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Merrill Lynch Semiconductors HOLDRS ETF Trading

Semiconductor HOLDRS ETF Trading Defined and Explained

The Semiconductor HOLDRS (SMH) is an exchange-traded fund that tracks the performance of a number of major semiconductor producers and suppliers. The fund's top 10 holdings account for roughly 85% of its value, with Intel encompassing nearly a quarter of it’s value.

Semiconductor HOLDRS ETF Trading Prices/Rates

The ETF’s daily prices are available in most major newspapers and online. The Semiconductor HOLDRS ETF is a solid performer that allows for excellent tracking and prediction with the right tools. However, because they aren't highly diversified, HOLDRs tend to be much more volatile than the average ETF.

Semiconductor HOLDRS ETF Trading Software

Knowing what is going to happen in the market is critical to profitable ETF trading. VantagePoint software forecasts the Semiconductor HOLDRS ETF high and low for the next day with a very high accuracy, so you'll know where to put your stops and whether to tighten up on them or get out of the trade immediately.

Using forecasts of market trend direction in conjunction with predicted highs and lows greatly increases the potential for successful Semiconductor HOLDRS ETF trades. VantagePoint even allows you to visualize forecasts and indicators graphically on your computer for ease of use.

Semiconductor HOLDRS ETF Trading News

When trading the Semiconductor HOLDRS ETF, news items in the sector affecting the primary holdings can immediately affect the ETF. Traders must be aware of the general market and maintain vigilance over the semiconductor market.

Semiconductor HOLDRS ETF Trading Information

SMH is highly correlated with the NASDAQ Composite Index and the Nasdaq-100, with correlation coefficients of greater than 90% relative to these two indices.

ETF Traders should be aware that this is a HOLDR managed by brokerage house Merrill Lynch. You cannot buy or sell less than 100 shares of a HOLDR in any transaction. However, they are still exempt from the uptick rule that could keep you from profitably shorting this ETF.

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