3M Profit (MMM)Down 17%; Increases 2009 Revenue Forecast

Demand for facemasks for protection against the H1N1 flu virus helped boost 3M’s (MMM - Quote) second-quarter results, but earnings fell by 17% compared to a year ago because of other demand for other products.

The Minnesota-based manufacturer of Post-Its and Scotch Tape and hundreds of other products said Thursday that second-quarter earnings excluding one-time items fell to $1.20 a share from $1.39 a share a year ago. Revenue fell 15% to $5.7 billion.

The results solidly beat the 94-cent profit expected by analysts, according to Thomson Reuters, sending shares up nearly 5% in New York Stock Exchange-based trading.

"We drove strong results in the second quarter, exceeding our own expectations for profits, sales and free cash flow," said 3M Chairman and CEO George W. Buckley in a statement. "Operating discipline was key to the quarter.”

3M raised its full-year earnings forecast to $4.10 to $4.30 a share, compared with its view in April for earnings of $3.90 to $4.30 a share.

Part of 3M’s operating results was driven by broad cost cutting measures across the entire company. In the first six months of the year, the company laid off or provided for early retirement for 2,800 employees.

Buckley said that he remains cautious about the forecast for the economy, and that cost cutting could continue throughout the firm.

“While the exact shape and timing of the economic recovery is unknown, we will move ahead efficiently and energetically so that 3M emerges from the downturn an even stronger company," he said in a statement.

Another one-time component to 3M’s results was the sale of masks related to the outbreak of swine flu earlier this year. Buckley said that orders for 3M’s facemasks were on backorder as a result of the outbreak, which helped offset what were double-digit declines in the company’s operations the company’s other divisions.

Disclosure I am long MMM in my consumer goods/services folio.

Burlington Northern (BNI) Approves $0.40 Qtr. Dividend

Burlington Northern Santa Fe Corporation (BNI - Quote) today declared a quarterly dividend of $0.40 per share on outstanding common stock. The dividend is payable on October 1, 2009, to shareholders of record September 10, 2009.

The ex-dividend date is September 8.

The dividend currently yields 2.03%.

Disclosure I am long BNI shares in my shipping Folio.

Weekly update on 8 folios and recent transactions, Retire on $5.00 per day each day market open

Well not a lot going on with the buy and selling in my 8 folios but here is a breakdown of my recent activity.

Basic materials folio which includes my commodities picks. Currently I am long 17 picks and will be selling one tomorrow. I am long, IPHS,DO,KWR,TYG,EEQ,BP,KMR,NUE,
GNI,DJP,E,BPT,CVX,SLV,GLD, AND GGN. Combined this folio is up 12.24% year to date not including dividends. I will be selling RJI tomorrow, taking a small 5 to 6 % profit.

In my bonds and closed end fund folio, (fixed income) all pay monthly dividends. I am currently long. IID, DPO, IGD, EOS, MAIN, AOD,ESD,JNK,HYG,PCY,PSEC,LQD, and BND. This folio is up 13.54% year to date. No changes this week.

In my financial and reit folio. I am long 15 stocks. This folio is up 10.10% year to date. Top pick AGNC and AFL, my 2 laggers are ESS and CMO. I just repurchased CMO this week after selling it last week for 34% profit. No other changes.

My consumer goods and consumer services folio, all but shipping stocks. Currently is long 11 stocks. MMM and CALM leaders, with SYY a lagger. This folio is up Year to date 10.94% no changes for this folio either.

My index etf and emerging markets etf folio. Currently long 11 etfs, with FXI and VWO leading the way. Even my lagger EFA is up 7.76%. This folio is up 13.36% year to date.
No changes at this time.

My industrial goods and healthcare folio. Contains 17 picks with CAT and GSK at the clear winners, ABT and ECOL the laggers. This folio is up 10.70% year to date. Recently Purchased CAH which is already up 7.83% since my initial purchase. No other changes.

My shipping and railroad folio. By far the healthiest and hottest folios of all lately. Currently long 14 stocks with CSX, SFL, leading the way, and the laggers are GMR and DHT. This folio is up currently 17.17% year to date. No recent changes to this folio.

And my last folio is my utilities and tech folio. Currently long 15 stocks, with INTC, TEG as the winners. The laggers are CTL and ADP. This folio is currently up 11.81% year to date. No recent changes to this folio at this time.

