Interested in cheap ETFs, need beginner advice

I wouldn't start trading. I'd start investing. It's really commendable that you're interesting while in college, but trading is a different animal. A lot of guys say they are traders. All you need to do is ask them which brokerage they use. If it's E-trade, or Ameritrade, they aren't serious traders. You need a broker like IB, where you can route trades to selected market centers, place hidden orders, and access dark liquidity pools.

If your heart is set on trading, find an account to practice on with fake money. Even then, you aren't even beginning to touch on how to properly route and hide orders.

What I would do if I was you is buy a couple of dividend paying stocks, and let this sit until we have a real market correction. I'd buy some utilities right now. Then to further your education in "trading", if this is what you want to do, you can show discipline and restraint, and take no action until we've had a real correction. Discipline is an important quality in trading, and you might have to wait several years before you have real opportunity. Then you could sell your dividend payers and buy the Wilshire 5000 index as close to the bottom as you can come. And by then you should have some more funds, and can conservatively trade around the broader market index.

Or go ahead and start to "trade", and guys like me will rip you to pieces. Because I trade, and I still get ripped to pieces, I just win slightly more than I lose. And I've done it a long, long time.

You are better off to use ETFs as a buy and hold because you don't have enough to meet the mini for a mutual fund.

If the problem keeping you from Vanguard is the costly share costs, check out Sharebuilder as a broker.

You can buy fractional shares so you can always buy whatever stock you want even if it is Google.


Just don't set up automatic trades for TOO little an amount, or the cost basis will eat you alive.