Why ETF Trading Is Outperforms Index Mutual Funds

By Chris Channing

ETF Trading, or exchange-traded fund, are quickly becoming a better option in investing than what investors are accustomed to. An exchange-traded fund is able to achieve certain benefits in taxing, trading, and overall costs of a transaction thanks to the basic design they follow.

With fewer taxes, you would be able to keep more money into your investments. Unfortunately this isn't valid in trading your average stock options, but is with exchange-traded funds. ETFs, like other stocks, must fore-go a taxation on capital gains. The difference is that with an ETF, you are able to delay the taxation until the end of your fund's life, meaning you can keep your money in your investment longer.

The investing day comes to a close once the stock market hours have been played out- but only for investors who don't have exchange-traded funds. ETFs are able to be traded at any time, outside of stock market running hours- which is a great benefit for investors who like to constantly monitor their stocks so that they can make informed decisions on their next move.

Brokers all agree that the exchange-traded fund is a great method of investing your money, and just as easy as you would trade any other stock. ETFs are not the easiest to understand in how they are developed, but trading them is done just like stock you likely already have in your investment portfolio. It's recommended you give them a shot, and not be intimidated by something you aren't familiar with until you have tried it.

The way many investors get into investing in stock is that they are familiar with a certain area of business. This could be something such as mining for precious metals. The interesting part of exchange-traded funds is that they are able to be traded among many different areas of business. More surprising is the fact that they aren't limited to stock- they are securities that can be applied to real items that can be liquidated.

ETF trading is still a risky business, regardless of the clear benefit they offer to a trader. It is still recommended that you obtain the proper investment broker to aid you in the process of learning more about ETF trading and the processes it entails. Published materials such as books can also help you in the quest for taking advantage of ETFs while they are still relatively untapped.

Final Thoughts

You should get more information on exchange-traded funds more for knowledge on the subject, so that you too can get in on the money being made everyday. Talk to your broker for more information on how to get started. - 23199

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Fundamental Trading Strategy Based on Interest Rates

By Ahmad Hassam

As a forex trader, you should know that interest rates are an integral part of investment decisions and can drive the currency markets as well as the stock markets either direction. Federal Open Market Committee rate decisions are the second largest currency market moving release behind the unemployment figures.

The impact of interest rate changes not only have short term consequences but also have long term consequences on forex markets. One Central Banks interest rate change decision can affect more than a single currency pair in the interrelated currency markets.

In currency trading, an interest rate differential is the difference between the base currency interest rate and the counter currency interest rate. In the pair, EUR/USD, EUR is the base currency and USD is the counter currency. The interest rate differential for the EUR/USD pair will be the difference between the Euro interest rate and the US Dollar interest rate.

Understanding the relationship between the interest rate differentials and the currency pairs can be very profitable. In addition to the Central Banks overnight interest rate decisions, expected future overnight rates as well the expected timing for the rate changes can be critical to the currency pair movements.

The reason why this is profitable is that international investors like big banks, corporations, hedge funds and institutional investors are yield seekers. They actively keep on shifting their funds from the low yield assets to high yield assets.

Interest rate differentials are considered to be the leading indicators for currency prices. London Inter Bank Offer Rate and the 10 year government bond yields are usually used as leading indicators of currency movements.

Lets take an example, suppose the Australian 10-year government bond yield is 5.25%. The US 10-year government bond yield is 1.75%. The yield spread in this case would be 350 basis points in favor of the Australian Dollar.

Suppose the Australian government raises its overnight interest rate by 25 basis points. The Australian 10 year government bond yield would appreciate to 5.50%. Now, the new yield spread between AUD and USD is 375 basis points in favor of AUD. The Australian Dollar will also be expected to appreciate against US Dollar.

The general rule of thumb is that when a yield spread increases in favor of a certain currency that currency is expected to appreciate against other currencies. This information should be very important for your trading. Use the data available on Bloomberg to keep track of currencies in the currency pairs that you trade. - 23199

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. He is interested in day trading and swing trading stocks and currencies. Learn Forex Nitty Gritty. Read about Trend Forex System. Try Netpicks Forex Signal Service.

What is the South African Krugerrand Mini Gold Coin - Is It Valuable?

By Christina Goldman

Is the South African Krugerrand Mini Gold Coin is an authentic gold bullion coin? It is similar to the very popular South African Krugerrand gold bullion coin but perhaps it is a ripoff of the very popular South African Krugerrand Gold Coin?

You are still sane so don't worry. What you have just encountered are authentic reproductions of the bigger Krugerrand gold bullion coins. What makes them extraordinarily appealing to collectors and investors as well are its practical renditions of the much expensive version.

Since gold is once more climbing to levels that have never been experienced before, taking the South African Krugerrand Mini Gold Coin and adding it to the list in your investment portfolio would be a great move. And why is that? You see the mini gold coins have a weight of an approximated .50 grams. It's got a 10mm approximated size in diameter.

