Step-by-Step ETF Investing for Beginners 2023 (How to Start on Your Own)

Can I invest in ETFs on my own?

This is a million dollar question.
The truth is that you can invest in ETFs on your own, even if you are an absolute beginner.

In this article I explain step-by-step how to invest in ETFs on your own in 2023 simple and fast.

There are Pros and Cons in ETF investing for beginners, but now I will quickly explain what you need to know.

What are ETFs (short explanation)

ETFs are simply a ‘container’ of stocks or bonds (or whatever you need).

Created in 1993, Exchange Traded Funds (ETFs) have exploded in popularity among investors in the last 10 years.

The reason lies in the advantages these instruments offer:

• low management fees
• transparency
• a basket of assets created to easily follow an index

Of course, no investment is perfect, so even ETFs have their downsides.

Today we try to establish once and for all:

• where to buy cheap ETFs
• advantages and disadvantages of investing in ETFs
• ⚠️ risks and dangers

This can help investors weigh up the risks and benefits in an informed way, and decide whether investing in ETFs is a good thing for their portfolios.

Once we’ve established what ETFs are, let’s look at how to use them for investing.

🎥 Video investing ETFs on YouTube

In the video below you can learn the basics of investing in ETFs for beginners in a short video:

Here is a 5-minute video on what they are and how to invest in ETFs:

This video on how ETFs work is a quick summary of a bit of everything you need to know before investing.

Just watch the first 2 minutes without interruptions and everything is already explained.

What do you need to start investing in ETFs?

How and where to buy ETFs?

To buy my first ETF, I need an intermediary.

This is called a ‘trading broker’ in jargon.

There are dozens of excellent brokers to chose from, but picking the wrong one is a big mistake.

The best and easiest tools to buy ETFs are these:

• Freedom24 (Advanced investing broker for ETF)
• eToro (easy and with zero cost ETFs)
• Trade Republic (very cheap, german, already 1 million users)

I’ve used all of these and they are cheap and excellent.

The first one, Freedom24, in addition to stocks and ETFs, also gives the opportunity to buy new shares at the IPO price (the average return is 52% in 3 months)

Investments in securities and other financial instruments always involve the risk of loss of your capital. Buying stocks at IPO prices may involve additional restrictions. The forecast or past performance is no guarantee of future results.

Which ETFs to Buy?

I to buy my first investments online started with ETFs focused on commodities, ❌ but it was a mistake.

I wanted to get rich fast, but it was not the right way to get there.

In hindsight, we are all great investors.

Today, I know that it is much safer and more profitable for me to invest in the largest and most powerful market in the world: the United States.

Statistically, who has invested in ETFs in the US markets for at least 15 years has always had positive returns.

I mean: very positive.

This is why, today I’ll show you the most profitable ETF I invest in the long term.

How to find the right ETF for beginners?

Here is the definitive list of the world’s best ETFs.

I wanted to simplify as much as possible, so I have made a selection of just two stocks.

How to find good ETFs?

Instead of giving you an infinite but meaningless list of best ETFs, I’ve selected just two.

Here are two ETFs that I find excellent for getting started in ETF investing:

• VTI (Vanguard Total Stock Market Index Fund ETF)
• DBZB (Xtrackers II Global Government Bond ETF) or the BND ETF

⚠️ This article is for informational and educational purposes only. RevenueLand is NOT an investment advisor. Readers should not consider this publication to be an offer of personalised investment advice. Any future investments should be discussed with your investment advisor.

The magic is that by buying just these 2 ETFs I am investing directly in 4066 stocks and 1059 bonds worldwide.

To understand it better, with just a few clicks, I have access to thousands of the world’s best stocks, already selected for me. Without me having to know how to do anything.

Small effort: big results.

Why do I invest in these ETFs and not others?

These two ETFs cover a huge slice of the global investment world.

They are 2 ETFs that have worked for many years and are used by millions of investors, both private and institutional.

They cost very little, and believe me, cost is not a detail.

However, don’t trust me and do your own research.

There are dozens of similar ETFs.

Write down your ETFs in the comments below.

How to invest in ETFs in 2023?

I have good news: investing in ETFs is easy.

You can invest in ETFs in 3 different ways:

• 1️⃣ By using a reliable online trading broker 👍🏻
• 2️⃣ By activating automatic investment in ETFs with a robo advisor 👍🏻
• 3️⃣ By using your bank trading platform ❌

I will now explain step by step how I invest in ETFs on my own online, from my computer.

