How to trade and profit using Exchange Traded Funds (ETFs)?

how would you suggest and guide a new investor in the use of this investment tool?

ETFs are useful in trading sectors of the market rather than individual stocks. An ETF usually contains 20-50 stocks in a specific sector so it serves as a mini-mutual fund but trades like a stock. ETF generally have lower expenses than mutual funds.

Suppose you wanted to invest in the oil sector but wanted more diversification than just buying Exxon, you could buy an ETF like XLE and get your investment spread out over a number of companies.

Go to etfconnect.com and do research on individual ETFs.

ETF's are similar to mutual funds, but are traded like a stock. You can sell short and trade them throughtout the trading day.

Here is a link for excellent information on ETF's

http://www.morningstar.com/Cover/ETF.htm...

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