How To Guide For: Exchange Traded Funds (ETFs) For Beginners -- What To Know Before You Start Tradin

An ETF - exchange-traded fund is an investment fund traded on stock exchanges, much like stocks. An ETF holds assets such as stocks, commodities, or bonds, and trades close to its net asset value over the course of the trading day. Most ETFs track an index, such as a stock index or bond index. ETFs are essentially Mutual Funds. ETFs have many advantages one being diversification. Diversification minimizes risk without affecting returns. Another advantage is that an ETF allows

investors to trade the entire market as though it were one single stock. ETFs can be sold short -- a way of profiting if the ETF price drops instead of rises. Another thing to keep in mind about ETFs is that the fees for ETFs are often, not always cheaper than index funds, and they may cost you less in taxes. If you're considering trading ETFs for the first time there are some things you should keep in mind. First what are you trying to accomplish. Look at what your options are. What ETFs are available that meet your particular investment need. The way your ETF makes money depends on the type of investments it holds. The reason why I am discussing ETFs is because someone asked me what I thought about buying and trading gold now with all the future interest rate hike discussions and recession talk. Gold is a good way to diversify your portfolio. It also depends on the type of gold you're considering. Are you thinking about physical gold, paper gold or bullion ETFs. I'll save the gold discussion for another day. Right now lets just focus on ETFs -- there is so much more to learn about ETFs and what beginners should know before they start trading ETFs. To get more in depth information -- click the pictures below to read the articles.