My goal is to do it efficiently, to make money over time.

Can I invest in ETFs on my own?

Yes, I have been investing in ETFs on my own for years in total security.

Always seek advice from a licensed advisor if you do not feel like having the skills to invest on your own.

I wanted this article to ba an actionable one, so I have decided to show you step-by-step how to invest D-I-Y in ETFs.

Come with me…

1️⃣ Investing in ETF step-by-step for beginners

Here’s how I buy the ETF I’m talking about above (the VTI ETF) with eToro, which is a broker that is easy to use.

Don’t forget that also Freedom24 is excellent for this purpose because they have more ETFs from anywhere in the world!

⚠️ Remember there are many brokers right to buy ETFs, this one I’m talking about is just the easiest one I know of, do your research.

Let’s start buy our first ETF as beginner investors!

⭕️ First thing: I register on their site (free):

❌ No need to deposit money to give it a try. That’s because as soon as I register, they give me 100,000 USD “demo” with which to do my tests without risking real money.

In this TEST, I will buy just 50 USD of VTI Vanguard ETF with virtual money (no risk whatsoever).

After registering, I go to the bottom left and “click” on “switch to virtual”:

My test today is to buy the VTI ETF.

I want USD 50 of it.

So I search for “VTI” in the search box:

I now “click” on “trade”.

Then I select 50$ (that’s about 50€):

That’s all!

I have my “VTI” ETF in my portfolio, and it will stay there until I sell it.

I have just become a shareholder of about 4000 of the most powerful companies in the world.

As of now, the aggregated dividends that these companies produce are paid into my account every 3 months.

If I have the patience to wait a few years, I will probably see big results.

Investing in the VTI ETF fund can result in a loss of money over short or even long periods. You have to expect that the fund’s share price and total return will fluctuate within a wide range, just like the general stock market.

The process is similar for more or less all major online trading platforms.

This is just an example from the virtual account. To really invest I have to deposit at least 50€ and do the same step-by-step.

If I had done this with real money, I would start receiving quarterly dividends on my account (real money).

Note: I am not connected in ANY way to the Vanguard ETF issuer. I think it is a good service, but I do not receive any compensation from Vanguard for mentioning them and I have no relationship with them. I also currently use Vanguard ETFs for my investments.

Disclaimer: eToro is a multi-asset platform offering CFD and non-CFD products. 68% of retail investor accounts lose money when trading ‘CFDs’ with this provider. You should consider whether you can afford to take the high risk of losing your money. This content is intended for informational and educational purposes only and should not be considered as investment advice or recommendation.

Investments in securities and other financial instruments always involve the risk of loss of your capital. Buying stocks at IPO prices may involve additional restrictions. The forecast or past performance is no guarantee of future results.

2️⃣ How do I invest in ETFs with a Robo Advisor

Another way to invest in ETFs is to delegate the work to an automated investment manager.

These type of tools are called a ‘Robo Advisors’ and they are easy to use.

But who would prefer an automatic investment manager?

Here is the profile of the average Joe who use a robo advisor to buy ETF:

• I don’t want to buy my own ETFs
• No time to learn how to manage my investments
• Lack of self-confidence in the choice of ETFs

In all these cases, as a beginner investor, I may prefer to invest in ETFs by delegating the matter to professionals.

Here is how investing in ETFs through a robo advisory site works:

1. I subscribe to one of these sites (MoneyFarm is the most popular in Europe)
2. I answer a questionnaire on my risk profile and objectives
3. I receive a model portfolio suitable for me with about 7 ETFs
4. I deposit the money I want to invest for the long term
5. I wait (management is fully automatic)

Having taken these 5 steps, I automatically receive the benefits of having a healthy and cheap ETF portfolio.

This type of investment yields over 6% per year on average over long periods.

Read more MoneyFarm Reviews before investing.

3️⃣ Investing in ETFs with a bank trading platform ❌

Banks, along with the current account, often offer trading facilities at disproportionate costs.

The laziness of not opening a trading account elsewhere often leads us to buy ETFs and shares with our own e-banking.

Unfortunately, to invest in the markets, and thus in ETFs, efficiently, you need to open an account with an online trading broker.

If I don’t want to open a trading account to invest in ETFs, the easiest and safest way is to do it through established and authorised or automated investing sites such as Moneyfarm and the like.

List of Pros and Cons of investing in ETFs

Let’s quickly shed some light on the advantages and disadvantages of investing with ETFs.

