Now there are numerous exchange traded funds, index alternatives and index futures that permit trading the Nasdaq 100 index. The advantage of trading indexes is that there is no need for any complex essential analysis, which is, already has, actually been done by the company that handles the index (Nasdaq OMX in our case). A trader might focus only on technical analysis of the Nasdaq 100 index and use the results of the analysis to trade securities that reflects the index trend. The QQQ stock continues to be to be among the most popular from this family. However, big interest of the investors is also provided QLD and QID leveraged exchange traded funds (double and double inverse ETFs). NQ index emini futures are also having ended up being quite popular lately.
An Index Personality for Everyone. The four significant indexes that are traded (S&P, Dow, Nasdaq and Russell) each have various characters, while sharing the general attributes and trading designs of indexes. The S&P is a bit slow and ponderous, with great fills and minimum slippage. The Russell is the other end of the spectrum moving quickly at the drop of a hat. Both the Dow and Nasdaq fall someplace in between.
The Whole Nasdaq Enchilada
From one side a trader or investor can fall under the wrong presumption that when you trade QQQ you need to examine QQQ cost and volume trends. QQQ is developed to reflect 1/40 off the rate of the Nasdaq 100 index, and even if the tracking stock trend moves a little from the trend of the index, by the end of the day the trend of the stock is adjusted to reflect this ratio. This is just an example, yet, all tracking commodities track the benchmark indexes. Moreover, it is logical to examine index and not a tracking stock.