The Five Best Free ETF Tools Online
Everyone likes to get something for free. Unfortunately, many things that can be had at no financial cost often don't have any value. Fortunately, that is not the case when it comes to tools that can help traders and investors make more informed (and profitable) decisions regarding exchange-traded products.
In fact, an often underrated benefit tied to the rapid expansion of ETFs and ETNs is how many free and useful tools there are that investors can use. Beyond enhanced education, investors can use the free tools featured here as parts of broader strategies to increase profits and steer clear of dangerous products.
Five tools were selected for this list, although it should be noted that there are others out there worthy of consideration (an addition to this list is forthcoming later this year). In no particular order:
Direxon's Educate Me Feature Naysayers might say "Of course Direxion is going to say a bunch of nice things about leveraged ETFs. They want people to invest in those funds."
True, Direxion is the second-largest issuer of leveraged and inverse ETFs behind ProShares, so it does behoove both companies to paint constantly controversial leveraged ETFs in a more positive light.
However, what is better for issuers of these funds is to educate investors about the risks involved before those investors plunk their cash down. An educated trader of leveraged ETFs is more likely to keep using the products over someone who gets burned once or twice and swears off these funds forever.
Beyond access to a free brochure on how leveraged ETFs work and a piece on how volatility impacts these products, Direxion features Direxion University, which anyone can access to delve deeper into the curious world of leveraged funds.
ETFScreen.com There are ETF screens all over the place and some of the free ones are actually decent. That said, the standard by which advanced free ETF screens should be measured is the one found at ETFScreen.com. Not only can investors save and share their screens, but they can access screens published by other members.
One caveat: Some of the tools featured on ETFScreen's screening function are advanced, so it might be fair to say this is not the weapon of choice for those new to the financial markets. On the other hand, intermediate and advanced traders will benefit from and enjoy the tools found here.
ETFReplay.com A fine site, but there is one tool here that really stands out: The ETF Correlation tool. Rising correlations are a popular topic of conversation these days and that conversation usually involves ETFs.
The ETFReplay correlation tool allows investors to compare 10-, 20-, 30-, 60- and 120-day correlations for just about any ETF pair one can think of. For example, with just a couple of keystrokes, it was easy to discover the U.S. Oil Fund (NYSE: USO) and the Teucrium Corn Fund (NYSE: CORN) have only a slight correlation with each other.
ETFdb Country Exposure Tool Some investors blindly buy global ETFs without knowing exactly what countries those funds offer exposure to. Others become agitated when they discover ETFs such as the iShares MSCI Emerging Markets Index Fund (NYSE: EEM) and the Vanguard MSCI Emerging Markets ETF (NYSE: VWO) are heavy on South Korea and Taiwan, two countries that, arguably, should not be considered emerging markets any longer.
Both scenarios can be avoided with the ETFdb country exposure tool. Not only does this tool lead investors to useful information, it is quick and easy to use. For example, it takes less than one second to learn there are nearly 120 ETFs offering exposure to Brazil. Two more mouse clicks unveil the list of those funds.
ETFdb Stock Exposure Tool If more investors, professional and retail alike, used this tool then more folks would realize the Technology Select Sector SPDR (NYSE: XLK) and the PowerShares QQQ (NASDAQ: QQQ) are not the ETFs with the largest allocations to Apple (NASDAQ: AAPL).
The stock exposure tool does exactly what its name implies. That is guide investors to the those ETFs that feature large allocations to the stock entered in the search field. One point to note about this tool: It only brings up those that feature the searched stock among the top-10 holdings. For example, the stock exposure tool indicates PepsiCo (NYSE: PEP) is a top-10 holding in about 25 ETFs, but the stock is found in many more ETFs than that.
As ETFdb notes, the tool only identifies stocks. It does not work with bonds, commodities or asset classes. Still, the functionality and ease of use of this tool makes it a worthy addition to any ETF research arsenal.
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