Here is a table with the pros of ETFs:

Advantages of ETFs for beginners

The advantages of ETFs are:

• lower costs than funds
• liquidity
• diversification
• tax efficiency
• sector investment
• the possibility of buying in small quantities

Let’s look at the advantages of investing in ETFs one by one:

ETFs cost less

ETFs are traded like shares, so I potentially have access to a diversified portfolio but pay minimal fees.

Large ETFs are liquid

ETFs are traded on normal stock exchanges and can be traded all day long not just at the end of the day (like funds). This can be a nice advantage when volatility is high.

Easy diversification (and exotic ETFs)

Today there are about 8000 ETFs traded worldwide.

So ETFs now cover all major indices and all sizes (from Large Cap to Micro Cap).

ETFs also follow popular or geographically diversified strategies (growth, value, emerging).

By investing in ETFs I can get into specific sectors with very little money. In fact, I can buy even a single ETF and pay miniscule commissions for such an investment.

One advantage of ETFs is that they allow me to make micro investments in exotic countries, rare commodities, leveraged hedges, etc.

ETFs are tax-efficient (accumulation)

Did you know that you can avoid paying taxes on many ETFs?

All accumulation ETFs allow you to pay no tax until you sell them.
Then remember that you can offset all the capital losses you generate with ETFs against capital gains on shares.

Simple sectorial investment

Some ETFs are ultra-specialised in sectors or countries.

By investing in ETFs this way I can find exposure to exactly what I want and at a reasonable cost.

Disadvantages of ETFs

Spoiler: the disadvantages are very few indeed!

Come with me…

To get the most out of investing in ETFs you need to understand the possible disadvantages as well.

Those who know their ETFs, will have no problem optimising their portfolio.

Lower diversification potential

Some ETFs that include specific assets or markets end up including only ‘large cap’ stocks like Amazon. Therefore we may not benefit from the whole index but only from a part of it and without knowing it.

In order not to make a mistake, it is better to know the best ETFs (of the 8000) on the market today.

ETFs are generally passively managed

Passive management is often an advantage, and the statistics are clear about this.

Lack of rebalancing

Most ETFs are not rebalanced.

Usually an ETF is only programmed to follow an index, so that’s ok.

In an index, as the winners increase in price, they become a larger percentage of the index. At the same time, some stocks fall in price and become a smaller percentage of the index. This is normal.

Taking advantage of the disadvantages of investing in ETFs?

Some of the disadvantages described above can be mitigated by investing in a combination of ETFs and individual stocks. In most cases, it is more advantageous to invest in ETFs, but sometimes, a combination of ETFs and shares is even better.
Small investors who initially only use ETFs often add individual stocks as their portfolio grows.

ETFs are the perfect investment vehicle for investors:

• beginners
• with smaller portfolios
• with larger portfolios

…but also for those seeking diversification in a particular geographic area (sector or industry).

So it also makes sense to invest in a mix of ETFs and shares.

Why beginners should invest in ETFs?

ETFs (exchange-traded funds) offer an efficient way to diversify a portfolio without having to select individual stocks or bonds.
They now cover most major asset classes and sectors.

International ETFs, regional ETFs and ETFs for specific market niches provide access to sectors where it might be difficult to buy and sell individual stocks and bonds.

Flexibility

ETFs are versatile and allow easy movement between specific asset classes, such as stocks, bonds or commodities.
They are traded like shares, which means that they can be traded at any time during market hours.

With funds, on the other hand, it doesn’t work that way and everything is slower and less liquid.

Transparency

Most ETFs disclose their holdings on a daily basis.
Other ETFs disclose portfolio holdings to investors on a monthly or quarterly basis.
ETFs generally hold the same securities as the specific index or benchmark they track, although some may only hold a representative sample of the index securities.

Tax efficiency

Due to lower turnover and the in-kind creation/redemption process, ETFs generally pass on fewer capital gains (to be taxed) to investors.

ETFs cost less than funds

This is not always true, but on average yes, ETFs cost much less than most investment funds.

Some ETFs cost only 0.03%.

Now that it is clear that the advantages outweigh the disadvantages, let us see whether it is worth investing in ETFs

Is it a good idea investing in ETFs?

Based on all the information I have gathered and my direct experience, I find it absolutely worthwhile to invest in ETFs.

I am an investor in ETF myself, of course.

By investing in ETFs instead of individual stocks, I can reduce my investment costs and simplify the process.

