ETFs vs futures vs stocks

[OverTheTop]

Hello everyone,

I wanted to hear from traders who trade or have traded futures, stocks and ETFs and prefer the latter.

why do you prefer ETFs over futures, for example? it looks like there are more disadvantages than advantages.

1. futures and stocks are more liquid than ETFs
2. you pay less taxes on futures gains
3. futures offer higher leverage
4. futures and stocks spreads are tighter than ETFs

so why do you prefer ETFs over futures and stocks?

[Soverus Khan]

I don't know if "preference" is the right term. Use what is needed at the time.

For example, if a setup appears on the S&P whether news driven or technical, the ultra ETFs can be quickly used to exploit the situation. This assumes you have the buying power to exploit the move (1000-5000) shares.

SSO
SDS

[kerahc]

Originally Posted by Soverus Khan

I don't know if "preference" is the right term. Use what is needed at the time.

For example, if a setup appears on the S&P whether news driven or technical, the ultra ETFs can be quickly used to exploit the situation. This assumes you have the buying power to exploit the move (1000-5000) shares.

SSO
SDS

personally if you want leverage and liquid jump in QQQQ options....

[Leth]

Here are a few ETFs with above average liquidity (above 1 million).....

...You can play options on ETFs just like stocks...option contracts are much more affordable than general futures contracts...

