A relatively new investment product is quickly becoming the investment of choice for today's global investor. Exchange Traded Funds (ETFs) are perhaps the most innovative product introduced since the advent of mutual funds more than a half-century ago.
First introduced in 1993, ETFs offer many of the advantages of mutual fund, including diversification and access to overseas markets, but they trade like common stocks and are listed on global exchanges.
More About Exchange Traded Funds
Volatility Returns to Markets with a Vengeance: Here’s How to Profit
By Mike Burnick
According to Bloomberg, in less than four weeks starting on July 20, global equity markets dumped about US$3.4 trillion in value. The Morgan Stanley Capital International World Index sold off more than 10% since reaching a record high July 19th.
Fixed income markets also tumbled; with the exception of safe- haven buying in U.S. Treasuries and other top-rated bonds, as the market for mortgage-backed securities came to a virtual standstill. Investors who have grown accustomed to one-way bets on the long side of the market got a quick lesson in risk management. Not many asset classes we re spared from the sell off. Global stock and bond markets slumped, and even high-flying commodities got caught up in the selling panic.
This episode makes me thankful for the variety of hedging strategies available to individual investors today — especially using innovative exchange traded funds. On of the most pioneering providers in this realm is ProShares, which sponsors a series of inverse and double-inverse ETFs designed to rise in value when global markets fall.
Yet these securities can be purchased in an ordinary stock brokerage account. In fact, some of these funds give you leverage of 2-to-1 on your money (both long and short) without ever needing to open a margin trading account. Now that’s financial innovation for you!
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How to Earn a Double-Play of Potential Gains Offshore
by Mike Burnick
The exchange traded fund universe continues to expand globally. If you're a U.S.-based investor, and you're serious about diversifying outside domestic markets - and away from the sickly U.S. dollar - then that's a very good thing indeed.
The European ETF industry is on fire right now with new fund listings. Last year, the number of ETFs listed on European exchanges reached 412 total fund offerings, "with plans afoot to launch a further 59," according to the Financial Times.
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Time to Get Selective with Your Commodity Plays
by Mike Burnick
In the current commodity bull-market cycle, the time has come for you to be more selective with your commodity plays. A "shotgun" approach won't work as well in 2008 and beyond. Instead, you should consider a "rifle-shot" strategy for investing in commodities to target the biggest gains.
Fortunately, the ever-growing landscape of exchange traded funds (ETFs) gives you a great opportunity to zero in on some specific sectors of the commodity market, to zero in on potentially bigger gains. Let's take a quick look at the growing lineup of commodity ETFs...
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