ETF Trading Strategies Revealed (Trade Secrets (Marketplace Books)) (Paperback)

by David Vomund (Author), Linda Bradford Raschke (Author) "Exchange-Traded Funds (ETFs) have exploded in popularity..." (more)
Key Phrases: relative strength report, price change report, performing sector funds, Bollinger Bands, Latin America, Steve Palmquist (more...)

Editorial Reviews

Product Description
Want to know how to trade the hottest new investment vehicle? This book reveals the secrets of profiting from a new and growing investment vehicle the Exchange-Traded Fund. Pulling from experts in the field like Linda Bradford Raschke and Steve Palmquist, this book has all the information you need to begin trading ETFs for profit: Learn the basics of ETFs; how they work, why they re growing in popularity, and how you can get your share of the profits. Discover the way to apply classic techniques to leverage your ETF investments for both the short-term and long-term. Study simple but highly effective mechanical ETF rotation techniques (style, sector, and international) that are now available to the individual investor. ETF Trading Strategies Revealed doesn t end there. Learn from long-time trader and founder of AIQ Systems, Dr. J.D. Smith, what it takes to mentally be the best. When you have the emotional discipline to follow his techniques, you ll find increased profits aren t far behind.

Product Details

• Paperback: 104 pages
• Publisher: Marketplace Books (October 18, 2006)
• Language: English
• ISBN-10: 1592802583
• ISBN-13: 978-1592802586
• Product Dimensions: 8.3 x 5.3 x 0.3 inches
• Shipping Weight: 4 ounces (View shipping rates and policies)
• Average Customer Review: 4.0 out of 5 stars See all reviews (20 customer reviews)
• Amazon.com Sales Rank: #73,912 in Books (See Bestsellers in Books)

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Customer Reviews

Most Helpful Customer Reviews

46 of 53 people found the following review helpful:

5.0 out of 5 stars Very practical and usable ETF trading strategies, December 16, 2006

By	tahoedenizen "tahoedenizen" (Incline Village, NV United States) - See all my reviews

This book is "worth its weight in gold" if you are serious about trading or investing using Exchange Traded Funds (ETFs). On first impression it seems like a pretty thin book (90 pages), and the heart of the material in Part III is just 30 pages. But in Part III you learn very simple, practical, back-tested rules and strategies for outperforming the market by rotating periodically to the best-performing ETFs. The book presents results (compound annual returns) from following these strategies from 1998 to 2006, ranging from 15-16% for style index rotation to 19% adding an international ETF, 20% for sector ETFs, and 26% using Fidelity sector funds. [...]

The hardest thing for many traders or investors to accept may be that such simple, mechanical strategies that require monitoring the market only once every other week (with variants once per week or once per month) can perform so well. They work, for these funds better than for individual stocks, because of persistence of trends within market sectors, and styles such as value vs. growth and large-cap vs. small-cap that last even longer. Many people want to use fancy indicators, and many traders are in the market for the action and are too impatient for this approach. But if your goal is to simply make money with less risk than the overall stock market, this approach is very practical and usable.

The other 60 pages of this book include an introduction to ETFs and how they work, two chapters on chart analysis -- one written by Steve Palmquist, a successful professional trader, and one where David Vomund interviews well-known trader Linda Bradford Raschke -- and a short chapter on trader psychology that presents the personal trading process used by Dr. J.D. Smith, founder of AIQ Systems. They are very worthwhile for their advice and antidotes to the traps that traders often fall into.

I know David Vomund and knew Jerry Smith personally, and have met Linda Raschke and Steve Palmquist -- these are four very good people to learn from. David Vomund, the author, manages money using these strategies, and writes and presents seminars for AIQ. He is rated by Timer Digest as one of the ten best market timers for the 10-year period ending December 31, 2005, and has appeared on the cover of that publication twice in this period. But none of this seems to go to his head -- David's philosophy is pretty simple, practical, and all about making money rather than trading excitement or fame. If you actually apply these strategies, this book should literally be worth its weight (just a few ounces) in gold, and potentially quite a bit more.

12 of 12 people found the following review helpful:

3.0 out of 5 stars Rotation strategies, March 26, 2008

By	Gadgester "No Time, No Money" (Mother Earth) - See all my reviews (TOP 100 REVIEWER)

The book's title is a little misleading. There's only one strategy that's "revealed" here, that of style rotation -- here style can mean "market cap groups" or "sectors," etc. The book is really slim, totaling about 90 pages, of which only 30 are truly useful. The other 60 pages are just fluff. The ETF introduction chapter is ridiculously light on details; it contains gems such as "you can't tell liquidity from trading volumes" -- okay, what should we be looking for, then? There's a chapter with an interivew with Linda Raschke and another on charting written by Steve Palmquist; neither chapter contributes anything at all to the rotation strategies discussed in part 3 of the book. The book concludes with a brief discussion of trading plan by some "doctor."

So, you'll buy the book only for the 30 or so pages on rotation strategies. Actually, it's one strategy with a few variations. The author shows you backtesting results using index data and then ETF data (the latter covers a much shorter period, usually only from 2002 on). I do like the fact that in at least one of the tests he didn't forget to include transaction cost. The strategies are simple and may work if followed religiously. The author discusses a few ways of building on top of the basic principles. For me, these 30 pages are worth the (Amazon) price of the book, although similar information can be found, for free, on the web.

16 of 19 people found the following review helpful:

5.0 out of 5 stars Highly recommended, May 7, 2007

By	Leo Karl (Grinnell, Iowa) - See all my reviews (REAL NAME)

Like many books that purport to help investors make money in the financial markets, these Amazon reader reviews of Vomund's book run the gamut from fives to ones. That kind of opinion extreme can easily leave a potential reader without persuasive guidance in determining the suitability of the book for his particular needs. Yet, it is that very divergence of opinion which should tell you why the book is especially worth reading. I would argue that those, including myself, who praise the book, may very well have tried and failed to implement one or more of the many complex investment techniques which periodically rise and fall in popularity, and through personal experience they have learned to respect the simple elegance implicit in Vomund's readily implementable technique involving holding the winning securities and purging the losers. Due to the very newness of ETFs as investment vehicles, there has been less understanding of just where ETFs - until recently, used primarily by institutions -- might serve the individual investor. His research merging the new ETFs with the "hold the best, purge the worst" trading method is a unique, interesting effort backed-up with both back testing and actual trading.

The negative reviews appear to miss the thrust of the book entirely, arguing that the book fails to include content that is actually not relevant to the thesis that Vomund is presenting, while they offer no refutation, or apparent understanding, of the ideas that Vomund does indeed describe. It behooves us first to understand Vomund's technique for trading the new ETF vehicles, if only to gain the standing required even to think about negative criticism.

Vomund writes simply, and well. Although he is both intellectually and experientially capable of perking-up the interest of those who might prefer accompanying treatises on esoteric Fibonacci series trading methodologies, he writes primarily for those of us who have become wearier and poorer trying to invest without a cohesive system of our own. Or worse, we have watched helplessly as commissions we pay our brokers consistently exceed the returns that our brokers produce for us.

I plan to employ his methods, confident, based on my own experience and analysis, that I will receive consistently decent returns. Returns definitely equal to, and probably better than, any of the other investment modes available to someone like me with scant time available for investment following.

A final philosophic observation:

The greatest problem with simplicity is that it is simple. A simple explanation of complex phenomena is incredibly difficult to achieve. When we come on something of admirable simplicity, we sometimes remark: "...That's so simple that even I could have thought that up!" ...........The problem is .... We didn't.