How To Use ETFs To Create Synthetic Markets: 2 Plays
By Steven Reiman:With this article, we just want to point out that there are more options than trading the stock market directly. In general, investors are either long (bullish) or short (bearish) in the S&P 500 or other indexes. More precisely, private investors either buy stocks or they keep their money in cash or bonds. We just want to introduce the "new markets" we can build artificially. To make it clear, there are a number of official markets, like buying stocks using the USD of my account, or buying commodities, like gold, through futures. However, there is not a place where an investor could directly bet that gold is going to outperform oil, or that Apple (AAPL) is a better company than the Nasdaq as whole (and get the difference positive or negative). Through two examples, we will show two possible real trades using ETFs. These trades are just examples, not recommendationsComplete Story »
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