ETF Trading Question, Please Advise?

Question

I am interested in entering the realm of ETF's. I have noticed a few in particular, that seem to catch my eye. In general my investment style is able to take moderate to high amounts of risk in order to achieve higher return's. I have invested in indivdual stocks, mutual funds and other similar items; however am new to the field of ETF trading. Could someone suggest a good starting point, a few good ETF's, and those to stay away from? Any advice, tips, hints, etc would be much apprieciated. A little more info about myself incase it will help. I'm 20, from the US, am not opposed to investing in a foriegn ETF, especially since they seem to give better returns. I'm looking something that will provide a good rate of return, with "above normal" risk, however I'm not looking something so volital as to lose sleep at night. Thank you again!

Additionally, I forgot to ask. As with mutual funds, do ETF's have minimum "initial" investment amounts?

Answer 1

A few websites:

http://www.etfconnect.com/
http://www.etfguide.com/
http://www.morningstar.com/
http://www.powershares.com/
http://www.ishares.com/

A big advantage of ETFs is that you can trade out when the trend is down. Mutual funds often have rules to prevent timing the market.

Here are some recommendations for you to check out.

JKF: large value
IWS: midcap value
IWN: small cap value
ICF: real estate REIT
XLE: Oil and gas
EFV: International value (mostly Europe and Japan)
ADRE: Emerging markets
FXI: China
EPP: Pacific: Australia, Hong Kong, Singapore (no Japan)
ILF: Latin America large caps.

I currently own shares of ILF as it is on an uptrend.

Answer 2

DBC I would stay away from until next year its a heavy rich oil play DJP is by far a better balanced commodity play and GRG doesn't exist. XLE also stay away from for now. Emerging Markets (ADRE has been on a tear for me lately as has EEM when i owned it) are a must especially now that the commies are in control. Pretty much any ETF has the ability to make $5 or lose $5 in a single day (EEM has for sure) SLV the pure silver play has made and lost even more than that. Advice make it balanced (large and small caps) do not go over 20% in any sector holding try not to go over 10% in japan (5% is better) don't be afraid of emerging markets and do NOT forget europe (ADRU works for me as does EFA or IEV). You can time the market but you cannot buy the shares after the closing bell at the closing price which is what a lot of mutual fund companies did and got busted for it. You need a core etf us perferable one that has a decent dividend (but not too high because the commies are getting ready to tax it) . Do Not invest in a single country (way too much risk there especially in China, japan, Brazil etc stick with an emerging markets and a euorpean play.

Take a look at VIG its a nice well rounded divendend play and a new one from vanguard something like that would make for a good core fund.

starting point two places moringstar.com and sharebuilder.com morningstar has the techinal analysis you need and sharebuilder is a good place to start and they also have a very good research center for ETF's.

the minimum amount is different for etf's the share price is what you pay plus the added commission fees for buying and selling it. look at the major players scottrade, tdwaterhouse, thinkorswim etc....compare rates and such put a stop loss on every order and go for it.

Answer 3

Yardbird has some good ones
let me add my two cents worth

GRG and DBC are commodity ETFs
....use as a hedge against the market...

if you are interested in ETFs, you might want to explore
close-ended mutual funds, they are closer to ETFs than "open" mutual funds...and many have a longer market history....
I prefer a good dividend paying fund...something that most ETFs don't do

RNE, IAF, CEE, EEA, GRR, USA, ASG and PEO might be interesting places to research...

good hunting

good hunting

Answer 4

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