The quantity and variety of ETFs available on trading platforms today makes trading really easy.

So is it a good idea to invest in ETFs?

I believe that, after all I have said, there is no doubt that ETFs are excellent instruments for investment, but also for financial speculation.

A small investor can replicate the performance of entire indexes, sectors and groups of shares as if he or she were a professional investor. This is indeed a blessing for long-term investors.

In the short term things change, but in this respect ETFs are no different from any other financial asset, be it shares, Forex, CFDs or futures. The problem in the short term is with the trading itself, something most people do not even remotely know how to do. You can lose money by investing in ETFs under the assumption that you are trading short. So it is not a problem with ETFs, but a lack of education and above all a lack of financial experience.

Beware of picking a reliable trading broker in order to invest safely. The two platforms I mention are safe and tested. Read more about how safe is eToro.

Is investing in ETFs safe for beginners?

Look, I hate “it depends” as much as you do, but in this case “it depends” fits here.

There are well-diversified and ‘safe’ ETFs (like the ones I mention in my investments) but there are also leveraged ETFs or ETFs linked to terribly volatile underlying assets.

So, based on what we know of all the 8000 ETFs in the world, we cannot say in absolute terms that all ETFs are safe.

So, is investing in ETFs dangerous?

ETFs are, for the most part, safe from counterparty risk.

For years, many professional disaster forecasters have been claiming that the risk of ETFs comes from the securities lending activity within the ETFs themselves.

Beware, this is a nonsense. The internal securities lending programmes of some ETFs are usually collateralised and safe.

What is the greatest risk of ETFs?

The biggest risk of ETFs is market risk.

I mean, if markets go up, ETFs are just a wrapper for the underlying investments, everything is fine.

So if I buy an ETF on the FTSE MIB and this index goes down 30%, it does not help much that the ETF I am using is cheap or ultra-tax-efficient.

What should I know before buying ETFs?

ETFs follow the fate of what’s inside.

⚠️ Can an ETF fail?

More than failing, an ETF may close down.

A few hundred small ETFs each year go out of business and just stop trading.

So yes, an ETF can fail, but these are rare cases.

The ‘closing’ of an ETF is not a big drama, because simply the fund is liquidated and the shareholders are paid back.

However, it is also no big deal. Often the ETF realises capital gains during the liquidation process, which will be paid to the registered shareholders and these lead to transaction costs and possibly taxes.

Are ETFs safer than stocks?

All investments carry risks, there is no such thing as a 100% safe investment.

With ETFs the risks are limited compared to individual stock investments, because if a company I have invested in goes bankrupt, I lose everything.

By contrast, when I invest in hundreds of stocks through an ETF, the probability that my ETF will one day be worth zero is almost zero.

When individual securities are chosen, it is difficult to recreate this diversification.

Here is a quick comparison table between funds, ETFs and stocks:

We can assume that investing in a well diversified portfolio of ETS can be considered safer that investing in P2P lending loans and real estate crowdfunding.

Is it possible to lose money with ETFs?

Yes, it is possible to lose money investing with ETFs, especially if we try to do financial speculation or trading (…without knowing how to do it).

As I have made clear, it is not difficult to make money in the long term for those consistently investing in index ETFs.

It is a different matter for those who want to overdo it and choose ETFs that are extremely focused on a specific asset, or a country with a high risk.

Now that we have clarified the ‘safety’ of ETFs as an instrument, let’s see what mistakes to avoid at all so…

Is there an ETF bubble?

Along with those who (for a few thousand years) have been announcing the apocalypse are those who claim that ETFs are in a bubble.

There is no bubble in ETFs and I will now explain why.

ETFs are just investment vehicles that group invests shareholders’ assets in various classes of securities, such as stocks, bonds, etc.

ETFs buy exactly the same securities as individual investors or active fund managers.

So, where is the bubble?

Bubbles can only exist in specific asset classes, not in the funds or ETFs that invest in them. There are technical reasons why ETFs can be assumed to distort markets, but this has nothing to do with bubbles.

🚫 What mistakes to avoid when investing in ETFs?

There are a number of typical mistakes made by those who invest in ETFs.

The serious thing is that few are aware of them.

Here are the mistakes to avoid when investing in ETFs:

🚫# False diversification

It is useful to always look at what is inside our ETFs.

Many popular index ETFs, for example, replicate indices!

