Trend Switching With ETFs by Moshé Prince
Trends And Seesaws
Given the volatility in the markets, you need to know when to get into a trade and when to get out. The use of ETFs has made this easier. Find out how.
Trend switching and trigger switching are the foundation of a successful trading/investing strategy in exchange traded funds (ETFs). I know there is a line of thinking out there that says buy & hold is the way to go, but in my opinion, the days of buy & hold are over. After decades of trial and error, I have found that buy & hold has had merely a modicum of success.
ETFS TO THE RESCUE
Do you have the stomach to watch an unnecessary loss of more than 30% to 40% in your portfolio at any given time and to wait out a recovery? Luckily, you don’t have to because there are tools available that you can use to get out of trades at the right time. As the market changes with the times — or changes the times — you must be flexible to know when an old process no longer works. These days, following trends without being aware that the market may go in the opposite direction seems to be the tried and true method. But some would argue that the buy & hold approach is the only way to invest.