Sunday, August 7, 2011

Traditional ETFs (8 Aug 11)

Traditional ETFs

A Traditional ETF is essentially an index fund that trades like a stock.  There are traditional ETFs covering everything from broad stock indexes to individual commodities.  These ETFs are useful tools for inexpensively diversifying your portfolio, and they are available in all major asset classes.  If you generally like to pick individual stocks but you don’t know much about a certain sector or region, you could use an ETF to complement your stock allocation so that you’re more broadly diversified.

iPath S&P 500 VIX (VXX) $30.31
Profit Target (10%): $33.35  
Trailing-Stop (ATR x 2): $3.56

SPDR Gold Shares (GLD) $161.75
Profit Target (10%): $177.95  
Trailing-Stop (ATR x 2): $4.02

iShares 20+ Year Treas Bond (TLT) $102.32
Profit Target (10%): $112.55  
Trailing-Stop (ATR x 2): $3.34

Smart investors love diversification and low costs, and ETFs have a well-deserved reputation for both.  With these facts about ETFs in hand, you can intelligently decide what role ETFs might play in helping you to reach your financial goals.

All positions displayed are for educational purposes only and are not intended to be recommendations.

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