Lackluster ETF Showing
The exchange-traded funds told a story
of consolidation Thursday, with the downside and upside moves confined to low
single-digit percentages.
The Dow Jones Internet iShares
(
IYV |
Quote |
Chart |
News |
PowerRating)
lost 3.6%, the day’s sharpest decline among the exchange-traded funds. That down
move, however, was not substantially confirmed by the Internet HOLDR
(
HHH |
Quote |
Chart |
News |
PowerRating),
which gave up only 1.0%.
The Internet Architecture HOLDR
(
IAH |
Quote |
Chart |
News |
PowerRating)
gave up 3.3%, the Nasdaq 100 Tracking Stock
(
QQQ |
Quote |
Chart |
News |
PowerRating) 3.0%, the Cyclicals-Transportation
SPDR
(
XLY |
Quote |
Chart |
News |
PowerRating) 2.9%, the Broadband HOLDR
(
BDH |
Quote |
Chart |
News |
PowerRating) 2.5%, the Dow Jones
Technology iShares
(
IYW |
Quote |
Chart |
News |
PowerRating) 2.5%, the Software HOLDR
(
SWH |
Quote |
Chart |
News |
PowerRating) 2.5%.
On the upside, the Utility HOLDR
(
UTH |
Quote |
Chart |
News |
PowerRating)
gained 1.4%, the Dow Jones Utilities iShares
(
IDU |
Quote |
Chart |
News |
PowerRating) 1.3%, the Utilities SPDR
(
XLU |
Quote |
Chart |
News |
PowerRating) 0.9%.
The top field of all charts in this
commentary uses a logarithmic price scale and displays a 50-day price average in
red. In the second field, a
blue relative strength line represents the displayed security’s price
performance relative to the S&P 500. The third field displays vertical daily
volume bars in black with a 50-day moving average in blue for volume.
Exchange-traded
funds combine traits
of stocks and mutual funds. Like mutual funds, an ETF represents diversified
ownership in a number of different stocks, greatly reducing company-specific
risk. Like stocks, ETFs trade on exchanges, nearly all of them in fact trade on
the American Stock Exchange at present. They quote throughout the day, enabling
traders to take advantage of intraday price moves.
If you’re new exchange-traded funds,
be sure to visit TradingMarkets’ Knowledge Center,
dedicated to explaining the basics of trading and active investing in ETFs and
mutual funds. Just click on the Funds tab
near the top of this page, then click on the Knowledge
Center tab.Â
You also will find lessons on trading
exchange-traded funds in the Stocks Education area of TradingMarkets.com. In
particular, check out my three-part series on trading ETFs, starting with
Average Crossovers. I also recommend newcomers read my tutorial,
HOLDRs: Unique Opportunity And Risk.
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