So my total portfolio consisting of 8 folios is up 12.53% year to date, which does not include dividends. I have received 2.24% in dividends this year to date. I still dollar cost average every single day the market is open. I have not missed one trading day this year. I add $5.00 a day spread across each folio plus reinvest the dividends back to who paid them. If a stock cuts its dividend I sell it period.

My core is 112 stock, etfs and closed end funds. The cream of the crop according to my eyes, my value and my long term holding period. I plan to hold this dividend paying stocks until further notice As I try to spank the shorts of my 401k provided through my employer with Principal Financial Group.

Now to my 401k my work currently matches 50% of the first 6 percent so that is all i put there i put the rest in my above mentioned Roth ira account at Folioinvesting.com.

Currently up year to date in my 401k, 18.81% before fees, god only knows how much they will be. Received $7.82 in dividends year to date, versus $40.29 through june in my roth ira.

In closing I am very excited to be playing the market, living, breathing and smelling the stocks. Dow broke 9000 today I used to watch everyday to see what happened, course i still do but nothing seems to matter now that I have plan and stick to it. My core is built and I am in the accumulate phase of my retirement plan. No matters what happens I have am on this train. I go to the coal mines shovel in hand(aka my work place). Do the best I can and try to add to my folio more money everyday.

Sometime I ponder how this all started with just $ 1.00 a day investing in my favorite stocks, at the start of this year I opened this roth ira and now I am off to the races(LOL). So yes you can retire at just 5.00 a day every day the market is open. Yes I do see some ups and downs in the future. But this is so much better than smoking, drinking, gambling and parting away all my money never having a pot to piss in so to say. Now I can see the light I feel better, look better, am happier and have a pot to piss in now.

Please feel free to comment on this or any of my other stories, I have gathered here on my blog. Only through each other can we prosper together. Thanks for taking the time to read my blog, I only hope I can show the light to one more person out there somewhere.


Disclosure I am long all stock mentioned in this blog as well and many that were not motioned. Please if you do invest do your own research what works for me many not work for all I am not a licensed broker at this time but sure hope to be very soon.

Diamond Offshore Drilling, Inc.(DO) Declares Special Cash Dividend of $1.875 Per Share and $0.125/Share Regular Dividend

Diamond Offshore Drilling, Inc. (DO - Quote) announced today that the Company has declared a special cash dividend of $1.875 per share of common stock and a regular quarterly cash dividend of $0.125 per share of common stock. Both dividends are payable on September 1, 2009 to shareholders of record on August 3, 2009.

The Company has adopted a policy of considering paying special cash dividends, in amounts to be determined, on a quarterly basis. Any determination to declare a special dividend, as well as the amount of any special dividend which may be declared, will be based on the Company's financial position, earnings, earnings outlook, capital spending plans and other relevant factors at that time.

Diamond Offshore provides contract drilling services to the energy industry around the globe and is a leader in deepwater drilling. Additional information on Diamond Offshore Drilling, Inc. and access to the Company’s SEC filings is available on the Internet at www.diamondoffshore.com.

Disclosure I am long DO in my oil n gas folio, currently up 26.12% year to date(not including prior dividends paid).

Lockheed Martin (LMT) 2Q profit down 17 percent

Lockheed Martin Corp. (LMT - Quote) said its second-quarter earnings fell nearly 17 percent, as large pension expenses created by the financial crisis continued to dig into the defense contractor's bottom line.

The results come as Lockheed, which makes fighter jets and other military hardware, and the rest of the defense industry continue to digest the effects of a broad shift in spending priorities at the Pentagon, their biggest customer.

The Bethesda, Md.-based maker of fighter jets earned $734 million, or $1.88 per share. It made $882 million, or $2.15 per share last year. Revenue rose about 2 percent to $11.24 billion.

For Lockheed, that would mean capping production of its F-22s-- which costs $140 million each--at 187 jets. The company has said it accepts that decision, but the Obama administration and Congress are in a fierce battle over attempts by lawmakers to add hundreds of millions more dollars to the budget for additional planes.

The budget could also help Lockheed, as the Pentagon plans to accelerate production of the company's newer F-35 fighter. The military eventually expects to buy 2,450 of the jets, with foreign governments considering purchases of another several hundred.

Bruce Tanner, Lockheed's chief financial officer, said in an interview that the company has not lobbied for more F-22s since Defense Secretary Robert Gates made his budget announcement in April.

