Diversify with Exchange-Traded Funds

WUPW - If you think now is the time get in or back in the stock market, it's important to keep a fundamental rule in mind - make sure you're diversified both in and outside of the stock market.

One way to diversify within the market is with Exchange-Traded Funds.

Most of you have heard of mutual funds, a collection of stocks in one fund.

Well, Exchange-Traded Funds, or ETFs as they're more commonly called, are similiar, but they have a unique advantage over mutual funds.

With a mutual fund, if something were to happen and you needed to get out of it, you're only guaranteed to get the price it's selling for at the end of the day.

The problem is that could mean a huge loss for you.

With an ETF, you get the advantage of a collection of stocks, but it also trades like a stock.

Once you decide to get out, if it's during market hours, you can put your order in right away, or protect your order, like a stock, by specifying a price to sell at or above.