Benefits
Benefits of trading ETFs:
- ETFs rarely require aggressive management. ETFs are designed to follow, versus outperform, an index. As a result the risks are lower.
- ETFs are generally inexpensive compared to some other types of investment vehicles. Commissions tend to be lower because there is only one transaction per trade, therefore you incur less fees than regular mutual funds.
- Capital gains for ETFs are taxed lower than mutual funds. The structure of the trade allows for this. Individual capital gains from ETFs are not taxed until assets from the entire fund are sold, unlike mutual funds.
- Most ETFs list options and futures contracts. This can be a wonderful tool for portfolio risk-management.
ETF drawbacks:
- As with other investments, investing in ETFs requires research. Some ETFs may cost more than others and you generally want to seek out investments with a low expense ratio to minimize your costs.
- Despite ETFs being considered economical compared to other investments, brokerage fees paid each time an ETF is bought or sold may become expensive.
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Hi Big A,
It’s been a blessing reading and listening to your videos and articles. I’ve been burned big-time so many times in the past and am very gun shy now – but continue to learn and grow from my past mistakes. My own researched picks have been up over 100% the last 6 months – but still I need a mentor to be able to learn and produce income on a long term consistant basis. Like yourself, I value my time and family – and my wife and I need that time and freedom to continue our non-profit international charity without begging others for our daily needs. I’ve always been attracted to the business world and what’s going on in the market for the last 25 yrs+, now it’s time to begin producing a self-sustanable income to have the freedom to help others. I’d like more details on your mentor program and DVDs – recently I’ve been looking at Larry Connors system, what do you know about him? Kind regards.