"We would love to build more F-22s, but the customer needs to decide whether that is what they want to do or not," Tanner said.

Lockheed has warned that losing the F-22 would lead to thousands of job losses when the production line ends at its Marietta, Ga. plant in 2012 under current plan. Tanner said funding for additional jets could prompt the company to add jobs.

Some of Obama's budget proposals have already been felt. The cancellation of Lockheed's contract to build new helicopters to carry the president and a communications satellite have taken $2.5 billion out of the company's $79 billion backlog of orders, Tanner said.

The company's aerospace unit, which makes the F-22 along with other fighters and cargo planes, had seen its sales dip in recent quarters as it shifts from making the aging F-16 to the F-35. But the division posted a seven percent sales increase in the second quarter, driven by higher results in both the F-35 and the F-16, which Lockheed still sells to foreign governments.

Sales were lower in its business selling services to government agencies, which Tanner said was the result of problems on some programs and protests by competitors that delayed sales on contracts for special forces and at a government nuclear facility. The division's sales were down 6 percent to $3 billion.

Lockheed's space division, which makes satellites and other equipment, saw sales drop 7 percent to $2 billion while its military electronics unit sales dipped 1 percent to $3 billion.

In the second quarter, the pension expense was $115 million. That lowered earnings by $75 million, or 19 cents per share this period while one-time gains from land sales and tax gains a year ago added 19 cents. The company said in January that pension expenses would be higher each quarter this year because of a drop in the retiree fund's value.

The results still beat analyst expectations of $1.81 per share and revenue of $11.14 billion.

Lockheed held to its 2009 earnings outlook of between $7.15 and $7.35 per share on revenue between $44.7 billion and $45.7 billion. Analysts are looking for stronger results of $7.41 per share on $45.36 billion in revenue.

Its shares tumbled $4.67, or 5.7 percent, to $77.44 in morning trading.

Under President Barack Obama's 2010 budget, the military is spending more on weapons to fight insurgencies in places like Iraq and less on weapons designed for conventional wars.

For Lockheed, that would mean capping production of its F-22s-- which costs $140 million each--at 187 jets. The company has said it accepts that decision, but the Obama administration and Congress are in a fierce battle over attempts by lawmakers to add hundreds of millions more dollars to the budget for additional planes.

The budget could also help Lockheed, as the Pentagon plans to accelerate production of the company's newer F-35 fighter. The military eventually expects to buy 2,450 of the jets, with foreign governments considering purchases of another several hundred.

Bruce Tanner, Lockheed's chief financial officer, said in an interview that the company has not lobbied for more F-22s since Defense Secretary Robert Gates made his budget announcement in April.

"We would love to build more F-22s, but the customer needs to decide whether that is what they want to do or not," Tanner said.

Lockheed has warned that losing the F-22 would lead to thousands of job losses when the production line ends at its Marietta, Ga. plant in 2012 under current plan. Tanner said funding for additional jets could prompt the company to add jobs.

Some of Obama's budget proposals have already been felt. The cancellation of Lockheed's contract to build new helicopters to carry the president and a communications satellite have taken $2.5 billion out of the company's $79 billion backlog of orders, Tanner said.

The company's aerospace unit, which makes the F-22 along with other fighters and cargo planes, had seen its sales dip in recent quarters as it shifts from making the aging F-16 to the F-35. But the division posted a seven percent sales increase in the second quarter, driven by higher results in both the F-35 and the F-16, which Lockheed still sells to foreign governments.

Sales were lower in its business selling services to government agencies, which Tanner said was the result of problems on some programs and protests by competitors that delayed sales on contracts for special forces and at a government nuclear facility. The division's sales were down 6 percent to $3 billion.

Lockheed's space division, which makes satellites and other equipment, saw sales drop 7 percent to $2 billion while its military electronics unit sales dipped 1 percent to $3 billion.

Disclosure I am long LMT shares in my industrial goods folio.

Caterpillar Delivers Second-Quarter Profit and Increases 2009 Profit Outlook

Caterpillar Inc. (CAT - Quote) today reported a second-quarter profit of $0.60 per share, down $1.14 per share from the second quarter of 2008. Excluding redundancy costs, profit was $0.72 per share. Redundancy costs related to reducing employment were $85 million before tax or $0.12 per share in the quarter. Sales and revenues of $7.975 billion were down 41 percent from $13.624 billion in the second quarter 2008.

