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  #1  
Old 08-27-2006, 06:27 PM
Mrs Manager Mrs Manager is offline
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Default Mutual funds and ETF's

Another good article on funds:
http://www.marketwatch.com/news/stor...&dist=printTop


Exchange-traded funds are built like a mutual fund, typically an index fund, but trade moment by moment like a stock. While they may seem new to many investors, they actually have been around since 1993, with the creation of Standard & Poor's Depository Receipts, commonly known as "Spiders." For many investors, ETFs piqued their interest in the later 1990s, with the emergence of the "Qubes," named for the ticker symbol (QQQQ) of the Nasdaq 100; during the bull market, technology-oriented investors used Qubes to turbocharge their portfolios.

Today, however, there are ETFs of virtually every flavor. Critics of the business have noted that issuers are slicing off tiny market segments to be the focus of new products, so that an investor can get a fund that tracks, say, nanotechnology stocks or companies that build homes, or can buy into the stock market of, say, Austria or South Africa. And while ETFs currently replicate only index products, many of the new products are tied to benchmarks that are new, unproven and almost actively managed compared to the old standards.

Most people who give ETFs the "better" label point to expenses and tax efficiency, areas where ETFs can beat the traditional index fund, although the difference can be non-existent or marginal depending on the funds involved.

The flexibility of trading throughout the day is a bonus for an investor who is making a short-term play. Investors also can buy ETFs on margin -- borrowing money to increase their buying power -- or sell them short, betting that the market index is due for a decline.

The biggest drawback to ETFs for many investors is the simple fact that they must be purchased through a broker. Mike D. didn't say if he was shifting a well-built portfolio or building one for the first time, but the difference is crucial; an investor who has a big chunk of money to invest can do it all at once and incur one commission, while someone who invests regularly will pay the freight with every small step they make.

Even with the low fees charged by online and discount brokers these days, the charges alone make ETFs the wrong choice for the investor who is setting aside money every month or quarter.

"What you save in tax efficiency and in the expense ratio, you lose -- and then some -- with every trade you make," says Gregg Brewer, director of mutual fund resources at Value Line. "If you have a lot of money to move, like in an IRA rollover, an ETF might be the right choice, but if you are dollar-cost averaging trying to get to where you have a lot of money, the traditional fund will be the way to go."

Finally, the flexibility that some people find as a positive of ETFs also can be a negative, if it leads to quick trades. The savvy traditional index fund investor is playing a buy-and-hold game; the ETF investor buying a thin sector or taking a flyer on the stock market in Malaysia -- or even delving into the Qubes -- tends to be making short-term, market-timing decisions.

For many people, it's like buying a sports car because it's good-looking and saying you never intend to break the speed limit. Eventually, most drivers will want to see what the car can do. Likewise, an investor knowing that the ETF can be traded on a moment's notice may pull the trigger on a trade when the market is having a bad day.
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Old 11-17-2014, 05:33 AM
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davidsmith1 davidsmith1 is offline
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Default Re: Mutual funds and ETF's

Mutual funds are a hot commodity with individual investors and financial institutions. Mutual funds are actively managed by a financial money manager who constantly watches the stocks and bonds in the fund's stock portfolio. Mutual fund investing is a good match for traders interested in long term investing.

Exchange-Traded Funds (ETFs) are investment funds that aim to monitor the efficiency (value or price) of an index, a particular commodity or a number of commodities, or other financial products. ETF funds are mainly an index fund (mutual funds which monitor indexes of the stock market) but still they trade just like stocks do. A person can't avoid capital gains, but an investor won't pay capital gains on their ETF shares until the final sale. ETFs can cost the investor less money in taxes.
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Old 09-21-2015, 02:47 PM
FuturesTrader FuturesTrader is offline
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Default Re: Mutual funds and ETF's

ETFs can be a great option for trend-following style traders who want to reduce their leverage. Even a x3 leveraged ETF is a significant reduction from something like the x20 you get with options and futures. Reducing leverage can be a great way to reduce risk - when markets become extremely volatile I often switch from the ES futures contract to the SPXL ETF to reduce my exposure.
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Old 01-02-2019, 11:15 PM
SunnyMay SunnyMay is offline
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Default Re: Mutual funds and ETF's

God, it's so complicated I think. I am not well financially-educated and I am trying to fix that but still, for me it's easier to just spend spare money on www.sg.bet888win.org/online-betting/tbsbet for example. You can make quite a lot with the right approach.
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Old 01-26-2019, 03:15 PM
John Tollerman John Tollerman is offline
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Default Re: Mutual funds and ETF's

I don’t prefer such stuff, as I feel in Forex you will be wasting time on such things. If we do trading in proper way then we will end up with making good profits. IF not then we will only struggle with things.
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