Sunday, January 16, 2011

Oil, Oil, Oil, but is the Market Getting Stronger?

A little definition

Briefly ETF’s (Exchange Traded Funds) are investment funds that can be traded like stocks. There are many different types. Some track Market Indices, such as  DIA tracks the Dow Jones Industrial Average (the Dow)

They can track various Commodities, Bonds, Currencies, etc.

Leveraged versions can produce 2X times what it is tracking (which can be twice as profitable or generate twice the loss), a leveraged version of the DIA (the Dow) is DDM.

There are also inverse ETF’s set up to do just the opposite. An inverse of the DIA is DOG. There is a leveraged inverse of DIA and that is the DDX

… there are enough ETF’s to make your head swim, but I LIKE ETF’s.

I much prefer them to mutual funds due to the flexibly of moving in and out as much as I feel I need to, when I like, without restrictions.

You can see what ETF’s hold by going to the Yahoo or other finance page, enter the symbol and take a looking at “Holdings”…. a good idea before you buy

You can also look at the performance of the ETF by the looking at its chart just like a stock…another good idea before buying


This week’s review of ETF’s still favors oil, such as OIH, XLE and its near twin IYE. I really like DIG, which is a leveraged Dow Jones U.S. Oil & Gas Index. (Tracked by IYE)

For Market Indices ETF’s, right now I like UWM, QLD, and RSU in that order. These are sure not likely to be long-term investments but they are working well right now.

For stocks this week I am looking at: EMC, (EMC Corporation develops, delivers, and supports information infrastructure) JPM (JP Morgan Chase & Co., a large bank) GE (General Electric Company) and IP (International Paper Company)

I am holding and will likely continue to hold for next week the following:

 APPL (Apple)

ARBA (Ariba, Inc, provides collaborative business commerce solutions for buying and selling goods and services)

AMAT (Applied Materials, Inc. provides nanomanufacturing technology for the semiconductors etc)

MON (Monsanto Company, provides agricultural products for farmers)

So where is the market heading?

Investor Business Daily’s Current Outlook is “Market in confirmed up trend” …and I am getting more confident in the Market

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