5 Exchange Traded Funds to Help You Diversify Without Mutual Funds

Introduction

Fortunately, exchange traded funds provide an alternative to mutual funds for the independent investor. Like mutual funds, exchange traded funds track multiple stocks or bonds in a single fund. But what’s nice about exchange traded funds is that you can trade them just like individual shares of stock.

  1. S & P 500

One of the best ways to grow your capital over the long term is to invest in large-cap companies. If you had enough time and money, you could buy shares in each of the S & P 500 companies, but that’s something out of reach for most of us. Fortunately, exchange traded funds can make this type of investing feasible. You purchase shares in a fund which in turn invests the money in S & P 500 stocks. The price of the shares is indexed to the S & P 500, so as the S & P 500 grows (or declines) the value of your shares grow or decline with it, giving you a way to track the overall progress of the stock market. One exchange traded fund which does this is the SPDR S & P 500 (SPY), an affordable way to start investing in the S & P 500.

  1. The Dow Jones Industrial Average

In today’s market the Dow Jones Industrial Average, which tracks the 30 largest companies, isn’t considered the best overall indicator of market performance (the S & P 500 is considered by many to have taken over that role). Even so, the Dow still plays a role as one of the major indicators of the overall stock market performance and state of the economy. If following the Dow Jones Industrial Average is to your liking, then one exchange traded fund that’s available is the Dow Diamonds Fund (DIA).

  1. Gold Shares

Looking to take advantage of the exploding gold market, but don’t want to store gold bars in your home? Exchange traded funds that follow prices of precious metals give you a way to do that. Examples include the SPDRS Gold fund (GLD) and the iShares Gold Trust, both of which follow the price of gold bullion. Investing in other precious metals such as silver and platinum is also possible with exchange traded funds.

  1. Bonds

There’s an ETF for just about anything and this is great for the independent investor-because its an easy way to get into bonds. Any smart investor will have a diversified portfolio that includes bonds but unfortunately, buying bonds as an individual is a little bit harder than stocks and often requires larger investments. One very easy way to get around these problems is to find an exchange traded fund that invests in bonds that suits your liking. Take one example, Barclays Capital New York Municipal Bond Fund ETF (INY).

  1. Real Estate

Every portfolio should have a small amount invested in real estate, and an ETF is a relatively painless and inexpensive way to do it. One example is the SPDR Dow Jones Global Real Estate ETF (RWO). This fund follows a Dow Jones index which tracks global real estate. There are many other options which can be used to track different sectors of the real estate market. More details here: http://www.inlet-resources.com/why-choose-an-exchange-traded-fund-etf/


Conclusion

The variety of exchange traded funds available on the market is staggering. Here is a small sample of funds you could use to start building a diversified portfolio. By selecting the right asset allocation, you could develop your own fund that meets your goals such as growth, value, or interest income.

Why Choose an Exchange Traded Fund (ETF)

Why Choose an Exchange Traded Fund (ETF)

ETF investing is something which millions are looking into each and every year. You cannot blame investors for looking into ETF’s as they really appeal to many everyday investors. However, there are still many potential investors who remain a bit unsure as to whether or not they can actually benefit from ETF’s. Why should you consider choosing an exchange traded fund? Read on to find out what potential benefits you could get when looking to these today.

Fewer Costs (Including Taxes)

Trying to trade with ETF’s can be far easier and less costly overall. Anyone who wants to invest in them will find they don’t need a lot of money to get started which is ideal. Most people don’t have tens of thousands of dollars to start up with but with the exchange traded funds you don’t need a lot of money. Taxes will have to be paid for ETF’s but it is only when you have sold them and even then the costs are a lot more affordable. The taxes due on these funds can be reasonable compared to many other investments and that is another reason why people love them so. They can be somewhat cheaper and it will help those who don’t have thousands to put towards taxes too.

Why Choose an Exchange Traded Fund (ETF)

Easier To Understand

Investing is not easy at any given time and it can often be difficult to get your head around the most basic terms of trading. However, with ETF’s they can be far easier to understand and learn about. Most investors will be able to understand the basic concepts surrounding ETF’s and will be able to research their potential investments as well. That is another reason why so many are choosing these today and why investors love them so. ETF investing is quite popular and you can find it’s a great concept too. Learning about them doesn’t have to be so difficult.

Buy Any Time, Any Day

With the stock exchange and stock markets there are limits in terms of when and where you can invest. You aren’t able to trade once the market closes for the day and that can really cause some problems. However, with exchange traded funds you don’t have to worry so much about the close of the market. You can trade anytime you want to and without too much trouble either. This is why there are so many who look to these every day. You really aren’t faced with lots of limitations either. It’s going to mean you invest whenever you want to. It’s ideal.

