How Can I Start Invest Into Index Fund (ETF or QQQQ)???

Question

I have $600 to start. I think i go with ShareBuilder or Scottrade. Any Suggestion? I won't buy/sell very often, so what plan should I choose?

Answer 1

$600 is too little to buy ETFs. Even at the best prices you would lose $8 on the buy and sell, or 1.3%. I would invest that $600 in a no-load Index fund like Vanguard's. I think they have a $500 minimum. Also the QQQQ is garbage, you want a real index like the SPY, MDY, IWM, etc. Do a 5-yr performance comparison if you don't believe me.

Answer 2

$600 is nothing I agree you need more however if you have a long term INVESTMENT plan then sharebuilder will suit you but for trading scottrade or Tradeking (haven't used) will be your better choice. The selling fees are too high for sharebuilder and thats why i switched to scottrade. As for QQQQ i also do not recommend buying it (I actually sold my QQQQ's after Vista hit the market and after investing it for a few month prior made a decent little profit on it). I just don't see big movements in the qqq's right now.

Answer 3

Trade King has a good reputation. Also Scottrade.

Index funds. There is something that you need to know about index funds, especially QQQQ. It is capitalization weighted as are most but not all. What does that mean? That means that about 10 stocks in QQQQ make up about 38% of the holdings of the fund. Bottom line is you are not as diversified as you might think. 5 year annual return of QQQQ is about 5.45%. It may improve.

Now I do want to try to sell you anything. I just want to see if I can help. There are about 200 to 300 index funds available. As I said most are capitalization weighted but not all. RSP is an unweighted index on the S&P 500. That means all 500 share the same amount in the portfolio and it is rebalanced quarterly. Has not been in existance 5 years, only 3. Three year annual return is 12.2% twice the 3 year annual return of QQQQ. Also better than the capitalization weighted S&P 500 index funds SPY, etc.

Before you go jumping into an index fund, check out this link which as all the pertinent statistics on all the index funds.

http://www.etfconnect.com/select/rank/default.asp?fType=2&oType=6

Answer 4

Scottrade is good. Right now the tech stocks are not so hot. I'd wait til late this summer to look at the QQQQ. Wait til you get a stocastic crossover of the MACD.

Answer 5

This penny stock service has years of proven experience. Ultimately it is the best service for beginners to use https://tr.im/P1hTF
You will have to wait between 3 and 10 days to get into the system in most cases. When I signed up it took 8 days. I wished it was faster, but if you can wait a week or two to start earn life changing money than you will have what it takes to make it in this business.

Answer 6

ShareBuilder and Scottrade are too expensive for you.

I suggest you TradeKing, SogoInvest or Zecco.

Answer 7

Go with Trade King. Sharebuilder charges arm and leg to sell.
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