market ETFs and reduce your portfolio’s risk.

On the other side one can also trade in Market ETFs for capitalizing on an opportunity. May the opportunity be in any part of the world there would be an ETF with the help of which you can get an exposure to that market or index. Further, Market ETF offers a portfolio of a particular index so to get an exposure to an index trader can stay away from the hassle of investing in multiple stocks of that index.

Characteristics of Market ETF

One of the top reasons why a trader should consider investing in Market ETF is because of its less volatile nature in comparison to Sector ETFs or any other Funds. To replicate the performance of index, Market ETFs invest in stocks of all sectors and industries which make them less volatile when compared to other Sector focused ETFs. However, some market situations like declining or rising economy can work against this scenario and can make Market ETFs turbulent.

Apart from these characteristics Market ETFs of course have the benefits which all other Exchange Traded Funds have like lower expense ratio, lower taxation and lower management fees. Additionally, just like stocks one can buy and sell ETFs on the exchange during the trading session.

If you are a trader currently not investing in Market Exchange Traded Funds here are some of the top performing funds:

• PowerShares QQQ Trust Series I (QQQQ) – This Market ETF invest in 100 stocks from NASDAQ
• iShares MSCI Germany Index Fund (EWG) – Tracks German index
• TraHK – This Market ETF tracks the Hang Seng index

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1.) Easy Trading

ETFs’ stock like feature makes it easy for individual investors, institutional investors and hedge funds to buy and sell these instruments. Unlike Mutual Funds one can trade ETFs on the exchange anytime during the trading session.

2.) Hassel Free Management

For some of the Index ETFs the prime goal of their establishment is to track the performance of an Index as opposed to Mutual Funds where they might look at outperforming an Index. Hence the risk associated with ETF is low coupled with low management fees.

3.) Futures and Options

If a trader is looking to use Futures and Options for hedging their current positions they do not need to think about the learning curve or directly get involved in risky F&Os instead one can invest in Derivatives ETF.

4.) Cost Effective

If these funds are compared with other available funds, ETFs have lower expense ratio and lower management fees.

5.) Transparency

All of the holdings of Exchange Traded Funds are broadcasted on daily basis. This feature keeps the investors satisfied as they can find out where their investments are being utilized.

6.) Taxes

When ETFs are compared to Mutual Funds then ETF wins the race for Capital gain taxes which are comparatively low.

7.) Hassel Free Portfolio Investment

If a trader believes that a particular sector is going to be a top gainer in near future he has an option of investing in a particular stock which belongs to that sector and keep a track on the price. This becomes risky since it’s hard to predict which stock will be a winner amongst all and also it’s a hassle to continuously keeping a track on the price. Instead trader can invest in Sector ETF which invests in several companies that belongs to that particular sector and in turn trader can stay out of the hassle.

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Exchange Traded Notes are in a way a combination of bonds and Exchange Traded Funds. They were first issued by Barclays Bank PLC. Generally, notes are type of secured bonds with fixed returns and with principle protection but Exchange Traded Notes are unsecured debts, the returns of these notes depend on how good or how bad the markets perform and there is no protection of investor’s principle how one would have in case of bonds. ETNs can also be stock like bought and sold on the exchange during the trading hours, this feature of ETN matches with that of ETF.

One feature that helps the traders to differentiate between ETN and ETF is that there is a maturity associated with ETNs, so one can trade the ETNs on the exchange or wait for the maturity and get the principle and the gains or losses on that particular day. One aspect that may affect the price of these notes is the credit rating of the issuer of the notes. Therefore, even though there is not much change in the price of index, the value of exchange traded notes may fall due to the drop in the credit rating of the issuer. As per the IRS’ tax guide lines normal tax rates will be applicable on gains from currency ETNs as opposed to ETFs where capital gain taxes are applied. So when ETNs are compared to ETFs from taxation perspective ETNs loses its edge.

There are different types of Exchange Traded Notes available in the market today. However, the four major types of ETNs are Currency ETNs, Commodity ETNs, strategy ETNs and Emerging Market ETNs. Most of you might be aware about three of the above four types but Strategy ETNs. So what are strategy ETNs? Strategy Exchange Traded Notes are associated with the performance of the index. So Index Long and Index Short are examples of strategy ETNs.  Two of the popular ETNs offered by Barclays are iPath CBOE S&P 500 Buy Write Index ETN (BWV) and Barclays GEMS IndexTM ETN (JEM).