"Our profit this quarter, despite the sharp decline in sales, is a tribute to Team Caterpillar's response to this severe global recession and the continued deployment of our economic trough strategy," said Chairman and Chief Executive Officer Jim Owens. "There is still a great deal of economic uncertainty in the world, but we are seeing signs of stabilization that we hope will set the foundation for an eventual recovery. Credit markets have improved significantly. Fiscal policy and monetary stimulus have been introduced around the world, and we are seeing signs, particularly in China, that they are beginning to work. In addition, we've seen many key commodity prices increase from their lows in the first quarter, and they are holding in a range that is usually positive for investment," said Owens.

"With our dedicated employees, strong dealer network and supply base, great lineup of products and the increasing impact of integrated service businesses, I am more confident than ever that we will strengthen our industry leadership as we work through this recession," Owens added.

The second-quarter profit of $371 million was down $735 million from $1.106 billion in the second quarter of 2008. The decline was largely a result of lower sales volume and $85 million of redundancy costs. These negative impacts were partially offset by lower Selling, General and Administrative (SG&A) and Research and Development (R&D) expenses, favorable price realization, LIFO inventory decrement benefits and a lower tax rate.

In addition to profit, Caterpillar is highly focused on delivering positive cash flow in 2009 and is committed to its $3 billion inventory reduction goal for the year. Utilizing the Caterpillar Production System (CPS) with 6 Sigma, the company reduced inventory in the second quarter by more than $800 million, and through the first half of the year inventory has declined by more than $1.6 billion.

"In addition to our ability to generate solid profits in this economic climate, I'm pleased with our work to generate positive cash flow and maintain considerable financial strength during this challenging period," Owens said.

Outlook

The company is updating its outlook for 2009 by tightening the sales and revenues range and improving profit expectations. For sales and revenues, the range has been tightened to $32 billion to $36 billion. The 2009 profit outlook is a range of $0.40 to $1.50 per share including redundancy costs of about $0.75 per share. Excluding redundancy costs, profit is forecast to be between $1.15 and $2.25 per share.

"Team Caterpillar is now halfway through one of the most challenging years in the company's history," Owens said. "Our 2009 sales have been hurt by weak end-user demand and significant reductions in dealer inventory. In fact, dealers have reduced their machine inventories by about $1.5 billion through the first half of the year and could reach close to $3 billion by year-end. As tough as this year has been, the improved profit outlook is a tangible sign of what happens when the entire team is pulling in the same direction and deploying the trough strategy we put in place over the past four years. We are very pleased with the way our people have stepped up and responded to this extraordinary period of economic turmoil," Owens said.

For more than 80 years, Caterpillar Inc. has been making progress possible and driving positive and sustainable change on every continent. With 2008 sales and revenues of $51.324 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services. More information is available at: www.cat.com.

Disclosure I am long CAT shares in my industrial goods folio.

The J. M. Smucker Company (SJM) Declares Dividend of $0.35

The board of directors of The J. M. Smucker Company (SJM - Quote) declared a $0.35 per share dividend on the common shares of the Company to be paid on Tuesday, September 1, 2009, to shareholders of record at the close of business on Friday, August 14, 2009.

The Company will conduct its first quarter fiscal 2010 earnings conference call and webcast on Friday, August 21, 2009, at 8:30 a.m. Eastern Time. Earnings will be released on the morning of the call. The live webcast can be accessed from the Company's website at www.smuckers.com. The webcast replay, as well as a replay in downloadable MP3 format, will be available following the call. The audio replay can be accessed by dialing 888-203-1112 or 719-457-0820 and entering pass code 6204951. The replay will be available until Friday, August 28, 2009.

Disclosure I am long SJM in my consumer goods Folio.

Signs That the ETF Industry Continues to Shift

Since the inception of the first U.S.-listed exchange traded fund (ETF) in 1993, the industry has blossomed.

According to the National Stock Exchange, at the end of May 2009, there were 829 ETFs and ETNs listed in the United States offered by 18 different providers on three stock exchanges, comprising total assets of $594 billion. Additionally, there were 137 other exchange traded products (ETP) with assets of $60.8 billion from 19 providers on two exchanges.

According to Barclays‘ April 2009 snapshot of the ETF industry, the average total expense ratio for equity ETFs in the U.S. is 0.32% vs. 0.78% for the average equity index tracking fund and 1.41% for the average active equity fund, further enforcing the low-cost characteristic of ETFs. When analyzing sectors, year-to-date, materials have performed the best returning 16.5%, followed by consumer staples which are up 11.9% year-to-date.

