The best EFT trading strategies for beginners

E xchange-traded funds (ETFs) are market security that tracks a commodity, index, bond or a basket of assets like index fund. ETF trades like a common stock on a stock exchange. To insure great profits, etfs strategies to implement are as listed The fist strategy is the dollar cost averaging which is when you invest a certain amount of money in a certain security on a regular basis regardless of the price when you buy, this is a great way to reduce your risk if you want to invest a large lump sum in a single security, this will ensure that you accumulate more units when the ETF price is low and fewer units when the ETF price is high, thus averaging out the cost of your holdings. The second strategy is the asset allocation, asset allocation is all about allocating your money to different asset classes and that’s finding the right portion of stocks, bonds and cash for the purposes of diversification, it is a powerful investing tool since you will be getting your profits from multiple sources. Thirdly, Swing trading, it takes advantage of the sizeable swings in stock or other instruments like commodities and currencies Trades generally need time start working out, and if you keep a trade open for a few weeks and days the profits results are prone to be high than trading a single security multiple times a day. Hedging an investment is a way of attempting to insure against a negative event happening. Let’s say you invest in a security and you expect the security to go up but it fails and goes down hedging prevents you from suffering the negative impact hence guaranteeing you profits.