In the case of the US indices, one easily becomes overexposed on giant stocks, such as Apple, Microsoft, Amazon and Google.

This is not a problem per se, but one needs to be aware of it. If one of these cores sinks and I have many ETFs that include the same stocks I risk overexposure.

🚫# I don’t give a damn about commissions

There are sayings that ‘saving is never gain’, or that ‘you spend as much as you hang’.

Not so with ETFs.

Very similar ETFs can have very different commissions.

In the KIID sheet of each ETF, the annual costs of each ETF are very clear.

🚫# Don’t care about volumes

Many ETFs are traded on different stock exchange.

An ETF could easily be traded in New York, Milan, but also in Frankfurt, London and Amsterdam.

Which one should I choose?

Generally, I am guided in my choice by trading volumes.

If an ETF is heavily traded, it is better and I risk spending less on bid-ask spreads.

🚫# Selling everything for fear of losing

This does not only apply to ETFs, but to all investments.

Selling during a market downturn without having taken into account the time horizon of the entire portfolio is a foolish thing we all do.

🚫# Don’t diversify at all

If I only invest in Euro ETFs I cannot have a diversified portfolio.

The euro is a secondary currency, while the US dollar is the most important in the world.

• The euro has only existed since 2002
• The US dollar since 1785

If I am a European citizen and only invest in USD I am still doing something wrong.

Investing only in equity ETFs is not the best investment idea either.

How much should beginners invest in ETFs?

There is no right or minimum amount.

In principle, I might consider it appropriate to invest a a fair share of my portfolio in ETFs that replicate large indices (if I did so for the long term).

For speculative investing in commodities, particular bonds and exotic countries, I would prefer small amounts.

I decide how much to invest based on my savings capacity, and only after I have set up an emergency fund.

Once I have decided which ETF I want to invest in, I have to work out how many to buy.

If the ETF I want is worth 50€ then I only need 50€ to buy it.

Generally speaking, I prefer to invest most of my money in ETFs, rather than individual stocks and funds.

This is because ETFs just the cheapest way to access the markets, in my opinion.

Unlike other assets, I believe that ETFs can be an individual’s only investment tool, as long as one keeps a good diversification.

But how? Does putting everything in ETFs seem balanced to you?

Most people I know have all their investments in real estate. Their portfolios 100% in real estate does not seem balanced to me.

Having established how logical it is to invest in exchange traded funds, I now want to understand what returns I can expect…

What is the return of ETF investments?

If I want to look at the world’s largest ETFs for an answer then I’m talking about the S&P500, the index of the 500 largest US stocks.

Here is how much the S&P500 has returned lately:

These are the average returns of the S&P500 index:

• 2012: 13.4%
• 2013: 29.6%
• 2014: 11.3%
• 2015: 0.73%
• 2016: 9.5%
• 2017: 19.4%
• 2018: -6.2%
• 2019: 28.8%
• 2020: 16.2%
• 2021: 26.8%

If I want to know how much an ETF on this index yields, I can therefore think of the SPY ETF, The World’s Most Popular ETF.

So how much does an ETF like SPY yield?

Over the past 30 years, the famous (SPY) SPDR S&P 500 ETF has had a compound annual return of 9.79%, with a rather high average volatility.

If I look for the stocks with the highest returns, I can analyse this table:

When I invest in specific sector ETFs like these above, I can earn a lot more than following an index, but the risks are much higher.

How do exchange-traded funds work?

Here is a simple explanation of how ETFs work:

ETFs, or ‘exchange-traded funds’, are precisely that: exchange-traded funds, which generally follow a specific index. When I invest in an ETF, I get a package of shares or securities that I can buy and sell at any time while the market is open.

An ETF can be structured to track virtually anything, from the price of a commodity to a collection of thousands of securities.

Sometimes ETFs can even be made to track specific investment strategies.

You should know (but don’t care yet) that ETFs have two prices: the market price and the NAV (net asset value). The NAV is calculated every day after the markets close and reflects the value of an ETF’s investments at that precise moment.

How to build an ETF Portfolio?

To build a well-crafted ETF portfolio, you need to be clear about your objectives.

How to choose ETFs as a beginner?

Generally, to make a basic diversified ETF portfolio you need at least 2 ETFs.

These ETFs are:

• One World equity ETF (all countries of the world)
• One World or European bond ETF

To these three ETF can be added, depending on my time horizon and risk appetite:

• Emerging ETFs
• Gold ETFs
• High Yield ETFs

ETFs can be used to fight inflation but also to buy gold as an investment.