Of all the ETF providers, iShares is the largest with offerings of 177 different ETFs, State Street Global Advisors is second with 85 different ETFs. Of all ETFs, the SPDR S&P 500 (SPY) is by far the most actively traded with the largest amount of assets under management at nearly $60.7 billion. The SPY has had the largest change in assets under management as well, losing nearly $33.2 billion year-to-date.

June 2009 numbers should be released soon – stay tuned and we’ll write about it here.

Disclosure I am long many ETFS and they are a important part of my portfolio.

Roth IRAs are tax-free, but you must follow the rules

Here is a question i got e-mailed and will answer a very good solid point and excellent question.

Q: What are the tax implications of transferring the assets held in an taxable investment account with a broker to a Roth IRA?

A: With the stock market's returns being, well, shall we say, subpar, some investors are paying closer attention to taxes.

And paying attention to taxes, especially now that the stock market isn't an ATM, is smart. Given the size of capital gains taxes, especially if you sell a stock you've owned less than a year, Uncle Sam can end up taking a big chunk of your returns.

The Roth IRA is a great idea for people preparing for retirement. The Roth is structured so that you contribute money that's already been taxed. You can invest up to $5000 a year in a Roth, or $6,000 if you're 50 years old or older, if you meet a number of criteria. You can get the full details on annual contribution limits here.

Here's the catch for you, though. You need to contribute cash, not stock. That means if you have a stock in a taxable account that you want to move to a Roth IRA, you'll need to sell the stock in your taxable account, and you may owe capital gains taxes on the sale.

Disclosure I have a roth ira account(through folioinvesting.com) and love it!

Its over the 401k is DEAD, FAILED, Admit It's Over

Why don't we just admit that the 401(k) is a failure and get on to designing something better?

I say this as the writer of an admiring book about the ubiquitous saving plan (Take Charge of Your Future, Warner Books, 2003), and I still think that 401(k)s are fine as a supplement to other plans. But that's not what they are any more. They have become, by default, the only national retirement savings plan. That raises the bar considerably, and 401(k)s just can't clear it.

Here's what I'm not saying. I'm not saying that the main problem is that 401(k)s require ordinary people to manage their investments wisely and only we "sophisticated" investors who read Huffington Post can do that. (i have more faith in the average Joe's ability look out for himself than that--and less faith in allegedly sophisticated investors.) I am saying that even if every 401(k) participant were Warren Buffett, the plan still falls short of what you ought to expect from the nation's main retirement savings vehicle.

I am not saying that we ought to go back to old fashioned pensions, for good reason, or that you should stop funding your 401(k). You still have to save for retirement and the 401(k), flawed as it is, is the best way we've got to do that. (Especially the Roth 401(k) plan.) I am saying that we should do better. We are asking the 401(k) to play a role for which it was never intended, and we should reshape the plan to fit that role, or get a new plan. Here's what's wrong with the 401(k):

It randomly creates winners and losers. Citizens who take part in a national retirement savings plan ought to know what it takes to succeed. It matters less what the rules are than that they're fair and consistent. If you save more in the plan, you retire with more income. That would be a fine rule. If you earned more in your career, you get more retirement income. That works too. (It had better; it's the Social Security promise.)

But neither necessarily holds true in a 401(k). You could earn the same money, save the same amount, invest as wisely as an identical colleague and still wind up eating the Denny's special while your doppelganger vacations in Greece. It all depends on when in your working life the inevitable market downturn falls. If early, you'll build your nest egg by buying cheap assets and retire rich. If late, you'll find your life savings decimated when it's too late to rebuild. That's a problem. The nation's main retirement funding plan should not be a conduit for administering random acts of fortune. It should aim to alleviate randomness.

The plan leaves people poor Left to their own devices, most employees don't put enough into their 401(k)s to make a dent in their retirement needs. And even if they start out putting enough money in, when times get tough, they stop. Worse still, employers have begun to do the same. According to surveys, about a quarter of employers have stopped, or plan to stop, matching their employees' 401(k) contributions. This is happening at the worst possible time, of course: when stock prices are 40% cheaper than they were 18 months ago.

