ETF Profit Driver - Another Reason To Favor Exchange Traded Funds

ETF Profit Driver takes investing in exchange traded funds to a new level, adding one more reason to abandon your old mutual funds in favor of ETF products. Bill Poulos has assembled a comprehensive method of managing a portfolio of ETF's in a manner that drastically reduces risks associated with market downturns, while dramatically increasing potential for sustained capital appreciation.

Based on a study conducted a few years back, about 10% of all long-term mutual-fund assets were held in index funds. Those funds offer comparatively low fees track indexes familiar to most investors. The drawback of index fund investing has been holding those positions during market downturns.

In the past several years Exchange Traded Funds have started opening up significant new investment strategies. While ETF behave much like traditional index mutual funds, they have key differences.

Two significant features differentiating ETF'sfrom mutual funds is the fact ETF's are traded on exchanges. Mutual fund positions are only opened and closed at the end of the trading day, while you will be able to quickly enter or exit an ETF position at any time during market hours. Many ETF's also have highly liquid options chains further expanding the flexible use of ETF's in your portfolio.

As a result of this expansion of ETF's, small investors are gaining access to a growing array of different exchange-traded index products. Each year, numerous new ETF's are launched, tracking everything from clean-energy stocks to the nanotechnology industry.

A key driver in the popularity of ETF's is the failure by many mutual-fund managers to beat the market for extended periods of time, even as they collect big management fees. Instead, many advisers have turned to a strategy of lower-cost index funds, and increasingly, ETF's.

ETF's rising attractiveness also stems from the mutual-fund trading scandals of recent years. Because mutual funds are priced only once a day, after the market closes, some insiders used strategies designed to profit at the expense of the little guy. ETF's are priced like stocks, however. This means tat they trade throughout the day and are not vulnerable to these scams.

While ETF's offer numerous advantages to the retail investor and trader, they do need to be used in an intelligent fashion. The most successful investors always have a well though out plan about when to get into the market, and when to get out. Finding safe entry points that favor an existing or developing trend, and exiting the market when that trend begins to dissipate, is what ETF Profit Driver was designed to do.

Article Source: http://www.home-based-profits.com

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