ETF options trading uses options on Exchange Traded Funds (ETFs) which are similar to index mutual funds, except that they are listed on an exchange and can be traded intraday just like stocks. Investors can buy or sell shares in the collective performance of an entire stock or bond portfolio as a single security. Exchange traded funds add the flexibility, ease and liquidity of stock trading to the benefits of traditional index fund investing.
There are now almost 1,000 ETFs available on broad stock market, stock industry sector, international stock, commodities, US Treasury bond, and corporate bond indexes, providing a wide array of opportunities for investors and traders. ETFs provide a simple and effective way to invest in equity, commodity, and bond markets worldwide. ETF options trading is available on hundreds of these exchange traded funds. While investors can establish long-term investments in the market performance of ETFs, short-term investors and traders can use ETF options trading to take advantage of these financial market opportunities with lower costs and reduced risk.
To learn more about which ETFs you should be investing in today, read the Insightful Investing Newsletter every month. You can also see how well our ETF Investing Portfolios have performed over the past several years. The 100 Best ETFs to consider for your portfolio are found in our list of exchange traded funds. When you are ready to learn about ETF options trading, follow our Options Investing Blog where you can learn about how we use many options trading strategies.