I never liked mutual fund, simply because that I can usually find a ETF (or combination of ETF) that basically behave the same as any given mutual fund, but I do not have to pay any 2% "management fee" to any mutual fund manager (who does not give me any better return than me, anyway). Another advantage is that ETF is usually trade frequently, so it is easy for you to capture the price you want (mutual funds and unit investment trusts can only be traded at the end of the trading day).
Each ETF is constructed for a given purpose. Most common are index FTE, which basically track a given stock market indix. For example, if you want to diversify your investment to track overall US stock market or US high tech market, you simply by SPY and QQQQ
Another example is that if you want to invest in China but you have no idea which Chinese company to invest, you can by FXI which tracks the major Chinese company or HAO which is more focused on small cap Chinese company..
Another ETF I like is commdity ETF. For example, if you want to invest in Gold, you buy GLD. If you want to invest in oil, you buy USO.
There are other types of ETF, but I have not find them to be much useful. For example, I can not figure out why I want to buy bond ETF vs. directly invest in bond. And, I have not find a good currency ETF (say CNY or CYB) that I would like (to invest in currency in developing country).
There are lots of ETF you can choose. You need to determine for what purpose you want for your ETF, and then get a list of ETF through your online broker website (every one of them, such as Etarde, has ETF information readily available). Or you can simply go to Yahoo! ETF website, where you can find tons of useful information.