Invest Wisely

ETF’s are the new trading craze and yet they aren’t as complicated as they appear to be. Yes, you need a good head to understand how and when to invest but in comparison to many other investment avenues, it’s pretty straightforward. These investments have given thousands the ability to invest without the hassle. Yes, there is still a lot to be learned but there is a real possibility of succeeding. That is why thousands have chosen ETF investing each and every day.

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The Drawbacks of Lifestyle Funds or ETFS

The Drawbacks of Lifestyle Funds or ETFS

Choosing a retirement ETF can be very common amongst millions. There are quite a few people today who look to the future and want to find a way to make their golden years a little more comfortable. Investing has become highly popular for many who want to retire with enough money to live comfortably. You cannot blame millions for wanting that as it can make life far easier for everyone. Lifestyle or EFT’s have become one major investment talking point as well but there are many who often find they aren’t all sunshine and roses. What are the potential drawbacks of EFT’s?

Short-Changing Yourself for the Future

For one reason or another, your funds can run out of money and that is not good. You could retire and within a matter of months, the money is all gone and then what will you do? Many people can end up short-changing themselves and running out of money is never a good sign. That is a major drawback of lifestyle funds and it’s more common than you think. The trouble is that these investments can be poorly managed and mismanagement is easily done. This has become a major problem for millions and it happens too easily in truth. EFT investing is good but it must be done right for it to work.

The Drawbacks of Lifestyle Funds or ETFS

No Growth

What happens if you don’t invest or that one day your money doesn’t grow? No growth within your ETF could result in you losing money. Again, you don’t want to lose out but it’s something which happens more often than not! It’s a major problem and it’s not going away anytime soon either. No growth can result in a heap of trouble and you will lose out. If you want a retirement ETF you have to be careful and understand there are many drawbacks. This is one which can be very disastrous for you.Get more,visit this link: https://www.telegraph.co.uk/investing/funds/build-income-portfolio-cheap-tracker-funds/

No Knowledge of ETF’s

ETF investing is simple but for many newcomers they don’t fully understand it and that can cause them to lose money. What is more, if investors don’t learn, they could find in years to come, they don’t have the cash they thought they should have. It can leave a lot of people at risk and it’s not ideal to say the least. The trouble is people don’t think about educating themselves on the ins and outs of ETFs. It’s going to cause a lot of problems and it’s easily done.

Be Aware Before You Risk Your Money

Anything can go wrong with investing, even with ETF’s and when they do, it can be devastating. You can lose everything you have and end up with very little money for your retirement. What is more, you might have to end up working until you are seventy or beyond in order to make up for what you’ve lost. A retirement ETF can be great but you must understand the drawbacks and risks before you put your money on the line so you can decide if it’s right for you.

How to Choose the Right ETF

How to Choose the Right ETF

Exchange traded funds are really quite popular. There are thousands of investors who want to get started on the right foot and who think ETF’s are the way to go. It’s easy to see why these have become as popular as they cost a lot less and they are easier to understand as well. However, choosing the right ETF remains very important and yet so many end up choosing the wrong one. It’s easily done but it can cause you a lot of trouble in the long-term and it’s not ideal to say the least. There are a few things which might help you choose the right ETF; read on to find about those tips.

Look At Its Past Performance

While you might think the current form of the ETF is looking good, you can’t use that to judge your trades! You also have to think about the past performance of your ETF’s and whether or not it’s really as strong as it appears now. If there is a history of dipping low before rebounding you have to know about that so you know if you want to proceed, when to make the right move. These things will matter and if you are not careful enough you could end up with a fund that doesn’t really work to your advantage. It’s vital to ensure you look at its past performance so that you can understand it a little better,Get more information Visit this link: http://www.netpicksetfinvestor.com

 

How to Choose the Right ETF

Think About the Economy and Strength of the Market

How stable is the economy right now? It can sometimes be hard to tell when the economy is going to take a nose dive but it’s also very important to think very carefully about it. Why? Well, if the economy goes south it can impact your exchange traded funds. Your investments can go horribly wrong if the economy collapses and it’s the same when something positive happens. You have to keep a close eye on the economy and think about where it really is now and how stable it is. Also, the strength of the market is important too and you can’t forget to keep an eye over that.

Think About Your Financial Goals and Be Realistic

You are not going to become a millionaire overnight. It doesn’t always work like that and while that might be your overall goal, you aren’t going to reach that quickly. You have to be more than realistic over your financial goals and where you want to end up. If you like the idea of investing in an ETF then you have to ensure you choose the right one. To choose the right one, you have to think about what you want to achieve and that means your finances. It’s vital to know these things so that you can reach the goals you want to.

Choose Wisely

Choosing the right ETF’s can be difficult. You have a lot of options to consider and you want to make the best choice so that you get the right trades. Far too many people don’t look for the right funds and end up facing an uphill battle to rescue their investments! You don’t have to do that as there are lots of simple ways to get a good ETF. Exchange traded funds can be your friend and it can be also far easier to choose the ones you want as well.