*** Update: this is an old article, for a better description of ETFs and which ETFs to buy, please refer to my socials.
ETFs are a great way to start your investing journey. But what are they and how can you get started with them? This post answers 7 basic questions about ETFs:
- What are ETFs?
- Why do people buy ETFs?
- Which ETFs should you buy?
- Where to buy ETFs?
- What about costs and taxes?
- When to buy ETFs?
- How to buy ETFs?
An exchange-traded fund (ETF) is a basket of securities. A security is a tradable financial asset. ETFs can contain all types of securities: stocks, bonds, commodities, etc.
If you’re looking to invest on the long term, you will be interested in an ETF that gives you exposure to stocks (not bonds). Stocks have historically delivered higher returns than bonds and are subject to a lower tax burden.
ETF example
ETFs can seem complex at first, but not when you break them down. For example, ‘iShares MSCI ACWI UCITS ETF (Acc)’ is: