ETF stands for exchange-traded fund. ETFs allow investors to easily buy a basket of various assets like an entire stock market index or sector in a single transaction. ETFs can track stock indexes, bonds, commodities, or other assets. They provide exposure to a wide range of markets while spreading out risk across multiple holdings. ETFs typically have lower expense ratios than mutual funds.

1. WHAT IS AN ETF?
ETF stands for...
ETFs make wide exposure quicker and simpler.
You can buy an ETF that tracks an entire
market, or even gives you double, triple
or greater exposure to a group of assets.
SPY and QQQ contain shares of every
stock in the S&P 500 and the NASDAQ,
respectively.
ETFs CAN FOCUS ON
SPECIALIZED MARKETS.
They can also be narrowed to specific
sectors or composed of instruments like
bonds or commodities.
When the housing market is hot, you could
invest by buying a house and then selling it later. Or you could skip
all that work and simply buy shares of a Homebuilding ETF (like
XHB or ITB) that includes building supply retailers, heavy equipment
manufacturers and construction companies.
During a gold rush, be the one selling shovels.
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ETFs are a way to mitigate risk
in volatile industries. A good
example is biotechnology: these
stocks can show big overnight
growth when a successful
new medicine or treatment is
developed—or an overnight crash
when a new drug fails.
KEEP IN
MIND: ETFS
HAVE A COST.
WHAT’S THE
ADVANTAGE
OF AN ETF?
ETFS ARE AN EASY WAY TO BUY
COMMODITIES.
The Gold ETF GLD was not so shiny
in mid-2005, when it was trading at
around $40. But when investors get
spooked, they often come running
to the relative safety of gold. During
the market correction of 2008, GLD
was trading at a high of $96, up
nearly 140%.
40
20
60
80
100
mid-2005 2008
}
$
up
nearly
140%
$96
$40
Gold ETF (GLD)
It’s called an expense ratio, and
it’s the % that you’ll be paying
in annual fees. Meaning lower is
better. It averages around half a
percent, which is lower than the
average for mutual funds.
If you’re looking for a better
way to invest, SwingTrader
gives you the strategies of
market experts. You get a
full trade setup—an ETF or
stock primed for growth, a
buy point, a profit target
and a stop-loss. These trades
produce quick-hit profits over
days, not months.
Exchange
Traded Fund
It’s a group of assets that you
trade like an individual stock.
ETFS
CAN
HELP
SPREAD
OUT RISK.
THE MOST
IMPORTANT PART
OF INVESTING
IN ETFS IS YOUR
STRATEGY.
SwingTrader gives
you the strategies of
market experts.
“
“
FAS is an ETF that generates returns similar
to 3X the Russell 1000 Financial Services
Index. SwingTrader identified FAS as a profit
opportunity in January 2018; members who
executed the setup notched nearly 8% in
profits in 19 days.
Biotech ETF BIB tracks the
NASDAQ Biotechnology Index
at 2X, meaning gains and losses
are magnified by that amount.
SwingTrader touted BIB as a
buying opportunity in Sept.
2017; members who executed
their ready-made trade plan
saw 3.4% profits in less than
2 weeks.
With one
trade, you can
buy a basket of
investments all
at once.
You can spread
out your risk
across a
broader range.
They have
lower fees than
many funds
and brokers.
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What’s an ETF?
Click on any of the ETFs below for more info and news courtesy of
AN ETF EXPLAINER