DIA DIAMONDS Trust State Street Global Advisors $125.84 0.18% 14,637,200 2.24%
DXD ProShares Ultra Short Dow 30 ProShares Advisors, LLC $55.03 0.95% 2,592,100 4.53%
GDX Market Vectors TR Gold Miners Van Eck $54.38 0.55% 1,614,100 1.37%
IAI iShares DJ US Broker-Dealers Idx Barclay's Global Investors $43.99 0.48% 1,168,900 0.87%
IBB iShares Nasdaq Biotechnology Index Fund Barclay's Global Investors $77.21 0.48% 1,406,400 0.46%
ICF iShares Cohen & Steers Realty Majors Index Fund Barclay's Global Investors $77.08 0.35% 1,109,700 5.79%
IJR iShares S&P Small Cap 600 Index Fund Barclay's Global Investors $61.69 0.20% 1,615,700 1.24%
IVV iShares S&P 500 Index Fund Barclay's Global Investors $137.19 0.09% 2,405,100 2.33%
IWD iShares Russell 1000 Value Index Fund Barclay's Global Investors $75.970.20% 2,961,100 2.58%
IWF iShares Russell 1000 Growth Index Fund Barclay's Global Investors $56.43 0.20% 2,726,900 1.00%
IWM iShares Russell 2000 Index Fund Barclay's Global Investors $70.32 0.20% 93,834,600 1.52%
IWN iShares Russell 2000 Value Index Fund Barclay's Global Investors $67.110.25% 2,464,100 2.66%
IWO iShares Russell 2000 Growth Index Fund Barclay's Global Investors $75.47 0.25% 4,328,700 0.57%
IYR iShares Dow Jones U.S. Real Estate Index Fund Barclay's Global Investors $64.13 0.48% 6,411,300 4.87%
KBE KBW Bank ETF State Street Global Advisors $42.32 0.35% 1,059,400 4.87%
KRE KBW Regional Banking ETF State Street Global Advisors $35.22 0.35% 1,452,800 10.93%
MDY SPDR Mid Cap 400 PDR Services, LLC $147.63 0.25% 5,023,700 1.21%
OEF iShares S&P 100 Index Fund Barclay's Global Investors $63.36 0.20% 1,568,600 2.13%
OIH HOLDRS Oil Services Trust Merrill Lynch $182.61 9,004,000
QID ProShares Ultra Short QQQ ProShares Advisors, LLC $50.97 0.95% 23,271,200 3.70%
QLD ProShares Ultra QQQ ProShares Advisors, LLC $70.85 0.95% 2,996,100 0.10%
QQQQ PowerShares QQQ PowerShares Capital Management, LLC $44.12 0.20% 143,045,800 0.48%
RTH HOLDRS Retail Merrill Lynch $92.03 4,944,600
SDS ProShares Ultra Short S&P 500 ProShares Advisors, LLC $61.54 0.95% 11,319,500 3.71%
SKF ProShares Ultra Short Financials ProShares Advisors, LLC $110.75 0.95% 1,057,600 0%
SMH HOLDRS Semiconductor Merrill Lynch $29.45 11,767,800
SPY SPDR S&P 500 ETF State Street Global Advisors $136.87 0.10% 174,680,600 2.27%
SSO ProShares Ultra S&P 500 ProShares Advisors, LLC $71.09 0.95% 1,508,400 2.07%
TWM ProShares Ultra Short Russell 2000 ProShares Advisors, LLC $81.15 0.95% 3,005,400 0.54%
USO United States Oil Fund Victoria Bay Asset Management, LLC $81.48 0.50% 3,099,900
XHB SPDR S&P Homebuilders ETF State Street Global Advisors $21.57 0.35% 4,359,000 1.47%
XLB Materials Select Sector SPDR Fund State Street Global Advisors $42.23 0.24% 7,592,700 3.72%
XLE Energy Select Sector SPDR Fund State Street Global Advisors $78.66 0.24% 22,390,900 1.01%
XLF Financial Select Sector SPDR Fund State Street Global Advisors $26.70 0.24% 54,267,500 3.92%
XLI Industrial Select Sector SPDR Fund State Street Global Advisors $37.27 0.24% 4,568,700 2.00%
XLK Technology Select Sector SPDR Fund State Street Global Advisors $22.61 0.24% 2,869,100 0.54%
XLP Consumer Staples Select Sector SPDR Fund State Street Global Advisors $27.65 0.24% 2,395,000 2.13%
XLU Utilities Select Sector SPDR Fund State Street Global Advisors $38.75 0.24% 6,400,400 3.38%
XLV Health Care Select Sector SPDR Fund State Street Global Advisors $33.26 0.24% 2,266,200 1.57%
XLY Consumer Discretionary Select Sector SPDR Fund State Street Global Advisors $32.12 0.24% 3,253,000 2.92%
XRT SPDR S&P Retail ETF State Street Global Advisors $33.12 0.35% 2,071,100 0.88%
TLT iShares Lehman 20+Yr Treasury Bond Fund Barclay's Global Investors $92.81 0.15% 1,847,200 4.25%
EEM iShares MSCI Emerging Markets Index Fund Barclay's Global Investors $145.40 0.75% 14,528,400 1.34%
EFA iShares MSCI EAFE Index Fund Barclay's Global Investors $73.44 0.35% 8,248,900 2.72%
EWA iShares MSCI Australia Index Fund Barclay's Global Investors $27.81 0.54% 1,863,500 4.59%
EWG iShares MSCI Germany Index Fund Barclay's Global Investors $31.84 0.54% 1,316,600 1.63%
EWH iShares MSCI Hong Kong Index Fund Barclay's Global Investors $19.05 0.54% 5,243,600 1.99%
EWJ iShares MSCI Japan Index Fund Barclay's Global Investors $12.68 0.54% 20,428,300 1.09%
EWM iShares MSCI Malaysia Index Fund Barclay's Global Investors $12.79 0.54% 3,517,400 3.17%
EWS iShares MSCI Singapore Index Fund Barclay's Global Investors $12.58 0.54% 4,074,600 4.05%
EWT iShares MSCI Taiwan Index Fund Barclay's Global Investors $15.68 0.70% 7,550,600 2.49%
EWW iShares MSCI Mexico Index Fund Barclay's Global Investors $58.46 0.54% 3,637,200 1.79%
EWY iShares MSCI South Korea Index Fund Barclay's Global Investors $59.16 0.70% 2,146,500 0.62%
EWZ iShares MSCI Brazil Index Fund Barclay's Global Investors $88.17 0.70% 11,604,000 0.88%
FXI iShares FTSE/Xinhua China 25 Index Fund Barclay's Global Investors $150.49 0.74% 4,209,600 1.39%
GLD streetTRACKS Gold Shares ETF World Gold Trust Services, LLC $95.99 0.40% 6,394,800
OIH HOLDRS Oil Services Trust Merrill Lynch $182.61 9,004,000
RTH HOLDRS Retail Merrill Lynch $92.03 4,944,600
SMH HOLDRS Semiconductor Merrill Lynch $29.45 11,767,800

[Soverus Khan]

Originally Posted by kerahc

personally if you want leverage and liquid jump in QQQQ options....

As I said, use what is needed at the time.

[kerahc]

Originally Posted by Soverus Khan

As I said, use what is needed at the time.

Very good statement, I think it's the indifference in which strategy is used that gives a trader the best chance at success....

[ChaosTheory]

who said traders prefer ETFs over futures or stocks? whether you prefer ETFs over other trading vehicles should be dictated by market conditions at the time and trading strategy, to a certain extent.