Exchange Traded Funds vs. Stocks | How to build an ETF Portfolio

ETFs offer many advantages over investing in individual stocks:

• The most important advantage is diversification. With an ETF you hold a portfolio of many individual stocks rather than just one stock.
• With an individual stock you are exposed to the possibility that one of your stocks could be hit by bad news and plummet in price. It takes a long time to recover from one of these massive hits.
• With an ETF when one of the stocks in the portfolios is going down it is not at all unlikely that one or more of the other stocks in the portfolio are going up.
• Professional managers, with tremendous resources at their disposal, are managing the individual ETF portfolios. It is difficult, if not impossible for the individual investor to develop that level of sophistication and diversification when investing in individual stocks.

How to build an Exchange Traded Funds ETF Portfolio

• You could buy and hold a diverse number of individual ETFs. While this would give you good diversification there is a better way to invest in Exchange Traded Funds to maximize your return on investment.
• The preferred alternative is to follow a time-tested system for buying and selling a portfolio of ETFs.

Rebound Trading Systems Investment Methodology

• Step 1:
  A proprietary momentum model ranks over 200 Exchange Traded Funds in its universe. These funds are ranked based on their respective momentum over multiple time frames.
• Step 2:
  Once candidates for purchase are identified in the momentum ranking model, they then must jump 3 proprietary technical analysis hurdles before they can be considered for purchase.
• Step 3:
  A strict stop loss and profit-protect discipline is utilized for every trade.
• Step 4:
  ETFs are sold when they hit their respective stop loss or profit-protect points. They are then replaced with the highest ranked ETF. This approach to investing systematically upgrades your portfolio to the best performing ETFs available.

Mutual Funds Trading System

Exchange Traded Funds ETF

Rebound High Five