ETFs vs. Stocks

Trading ETFs can be a very profitable thing to do. There are a few major advantages to trading ETFs that you would not have if you decided to trade stocks.nn1. ETFs come with less surprisesnnIf you have ever traded stocks you have probably noticed that you can get some surprises now and then. You might buy a stock for $40 and it slowly goes up to $50 within 2 weeks then some extremely bad unexpected news comes out and it falls back to $40 in 1 day. nnIt can happen a lot, and you have to definitely be aware of it. But the good news is that ETFs track a number of stocks. If 1 company announces some bad news it will not affect the ETF that drastically. So you are able to avoid many surprises this way.nn2. Don’t have to look for individual StocksnnLet’s say you are bullish on healthcare. Rather than going and looking at a ton of different companies that offer services related to healthcare and trying to find the best you can simply buy an ETF that tracks the performance of health care. nIt is the same with almost; if not every industry group you can think of.nn3. You can buy short ETFsnnIf you are not able to short stocks in your account or if you do not feel comfortable doing it for whatever reason you have a second opportunity to profit as the prices of stocks fall. You can buy inverse ETFs. These allow you to profit from the market as stocks are falling.nnMost people have been losing money recently, but there has still been plenty of money to be made in this market. With short ETFs you can take advantage of that. Provided you have a solid trading plan to go along with them.nnFor more on inverse ETFs or other ETFs visit http://www.stocks-simplified.com/What_Are_ETFs.htmln