The plan exposes everyone to the risk that they'll live too long Because you don't know when you'll die, you have to save as if you were Methuselah, just to be safe. The usual financial planner's target is age 95. If you saved the fortune you need to cover yourself to that age and don't make it that far-and most people won't-tough luck. If you do live that long and you didn't save enough-and again, most don't-even tougher luck. The shame of this is, longevity risk can be insured away by averaging out the risk over an entire population. Every annuity does this. Why not the national retirement savings plan?

Congress has been talking extensively about 401(k) reform. At the moment, a bill called the 401(k) Fair Disclosure and Pension Security Act is moving through Congress. But it does nothing more than tinker at the edges of a looming disaster, acting as if lowering fees on 401(k)s by a few fractions of a percentage point will solve the massive underfunding of a whole generation's old age. Forget it. It won't. It's time to stop pretending that the 401(k) can get us where we need to go.

Disclosure I am long one 401k through my work using Principal Financial group.

Time to COnsider SHipping ETF's, Sea is my choice

When countries around the globe start resuming business as usual, shipping will be a given necessity and exchange traded funds (ETFs) are one way to gain access to this sector and satiate your investment needs.

The Claymore/Delta Global Shipping (SEA) reflects the Delta Global Shipping Index, which measures the performance of maritime shipping industry firms in global developed markets, writes Don Dion for TheStreet. The ETF’s portfolio has dry bulk goods and the leasing and/or operating of tanker ships, container ships, specialty chemical ships and liquefied gas or dry bulk goods transport ships.

SEA has 30 holdings with an expense ratio of 0.65%. The fund has a 58.7% allocation in industrials and 41.3% allocation in energy. The components within the fund are based on market capitalization and liquidity.

Investors are coming back into shipping, realizing that countries such as China are demanding materials en masse. More recently, the shipping industry is being driven by steel demand and higher demand from China and emerging markets will likely raise rates on dry bulk shipping.

When talking about the shipping industry, the most important ratio is “bottoms,” or number of ships, to demand for transported goods. If there are more products than bottoms then the rates are high; if there are more bottoms than cargo, then rates are low.

* Claymore/Delta Global Shipping (SEA): up 17% year-to-date

Disclosure I am long SEA in my shipping folio.

Tips for trading ETFs

The more an ETF is traded, the more liquid it becomes, making it even more attractive relative to its less-liquid competitors. Based on conversations with people at various ETF providers, the firm learned that it takes roughly $100 million in assets for a company to justify the expense of offering an ETF. Investors should avoid the risk of investing capital in a product that might be liquidated in the future by evaluating the level of assets in a strategy before committing money to an ETF.

Another indicator of an ETF's liquidity is the bid-ask spread. The bid-ask spread is the difference between the highest price a buyer is willing to pay for an asset and the lowest price at which a seller is willing to sell that same asset. As liquidity increases for a particular product, the spread will narrow, thereby limiting trading costs. Low spreads are good because they reflect a more efficient market for an asset.

However, spreads vary by asset class, among others things. For example, ETFs that track the S&P 500 should have very low spreads because the underlying securities in the S&P 500 are very liquid and easy to access. Some foreign securities, particularly those in emerging markets, may be less liquid and require a wider spread. ETFs that track bonds, particularly less-liquid, high-yield bonds, may trade at wider spreads simply because bonds do not trade on an exchange and therefore are not priced as efficiently as stocks.

Investors should aim to limit trading costs by avoiding illiquid ETFs with wide bid-ask spreads. There is no absolute level of spread we can point to as a threshold for investing in a product or not. However, investors should compare the bid-ask spread of the product they are interested in to other similar products.

Investors also should evaluate whether or not an ETF has been trading at a significant premium or discount to NAV. More ETFs than ever have traded periodically at substantial premiums and discounts in the past few quarters as the capital markets have been stressed. Fixed-income ETFs especially have seen some large premiums and discounts.

There are a few guidelines investors should be aware of regarding the timing of trades. The first general rule is to not trade ETFs at the very beginning or end of the trading day. Spreads tend to be wider at these times than at other times during the trading day, because there isn't as much information priced in during these times and because some of the underlying securities in the portfolio might not be trading.

The second general rule is to try to trade an ETF when the markets for the underlying stocks are open. This pertains mainly to international ETFs. For example, if an ETF has European stock exposure, the spreads on the ETF may be wider after European markets have closed, but while the U.S. market is still trading.

Disclosure I am long many ETFS and they are a important part of my portfolio.