It gets better when you find out that their composition rates actually varies from 6K to as high as the first 22K. If you have plans on acquiring some, it is best to follow the golden rule in purchasing by the volume. The more pieces you buy, the lower the cost goes right?

Keep in mind that you could have stumbled on a good deal in the internet but be cautious with its veracity. There are no silver Krugerrands in the market. Do not let these people trick you into purchasing these products. It is best to educated yourself on the coin's identity like for the oz mini ; it has 150 reeds ; 140 for the and 1/10 ounces.

Before you bring the gold coins home to show to your folks, it would be best to do your own research first to make sure you're bringing home pieces of the South African Krugerrand Mini Gold Coin and not gold covered chocolate mini coins. - 23199

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You can find wonderful prices and selection on the unique South African Krugerrand Mini Gold Coin at: http://GoldKrugerrand.net

Retirement and Online Stock Trading

By Owen Jones

Retirement brings the retiree more time and usually, less income. However, the discovery of the Internet has brought about many changes in the way that people conduct their lives, hobbies and business. You can pay your bills online, do your shopping online, do your banking online, and even date online!

You can also participate in online stock investing, which I think, could fit in nicely. Online stock investors love having the ability to look at their investment accounts whenever they want to, and online stock brokers love having the capability to take orders over the Internet, as opposed to using the telephone.

You can start by reading the newspapers and watching the news with a view to gleaning information that could benefit a company. Any news items that suggest good news for a company can be followed up by greater research into the company concerned. The majority of stock brokers and brokerage houses now provide online company research to their clients as well as online stock trading. Another great thing about online stock trading is that fees and commissions are usually lower. While online stock trading is good news, there are a few drawbacks too.

If you are brand new to trading, having the ability to actually speak with a stock broker can be very beneficial. If you aren't experienced in the stock market, online stock trading may be a rather dangerous thing for you to do. If this is the case, make sure that you learn as much as you can about trading stocks before you start 'live'online stock trading.

You could run a dummy portfolio. For example, most online stock brokers offer the facility to run a 'watch list' or dummy portfolio, where you can 'buy and sell' without risking real money.

You ought also to be aware that not everyone has a computer with Internet access with them all the time, although many mobile phones can get online, so you may not always have the ability to get online to make a trade. You will need to be sure that you can call and talk with a broker if you use an online stock broker. This is the case whether you are an experienced stock market trader or only a beginner.

It is a good idea too for the retired person to sign up with an online stock broking firm that has been around for a while. Naturally, you won't find one that has been in an online business for 30-50 years, but you can find a company that has been in business that long and that now offers online stock investing.

Sure, online stock trading is a fantastic thing for the retired - but it is not for everyone, the impetuous can lose money quickly. Think long and hard before you decide to go for buy stock online, and be sure that you really know what you are doing!

Therefore, in summary, retirees can use their newly-found free time to investigate the stock market free by finding leads in newspapers, magazines and news programmes. These leads can then be followed up by online research with the help of a free online stock investing account.

These hunches can then be tracked using a dummy or trial portfolio. When you have gained sufficient experience, you can go 'live' by opening an active online stock investing account. - 23199

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If you want to know more about online stock investing, please go along to our website Online Stock Investing for Retirees for more information.

How do Stock Prices Change?

By Robbin Carols

When you buy stocks, you have two ways to make money. You can make money through dividends that the company pays for each share you own. For example, they might pay 25 cents per share each quarter. Dividends are not guaranteed, though.

You can also earn a profit through capital gain. When you buy stock, you will pay a certain price. If in the future the price goes up, and this is what you want it to do, you can sell it and make a profit. Subtract what you paid for what you sold it for and this is your capital gain.

When investors purchase stock, they are doing it in hopes of making capital gains. Those in retirement usually look for dividend paying stock because it is a stable source of income. Otherwise, dividends are just a bonus to the investment.

You can't make capital gains unless the price goes up. (unless your selling short, but that's an entirely different idea) Stock prices are always changing and can go up or down. What makes them change?

The price of stocks goes up and down the same way that the price of anything else goes up and down. It is an economic principle of supply and demand. Maybe you remember that from your economic class.

An increase in supply with the same demand will decrease the price. An increase in demand with the same supply increases the price. The price changes depending on whether and how supply and demand change.

With stocks, if a lot of people want to buy a particular stock and not enough people are selling, they will have to raise the price to accommodate for it. If there are more people looking to sell than people willing to buy, they will need to decrease the price to get people to buy.

If you understand how this works, you can better understand how to make money with stocks. You want to buy stocks that you think a lot of people will be buying in the future so that the price goes up. - 23199

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Do you want to know how do stocks work? Find out if you should choose the stock market or bond market to invest in.