3 minutes a day
Accompany you to make money in the US stock market!
The representative of Niuniu class is coming!
Today is the 10th lecture in a series of courses "20 lectures on American Stock Investment".
Niu friends, please pick up the small bench and come to class together.
Follow in Buffett's footsteps and take a look at what ETF is and how to trade ETF.
According to the US ETF analysis website ETF.com: the global ETF scale first broke the $6 trillion mark in November 2019, among which the United States, the largest ETF market in the world, had a net inflow of $326.3 billion in 2019; the total assets of all ETF listed in the United States were as high as $4.4 trillion.
Even Buffett's Berkshire Hathaway's 13F position statement shows that the company held in the fourth quarter of 2019.S & P 500ETF-Vanguard (VOO.US) $和S & P 500 ETF-SPDR (SPY.US) $This is the first time that Berkshire has bought the ETF index fund that Buffett has recommended to the public many times.
Let's follow in Buffett's footsteps and take a look: what exactly is ETF and what are its characteristics? How to trade?
What on earth is ETF?
ETF is the abbreviation of Exchange Traded Fund, also known as "Exchange traded funds」。This is an open-end fund that tracks market indices and can be traded freely on a stock exchange like stocks.
Issuers buy different stocks, merge them together to form funds, and then divide them into small pieces and sell them on the stock market. They become ETF index funds that can be bought and sold freely, and investors can buy a basket of stocks at a relatively low cost.
The popular understanding is that ETF = trading + index + fund.
Trading: ETF is a trading fund that can be traded on the secondary market on the stock exchange, and ETF can buy and sell as freely as stocks.
Index: ETF is an index fund that tracks a specific index. When the index rises, ETF will rise, and the increase is basically in line with the index.
Fund: ETF is an open-end fund for in-kind purchase and redemption. buying ETF is equivalent to buying shares of many companies, so you don't have to worry about individual stocks, just analyze the trend of the industry or the market.
For example,S & P 500 ETF-SPDR (SPY.US) $It's the ETF that tracks the S & P 500.
SPY has been listed on the New York Stock Exchange since 1993. The annual rate of the ETF is only 0.11%, the cumulative tracking error is only 0.14% since its inception, and the market discount premium rate has been maintained around 0.01% for a long time. All aspects of SPY data are perfect and are sought after by ETF investors.
By the close of trading on September 1st, SPY's assets had reached 308.33 billion yuan.
6 reasons to choose ETF
Why do people buy ETF? Is it the stock market that doesn't smell good? Isn't it fun to be a nest wheel?
In fact, different investment tools are suitable for different investors and investment scenarios. The class representative is here to introduce to you the major features of ETF:
1. Avoid the trouble of stock selection
With so many countries and enterprises in the world, it is impossible for us to compare and study all of them. ETF is a sharp weapon to avoid stock selection.
2. Diversification of tracking targets
Whether you want to cross-market investment, or want to invest in crude oil, foreign exchange, fixed income and other different products, whether you want to take the "Buddhist" route or the "radical" route, whether you want to short or long, the ETF category is rich and mature, you can choose.
3. Steady investment and risk diversification
Because ETF is a kind of open-end stock fund tracking market index, buying ETF is equivalent to buying an index portfolio and buying a basket of stocks. As long as there is no problem with the general trend, the return is relatively stable.
4. the transaction cost is relatively low.
The handling and management fees of ETF funds are slightly lower than those of traditional index funds, and they do not have to charge as much management fees as public funds and do not need mines at home to afford them.
5. High transparency
Public funds and hedge funds are opaque, you have no idea what the fund manager is buying, and ETF's passive management is very clear.
6. Convenient transaction and good liquidity
ETF fund trading in the secondary market is basically the same as stocks, can be bought and sold in the market, and can better grasp the gains and losses, combining the characteristics of ordinary open-end funds (which can be purchased / redeemed at any time) and closed-end funds (which can be traded in the secondary market).
Note: the specific transaction fees are related to your current US stocks on Fortune Road.Charging schemeKeep consistent
How to trade ETF
In this class, we take Futu Niuniu APP as an example. Three steps to get!
Step 1:Click "Market-Market-US stocks" in Futuo Niuniu, slide to ETF, click > on the right, you can view any type of ETF.
Step 2:Go to the single ETF quotation page and click "Analysis-profile" to view ETF information.
Step 3:After clicking the "deal" button in the lower left corner of the quote pageSelect the type, duration, pre-and post-market, and enter the price and quantity, etc.The transaction can be completed.
Matters needing attention
ETF is related to the movement of the relevant index, so both price and value can rise or fall.
ETF may trade at a premium or discount to net asset value.
The net asset value or transaction price of ETF may fall below the investor's purchase price, resulting in a loss below the investment principal.
ETF does not completely copy the trend of the relevant index, and there is a certain tracking error.
If the reverse / leveraged ETF is held for more than one day, the compound effect of the one-day return may deviate the investment return from the reverse or positive leverage multiple of the cumulative performance of the relevant index.
Through the secondary market trading unpopular ETF should pay attention to liquidity risk, try to avoid small trading volume of ETF.
Recommended courses related to Finance School:
Finish reading this article
Do you still want to know which popular ETF are favored by investors?
Then look forward to tomorrow's lesson:
"invest in US stocks, you must want to know about these hot ETF"!
Welcome to the message area for interaction!
The class representative will select 8 high participation friends in the discussion area and give 188 Niuniu points!
In addition, if you have any thoughts on the current and future courses, please don't hesitate to tell us!
Review of the previous issue of "hand-in-hand teaching you to invest in US stocks":
1、Review of one articleUs stock marketThe vicissitudes of a hundred years!
3、3 minutes of popular scienceUs stock tradingAll-round strategy
4、Understand the American securities market in one articleSupervision and controlSystem
5、Teach you how to do it for 1 minute.Get information about the US stock market
7、Listen to Buffett buy an index fund. Let's learn about it first.Us stock indexComposition!
8、Before you hit the big player, take a look at it.Us stocks are new.Introduction
Lecture 11 tomorrow, waiting for you to come!
Don't break up until we see you!
Edit / iris lydiali