Here is a simple image than can resume this ETF strategy:

Here is an excellent video on how to build a simple ETF portfolio for beginners:

Is this a guide to investing in ETFs?

❌ No, thank you!

All this is only a rough guide, it cannot replace well-done financial advice.

An example of ETF investing done right?

I start with simplicity.

Complex ETF investment strategies are fascinating, but they are of no use to the the beginner and to the average investor.

So a well-done ETF investment includes less than 10 of the best ETFs.

Per costruire un portafoglio di ETF ben fatto, è necessario avere chiari i propri obiettivi.

In 2021, there were 8,552 ETFs listed globally, up sharply from the 276 ETFs that were available in 2003.

ETF statistics

In 2021, ETFs managed more than USD 10 trillion in assets worldwide.

UCTIS harmonised and non-harmonised ETFs in Europe

That ETFs can be harmonised does not say much to those who do not know what it means.

Let’s see what non-UCTIS harmonised ETFs mean.

Non-UCTIS are investment companies and funds that are not domiciled in an EU Member State.

UCTIS is a European regulation

What are harmonised ETFs?

Harmonised ETFs and investment funds are a type of mutual fund that complies with the EU UCITS Directive.

Which ETFs should be bought, the harmonised or the non-harmonised.

Unfortunately, there is no rule.

Some online brokers do not allow the purchase of non-harmonised ETFs, but in my opinion this is a pity, because the largest and most important ETFs in the world are American, non-harmonised and non-European.

Mutual funds Vs ETFs

How do you choose between investing in ETFs or mutual funds?

A big difference between ETFs and funds is that ETFs can be traded in real time like stocks, while funds only trade at the end of the day.

Mutual funds are often actively managed, with managers buying and selling securities within the fund in an attempt to beat the market.

Actively managed mutual funds tend to be more expensive than ETFs, due to the higher operating costs associated with active management.

So which is better, investing in ETFs or funds?

It depends on the strategy.

There are good funds and bad ETFs, but also the opposite.

There are also cheap funds and expensive ETFs.

On average, ETFs are better, but for particular tax reasons one might prefer funds.

Why do you recommend ETFs?

This is a common question in online forums about ETFs.

I don’t know about others, but I don’t recommend anything. That is all you need to know about ETFs, but investment decisions are absolutely private and made on your own responsibility.

OK, I have saved you from wasting your time looking for ETFs to invest in on the forums.

Should I buy ETFs focused on the booming Chinese markets?

Lots of investors believe that the Chinese markets are about to boom again after some years of struggle.

To take full advantage of this specific market forecast it is possible to use trading platforms that offer the Hong Kong stock exchange (HKEX).

Now come let’s look for books or reliable resources….

Books investing in ETFs

I don’t think you need a book to learn how to invest in ETFs.

The amount of information needed to invest well in ETFs is best limited, to avoid ending up building a stupidly complex portfolio.

If I don’t know and don’t want to learn how to invest in ETFs but have realised that it is the smart thing to do right away, I can delegate the matter to a robo advisor and never think about it again.

Is there a free course on investing in ETFs?

On some websites you will find a number of well-done courses to learn how to invest in ETFs and the markets in general.

How not to pay tax on ETFs

It is impossible not to pay taxes on ETFs, but what you can do is to adapt your investments to your tax situation.

The easiest way to avoid paying tax on ETFs is certainly to prefer accumulation ETFs, where you only pay tax when you sell. These kind of ETFs are perfect to take advantage of the magic of compound interest.

One more piece of advice may be to talk about it to a tax consultant.

Investments in securities and other financial instruments always involve the risk of loss of your capital. Buying stocks at IPO prices may involve additional restrictions. The forecast or past performance is no guarantee of future results.

Conclusions Investing in ETFs for beginners

Let’s make a mighty summary of all this:

• ETF simply stands for exchange-traded fund. ETFs are a diversified basket of investments, not too different from mutual funds.
• ETFs can be a good choice for both novice and experienced investors.
• ETFs are traded on the stock exchange like shares and the minimum investment to start with is very small.

To invest in ETFs, you need to open a brokerage account (online broker).

It may be a good idea to start by opening a free virtual account on a trading platform and place your first ETFs in your portfolio without risking anything.

Congratulations! Because you now know practically everything you need to know about investing in ETFs wisely.

Write about your experience with ETF investing as a beginner or experienced trader in the comments!