By: muncie birder

muncie birder — Mon, 02 Jul 2012 09:53:25 +0000

An acquisition will have a small effect on an EFT, about 0.3% maximum. Each holding accounts for no more than about 5% maximum of each EFT and that holding would be a very large company that no one could afford to acquire.

What do you consider a windfall profit? 40%? yes, possibly but not likely.

What do you consider a large profit? If you are talking $ 200 investment in each fund, I imagine you might consider $ 50 a large profit. So if you invest $ 1000 you should be able to have a real good chance of making $ 50 on your investment.

There is no golden rule on how long to hold a fund. One might hold one until the market becomes exceedingly over bought, such as in 1999. Then the risk of continuing to hold it becomes too great, but taxes are certainly a concern unless it is held in a Roth IRA account.

Not all EFTs pay dividends. A specific example of one that does not is GLD.

Your guess is as good as mine as to making adjustments. Frankly, I would not because of the transactions costs of doing so.

By: Frank Castle

Frank Castle — Mon, 02 Jul 2012 09:27:32 +0000

1) Yes.
2) Yes.
3) At least $ 25,000.00 USD
4) Until you die.
5) No.

You won’t make any money trading lots of $ 200.00 the comissions will kill your profits.

Comments on: Q&A: Does acquisitions of companies, listed in an ETF fund increase it’s price?

By: muncie birder

By: Frank Castle