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Institutional investors, Banks and Hedge Fund managers have already tried and tested ETF Funds so the popularity and growth seen in the recent years is due to these set of investors. Financial Guru’s and Researchers believe that the growth will continue since ETF funds have started attracting ordinary traders as well. If we look at asset growth then during the year 1995 approximately little over a billion dollars were invested in ETFs, then in year 2000 it grew to $62 billion approximately, in year 2005 it was around $300 billion and last year in 2008 it shoot up to around $540 billion.

Authorized participants act as a liaison between the investors and the ETF sponsors. They are the only party which deals with the sponsors and are also known as the market makers. In absence of market forces with the help of Arbitrage authorized participants try to bring the market price of ETF near to the current net asset value. More over arbitrage is not carried out to facilitate the investors or the ETF sponsors but it is done to earn a prospective profit out of it.

One of the important features of Exchange Traded Funds is the availability of information, institutional investors and banks that offer these funds fully share their holding details (as opposed to mutual funds who is unwilling to share their holding details). Additionally, a comprehensive detail of the holdings of a particular ETF also helps the traders to make a decision on including an ETF into their investment portfolio. Since holding an ETF is like holding stocks of several companies, it provides more diversified portfolio which is less risky and of course by investing in ETFs one is staying away from managing and daily tracking of bunch of stocks.

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So if there are still worries about the stock market and there is going to be recession in the economy the rational idea is to short the index. However if a trader does not have a margin account and don’t want to have one, ETF Short becomes the right choice. Unlike Mutual Funds one can buy and sell ETFs on the exchange during the trading session just like ordinary stocks.

Usually Short ETFs can be categorized in to following three types:

1.)   Normal Short ETF: In this type of ETFs a trader gets returns equal to the fall in the market i.e. if the market falls by 2% value of this ETF goes up by 2%. Some of the popular Short ETFs are Short S&P 500 ProShares (SH), Short NASDAQ-100 Index (PSQ), Short Dow Jones Industrial Average SM (DOG), and Short Russell 2000 Index (RWM).

2.)   Double Short ETF: In this type of ETFs a trader gets double the returns in case the market falls i.e. if the market falls by 2% then the value of this ETF goes up by 4%.

3.)   Ultra Short ETF: Some of these Ultra Short ETF offers a trader to get 2.5 times the returns if the market falls i.e. if the market falls by 2% value of this ETF will go up by 5%. Some of the popular Ultra Short ETFs are UltraShort NASDAQ-100 Index (QID), UltraShort Dow Jones Industrial Average SM (DXD), UltraShort S&P 500 Index (SDS) and UltraShort Russell 2000 Index (TWM).

Today traders do not need to worry about the falling markets so either you already are invested in the current market and want to hedge your risk by taking an inverse position or if you believe markets are going to fall you can deal in these ETFs and take advantage of the situation.

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Initially when the International ETF was introduced for the traders based in United States they offered Eastern Europe, Latin America and Southeast Asia in the same fund termed as emerging-markets. Now days you can trade on the metal prices on exchanges in India and China, one can play on political ambiguity in Turkey, business located in small but strong economy like Malaysia thanks to ETFs. The instruments offered today gives strength to the investors to invest in any economy in any part of the world, and all the different verities of products.

International ETFs are increasingly becoming popular with the current financial crisis. As performance of U.S. markets is facing the consequences of recession and since it’s not true for other Asian and Emerging markets traders are investing in ETFs that manage their funds in those markets. In the past if the developed countries were in recession it would hurt the emerging market’s performance as well, however today local businesses in emerging markets are so strong that recession in developed economies have little effect. By investing in International ETF traders can hedge their current positions in the local exchanges or they can just square off their local positions and only invest in emerging markets where today there are more opportunities to earn profits.

