Exchange Traded Funds (ETF)An Exchange Traded Funds is a stock fund that trades similar to a stock. Basically the ETF is a fund that holds a bunch of companies maybe a few dozen in the fund. The fund is then given a stock symbol and is traded just like an individual stock. One important characteristic of an ETF is that it's usually a basket of stocks in one particular industry such as Oil (Exxon, Shell and Mobil) or Tech (Microsoft, Dell and Cisco). You may have heard of some of these ETF’s on TV, but you have no idea of what they are. Some of the more common names are; Spiders, Diamonds and Cubes. There are plenty of ETF's available. If you're interested in investing in places like Europe, Asia and other countries there are ETF's for foreign countries. An ETF represents every aspect of the investing realm. If you’re partial to a particular industry or country, I'm sure there is an ETF out there that can serve your investment needs. If you're interested in Exchange Traded Funds, please do your research and then invest according to your risk tolerance. Visit an online broker such as TD Ameritrade or Scottrade and buy the exchange traded funds by simply entering the stock symbol of that particular ETF. Please keep your cost down and don't day trade. An ETF offers an excellent way of investing. Sometimes we buy a stock, but we also want another stock that is in the same industry. The ETF is the way to go. Remember that exchange traded funds are similar to a stock mutual fund, but mutual funds are not traded daily on the Stock Market. A mutual fund company and it's manager will buy a company stock and then buy another stock (but in hundreds of thousands or even millions of shares) to add to it's fund family. However, you can't trade a mutual fund because of rules that are in place by the Security and Exchange Commission, SEC. An ETF gives the investor more control over their investing style and preference. Popular ETF's include, energy, agriculture, metals and other similar commodities. These types of ETF's will play a critical part in the way we get our food and other materials.
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