Home Page - View Our Latest 2009 Updates Inc Free Stock & ETF Reports.
The Yahoo website: http://finance.yahoo.com/etf/education provides a thorough guide to what ETF’s are and how you can trade the ETF. There is also plentiful information on ETF's which are simply shares you can trade (just like stocks) on index movements.
A Dow Jones ETF is also better known as “Diamonds” with the ticker symbol “DIA”. Click Here to view a quote.
In very simple terms, ‘Diamonds’ are almost
exactly like stocks. Through a complex mathematical equation, an ETF is
a stock you can buy/sell, which already contains a ‘basket’ of all 30
stocks that make up the Dow. Therefore, whenever the Dow moves up, so
does the Diamonds ETF. Whenever the Dow moves down, so does the Diamonds
ETF. In other words they both correlate.
This allows you to simply buy [or short] the Diamonds whenever you get a BUY or SELL [short] signal on the Inter Market Strength indicator, just like you would simply buy/sell a standard stock like Microsoft. It is this simplicity, which has made the ETF a firm favorite amongst stock traders who want to buy or sell an index easily, and prefer to trade an ETF rather than a future such as an E-Mini. We still prefer to trade E-Mini’s, but this is simply a matter of choice/opinion.
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