Depending on the changing market forces and changing conditions of different economies of the world banks and financial institutions offer funds that would help the investors make profits. Some of the popular International ETFs are as follows: iShares MSCI Emerging Markets Index (EEM) - these funds have given great returns if you look at the change in its Net Asset Value. Their Top 5 Holdings include Samsung Electronics Co., Ltd. (GDR), Taiwan Semiconductor Manufacturing ADR, Itau Unibanco Holding S.A. ADR, Petroleo Brasileiro S.A., Petroleo Brasileiro S.A. ADR. Likewise there is iShares Trust FTSE-Xinhua China 25 Index Fund, iShares MSCI Brazil Index Fund, iShares MSCI South Africa Index Fund and many more.

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Several different types of ETF are being offered to ordinary traders. One can keep away from the hassle involved with holding physical commodities or precious metal and can buy Commodity ETFs. Likewise, if one is optimistic about the overall markets they can buy Index ETF and if someone thinks that markets are going to fall then they can buy Index Short ETFs. If the local economy is facing recession then one can invest in the Emerging markets Index ETFs or Currency ETFs of Emerging Markets. One of such products introduced and is very popular amongst traders is Sector ETF; Fund Manager who manages this fund invests money into companies of a particular sector.

If a trader believes that a particular sector is going to perform better based on the current market scenario in the past they used to invest in a particular company which belongs to that sector. Investment of this type becomes risky since you are weighing a huge part of your portfolio into one company. By investing in Sector ETF trader is taking advantage of the whole sector and at the same time staying away from the risk of being heavily invested in a particular company’s stock. With Sector ETF there are sub categories, so there are funds available in the market which invests in companies of a particular sector but based only in one market, there are also some that invest in a particular sector’s companies domiciled locally as well as internationally.

Some of the popular Sector ETF is as follows: Merrill Lynch Retail HOLDERs (RTH): These Funds invest in companies of retail sector based in the United States. Retail HOLDERs is listed with NASDAQ, top 5 holdings of this fund are Wal-mart stores, Home Depot, Target Corporation, Walgreen Company and Amazon.com. Likewise there is Vanguard Information Technology ETF, Select Sector SPDR Fund – Financial, iShares Dow Jones U.S. Telecommunications Index Fund and many more.

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Generally there are two types of Exchange Traded Funds that deal in silver where a trader can invest. First type of ETF is where banks or financial institutions actually hold silver and Second type of ETF is where fund managers invest in the futures and options that track the price of silver. Both the types of ETF will move in the same direction as the current cash price of silver. Silver ETFs become a perfect investment for banks or institutional investors looking for short term gain or who wants to use this commodity fund to hedge their risks from other investments for a while. However, there are a limited number of investors who are looking for long term gains out of this precious metal based on its robust historical data and also because they want to play safe.

Some of the most popular Silver ETFs are as follows:

1.) iShares Silver Trust (SLV): This fund is quite old in comparison to others that offer Exchange Traded Funds in Silver, it is also one of the largest of all. SLV is a fund that holds physical silver and keeps the investors free of the headaches associated with holding precious metals. Today iShare Silver Trust holds silver worth $4.54 billion.

PowerShares DB Silver Fund (DBS): Unlike its counterparts this fund doesn’t hold physical silver but it invests in derivatives that track spot price of silver. Futures and options contracts these fund deal in are based on an index managed and developed by Deutsche Bank.

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What would you need to pick up and being with Exchange Traded Funds? If you are already a trader needless to say this but for those who has never traded into any kind of instruments, one needs to open up a brokerage account with a bank or financial institution. It would be really helpful to discuss how are the experiences of some of the clients of the broker you want to get associated with and also talk to the broker about your own investment plans.

Next would be to do a good research on the ETFs that interests you, then sort out the ones which you would like to buy and discuss these ETFs with your broker. Broker might look at the options and suggest you that according to him where should your money be invested based on the market research, expected future market conditions, growth aspects etc. Depending on your short and long term goals you can sort out the ETF investment that works out best for you.

Today the chances of market volatility is at the peak, not so while a go more than 85% of 401k’s were in red and in really bad shape. With 401k there is little in your control, but in case if you have invested in ETFs you can set up parameters. So if you are willing to take risk that if the funds value falls up to a certain limit you can bare the risk but if it falls further you can put a stop loss. With this feature you can put a limit on the losses you may have to bear in case market crashes.

