Basics, Tips & Strategies

The worlds most powerful industry is the gold industry. Presently, gold mining is one of the most profitable economic activities. In light of these revelations, it is normal for someone to want to know how to benefit from the gold boom without necessarily being involved in gold mining activities or any activity that involves handling physical gold. The answer to having a stake in the multi-billion gold industry lies in gold ETF. This financial instrument is traded everyday in leading stock markets such as New York, London and Hong Kong stock markets.

What is an ETF?

What is an ETF is a question usually asked by those who are starting out in exchange-traded funds. A fund that tracks the price of something such as gold, silver and commodities is ETF. Normally, real assets that have been stored somewhere are backed exchange-traded funds. In the case of Gold ETF, they are backed by over 2000 tons of vaulted gold that have been stored in private and government storage facilities found in different parts of the world.

ETF with High Trading Volume

One of the fastest-moving high volume ETFs in most countries is Gold ETF. To be successful with exchange-traded funds one has to be good at spotting potential trading opportunities, weeks ahead. As a person becomes more engrossed in ETF trading, it will be possible to learn, muster and sharpen trading skills and competencies. While on the path of learning the inner tactics of the game, it is possible to make a mistake or two. Learning from mistakes is crucial so that to become good at trading exchange-traded funds such as bank stock ETF.

Because gold ETF has high trading volume, it is the most profitable ETF that a day trader can handle. More than 5 million gold ETFs change hand daily and this creates a great opportunity for speculators who like to make quick gains in the course of financial markets. Someone people who opt for this investment vehicle have the desire to make source of short-term gains. However, gold ETF can also form part of a portfolio that is part of a long-term investment strategy.

Tactic #1: Advanced Tactics

The world of active Gold ETF trading requires the use of precise and advanced trading tactics to make gains.  Active traders of exchange-traded funds know how to harness the power of pivot and reversal tactics while trading bank stock ETF and other exchange-traded funds.  Another important tactic one must learn is setting specific entry and exits for what is moving in the market of Gold ETF.

Tactic #2: Read Gold ETF magazines

It is important to learn what works best in the market of exchange-traded funds.  Reading the opinions of the most thoughtful traders in the world of Gold ETF will help someone to know more than what is an ETF. Information obtained from trade publications such as ETF magazines that have a bias for topics such as gold ETF and bank stock ETF, in order to know how to execute million dollar trades.

Strategy #1: Monitoring trends

There are many ways that an investor can gain money with gold ETF. Having the right day trading strategy is what will facilitate profitability. The best strategy involves monitoring the movement of gold prices in order to know the best time to buy and sell. Staying constantly updated on market conditions and general happenings in political and economic spheres is what will facilitate success. By keeping a close eye on what is doing rounds in world politics and stock market trends one will know when to short sell in order to make speculative gains. Timing is an important aspect when it comes to ETF trading.

Strategy #2: Making Maximum Use of ETF Charts

Usage of gold ETF charts is an actual trading mechanic used by real traders.  There are dozens of current-market stock charts. It is important to learn how to use these charts to facilitate ETF trading success.

Why trade Gold ETF and not physical gold

It is risky & costly to handle physical gold as an individual investor. Storing precious metals at ones house makes them to be prone to the risk of burglary. On the other hand, buying gold bullion as an individual investor and storing such gold in a commercial facility is a costly affair that may not be worth the cost.  Only corporate and institutional investors have the resources and capacity to deal with gold bullion.  For the case of an ETF, one will not feel the burden of storage. This is because many people who have invested in an exchange-traded fund will share the costs of storage therefore; it will end up being negligible.  To minimize the risks and maximize gains when dealing with precious metals, one should invest in gold ETF and other exchange-traded funds once one is knowledgable.

To be successful when dealing with ETFs. it is important to track vital gold indicators. Information is power. Traders with the best information are the ones who emerge winners in financial markets.