You can put a trade order with your broker by phone or take help of the latest trading software and web based systems. Periodically meet with your broker or keep a check on your portfolio to see where you stand.

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Let’s look at how Trading Signals are being created and then we will see after creation how they are being broadcasted to the traders. Based on the below mentioned ways ETF Trading Signals are created:

Technical Analysis and Chart Analysis: is analysis of ETF where in the historical data primarily price and open interest (volume) is being tracked. Various quantitative models like moving averages, correlation coefficient and regressions are being employed to the price and volume data and future patterns are predicted. Trends and Patterns seen in the Charts are also being analyzed; examples of some of the popular chart patterns are head and shoulders, Symmetrical Triangles, Ascending Triangles, Descending Triangles and Flags and Pennants. As per the technical analyst it doesn’t matter what is the market movements is it bullish or bearish if you know how to read the patterns it can guide you when to go long and when to go short on a particular ETF.

Fundamental Analysis: over here the fundamentals of different companies where the Exchange Traded Funds have invested is being assessed. To be precise if an ETF has invested in stocks of 30 companies, variables like assets, liabilities, present and forecasted sales, growth in profits, competition, competitive advantages and likes are being assessed for these companies. Based on this assessment trend of an ETF is forecasted and a signal is being sent to the traders.

In their ongoing research Fund Managers or Investment Analysts may find a great investment opportunity. It could be for taking advantage of forecasted high returns or it could be for using an ETF to hedge your risks against a possible future crisis in the markets. There could be several different ways of broadcasting ETF Trading Signals like traders can subscribe to a newsletter, our software or web based trading system could prompt us a signal, we may receive a call from our broker or these days traders can also subscribe for text messages which send trading signals.

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All of you out there must be aware about mutual funds and how do they work, now here is a new more tax efficient and less expense prone investment. So expenses involved with ETFs are low and now comes the time to find out which ETFs best suits your requirement and matches your portfolio. There are many types of ETFs available today in the market, it always makes sense to invest in a particular sector rather than investing in a particular company’s stock so there are Sector Specific ETFs. With today’s market crisis one can hedge their risks by investing in Commodity ETFs which invest in Gold. Also in comparison to US markets Asian markets are performing much better so to take advantage of Asian markets there are international ETFs that invest in Asian indexes.

Once you have narrowed down the list of ETFs that you like, you should not directly jump into the market and start trading. It always helps to track a particular investment opportunity before actually investing in it. So if you are not using a Software or Web Based application you can visit Google or Yahoo’s Finance portal create your own portfolio for free, add the ETFs that you like and keep a track on the price movements. Once you have seen which ETF performs best for you and also fits perfectly into your portfolio. All you would need is to have a Brokerage account and your broker’s number or if you are using a Software or Web Based application open up your system and start trading.

Some traders find ETF trading perfect to hedge the risks from their current exposures, while some find the returns from ETFs lucrative so they invest major portion of their investments in ETF. Reason could be any for ETF trading but sure there is a great investment opportunity around the corner.

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Below are some of the different varieties of ETFs available today:

1.)    Actively Managed ETFs: These types of funds are recently introduced in the United States. The very first Actively Managed ETF came into existence in early 2008 however it was liquidated by the end of 2008. All the information about actively managed ETFs are available in the markets, also on funds websites one can find daily updated list of securities in their portfolios.

2.)    Index ETFs: Some of the initial ETFs that came into being were Index ETFs, today most ETFs act as index funds which holds the stocks and try to replicate the act of a stock market index.

For example: iShares S&P 500 index ETF (IVV), iShares Dow Jones US Insur. Index ETF (IAK).

3.)    Commodity ETFs: Commodity ETFs are the funds that hold the actual asset and track the price of the underlying commodity and accordingly this ETF is traded on the exchange based on its Net Asset Value.

For example: Market Vectors Gold Mining ETF (GDX), SPDR Gold ETF (GLD).

4.)    Bond ETFs: They invest in Government treasury bonds, these funds are the best during the time of recession. People who stayed invested in stocks during the financial crisis not only lost their profits but also a part of their invested principle.

For example: iShares iBoxx $ High Yield Corporate Bd (HYG).

5.)    Currency ETFs: There are sub categories in this type of ETFs there are some ETFs which invest in multiple currencies and there are some that invest in a particular currency.

For example: Sterling Money Market ETF (XGBP), US Dollar Money Market ETF (XUSD).

6.)    Hedge Fund ETFs: Exchange Traded Funds over here tracks multiple hedge funds and follow their activities and/or strategies.

For example: Index IQ Hedge Mst ETF (QAI).

Now since you have made the decision of investing in ETF find the one that best suits your requirement and start rolling.

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A trader can trade in ETFs by below mentioned ETF Trading System:

1.) Broker: Like any other stock you can also trade ETFs through a broker and once bought you can see the funds directly into your brokerage account. Some traders have always been investing in stocks, futures or funds via their broker and they are comfortable with the same system of investments they believe “why get into the hassle of buying and selling yourself if your broker is one phone call away.”

2.) Software or Web Based Investments: Unlike the conventional investors there are also many who are diverting towards taking matter in their own hands and would like to take the advantage or get out of the market when the price is right. There are many Brokerage firms and Financial Institutions offering Software and Web Based Systems where in trader can see the market movements, take the decision and act upon it. Software or Web Based ETF Trading System offered today have excellent features such as:

-> One can set up triggers for taking advantage of the market movements and buying or selling the ETFs at the price which best works for you.

-> These systems also offer tips so if there is a good buy in the market that investor should keep an eye on the system will prompt to buy that particular ETF.

Before getting in the system and start trading firstly a trader needs to find out which ETF is best for him/her. There are several websites which offers a tracking system where in you can track a particular ETF for a while see where is it going and if the track record turns out to be as you expected you can then buy that ETF. Google and Yahoo’s Finance section also offers a feature where in you can track a particular ETF.

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However investors should be aware about one aspect which can have an impact on their returns from ETFs. Investors should keep in mind that these instruments which are being traded on the exchange are subject to brokerage fee. Usually in the United States the brokerage fees hovers between $10 to $20, and at times it can also be as low as $3 with some discount brokers. As everyone is in the business to earn profits same is reflected in the brokers policies, so if someone wants to invest $300 per month may have a considerable proportion of investment ruined immediately, as opposed to someone making a $500,000 investment, the cost of brokerage fee may be minor.

Investor should also remember the expense ratio which is the administrative burden that the funds charges for investing trader’s money. As a trader if you are thinking on either investing in ETFs or mutual funds it’s important to remember that most mutual funds have higher expense ratio than comparable ETF expense ratio. For example: Mutual funds may charge somewhere between 1% to 3%, or more; while with ETF expense ratio mostly falls between 0.1% to 1% range. Merely looking at the percentage it may seem like a small difference but for an actual trader this difference in percentage can be an important driver while adding an investment to his/her portfolio.

If you are looking at all the expenses involved with ETF then taxation is also one expense to consider before making that investment decision. So again if we are looking at ETF in comparison to mutual funds since they are the most similar kind of investment instruments, from taxation perspective ETFs are more attractive than mutual funds.

The most important benefit for ETFs that it can be stock like traded on the exchange combined with the low ETF expense ratio makes it more lucrative for traders when they are compared with mutual funds, stocks, derivatives or bonds.

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Said that, if you are a trader and want to invest in gold there are several different ways you can increase your exposure in gold, however it’s also important to find out amongst all the different options which is the best investment basket for you. If a trader is looking at gold he/she can invest directly through bullion or buying a coin, or indirectly through gold exchange-traded funds, shares, certificates or derivatives.

Gold Exchange Traded Funds is a relatively new concept but since its establishment it has gained huge popularity amongst the traders. One of the top reasons for traders’ inclination towards Gold ETF is, why directly invest in gold and then find a buyer to square off your position if there is a fund doing the same and is being traded on the index based on its Net Asset Value (NAV).

photo credit: BullionVault

So if a trader is looking at Gold ETFs there are set of offerings which one needs to look at and find out which perfectly matches his/her investment portfolio based on his/her sentiments and strategies. Following are types of Gold ETFs available:

1.)    Gold ETFs that own Gold Mining Stocks: The model these ETFs follow is they hold stocks of gold mining companies from around the world.

For example :
Market Vectors Gold Mining ETF (GDX)

2.)    Gold ETFs which actually owns Physical Gold.

For example :
SPDR Gold ETF (GLD)
iShares Comex Gold Trust (IAU)

3.)    Gold Short ETFs: These ETFs believe that Gold will be seeing bearish trend and goes short on gold. So if the gold prices go down Gold Short ETFs prices will go up.

For example:
PowerShares DB Gold Short ETN (DGZ)
PowerShares DB Gold Double Short ETN (DZZ)

4.)    Gold ETFs that own Future Contracts: These funds only invest in Gold future contracts so some of the ETFs only tracks the upward movement in future contracts and some track the complete opposite.

For example:
Powershares DB Gold Fund(DGL)
E-Tracs CMCI Gold Total Return ETN(UGB)

Considering your current investments you can choose the Gold Exchange Traded Funds that best matches your portfolio and your strategy.

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Make 6% Per Month in ETFs. Trade only 10 minutes per evening. Click here to learn more.

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Further, everyone is pretty much aware about the new talk in the town that the future of Social Security doesn’t look that bright. As the time goes by and millions of baby boomers reach an age and approach retirement, the social security program’s funds will decrease and eventually disappear. To overcome this problem government will have to shrink in size and at the same time general revenues out of the tax payer’s money will need to be used to pay for social security. It’s wise to start looking at alternatives on how you can make yours and your family’s future secure.

ETF’s are turning out to be the best investment opportunity in current financially uncertain environment. So if you are a trader and are considering ETF Trading as an option you may need to subscribe to an ETF Newsletter which teaches you on how ETF’s work, what are the ETF related updates, news, tips and tricks.

There are whole bunch of ETF Newsletters available, following are some of the topics which they cover:

1.)    Some newsletters are specific to teaching ETF basics to the subscriber’s who wants to learn more on what ETF trading is all about. It tries to point out how to trade ETF’s and then it’s the traders job to find out how to use ETFs in his investment basket i.e. if the trader discovers that ETF gives great returns he can increase his investments in this instrument or it may fit in as a great hedging tool in traders portfolio.

2.)    There are several newsletters where the company has hired a group of traders who actually trade ETFs. These newsletters are more focused on what are the ongoing money making trends in ETF trading, what the strategies are, where these traders have made money and which actions to keep away from.

You can also try and do what I did before I actually started trading ETFs; I took 30 day free trial subscription of some of the top ETF Newsletters. It’s always best to test something before you actually buy it (wink).

Make 6% Per Month in ETFs. Trade only 10 minutes per evening. Click here to learn more.

This post via the etf trading blog which is your guide to learn everything related to ETFs trading.

Sector ETF trading strategy: Some traders love trading in a specific stock, if your broker is asking you to increase your exposure to a specific sector it becomes tough to sort out which stock can give best returns in that sector. You don’t need to rely on anyone’s instincts but also you don’t want to miss out on the bus. In this situation the best strategy for a trader can be to look at Sector Specific ETF’s.

Stock ETF pair strategy is one of the favorites of hedge funds. Let’s say if you are eyeing at getting highly invested into a particular stock because you think it will give the best returns in comparison to other stocks in that sector, but you are worried about the direction of the whole sector on the next go. In this case you can buy the particular stock and short that stock’s sector ETF. Reverse is true also if you think a particular company’s stock is going to perform worse you can short that company’s stock and on the other side go long on sector ETF in which that stock belong to. Since the trader is hedging his position this can be a great investment opportunity that is if he has intimate information about some company and an industry. However this is not a “No Risk” strategy, if the company’s stock as well as the sector both moves in completely contradictory directions of what a trader thought he has to bear a loss on both the trades.

If an investor usually has huge cash sitting in his portfolio, rather than exposing his investments to money market funds a trader can invest in short-duration Bond ETFs. Return on investment in these ETFs is two to three times the returns a trader gets by investing the same funds in money-markets.

Therefore don’t let the current economic conditions discourage you because there are ETF trading strategies with which a trader can not only earn their bread and butter but if used effectively can help you beat the market and make a fortune out of it.

Make 6% Per Month in ETFs. Trade only 10 minutes per evening. Click here to learn more.

This post via the etf trading blog which is your guide to learn everything related to ETFs trading.