Gold EFT Investment

[Rockey]

Hello, My name is Rockey. I am a freelance WordPress web developer. Recently, I have earned and saved some money. I want to invest this amount. But I am perplexed. I have listened that Exchange Traded Funds (EFTs) is a good option for investing. What is the procedure of EFTs investment? How can I invest?  

[Simon Mugo]

Hi Rockey, the process for investing in an ETF is quite simple as all you need is to open an account with a broker who offers ETFs to its clients and then purchase the ETF through the broker.

The most liquid ETFs are those listed on New York exchanges, hence, you'll need to open an account with a broker who has access to them. I would recommend Interactive Brokers if you reside outside the US, especially in developing countries, as they are the only US broker who accept international clients from most countries including non-G20 nations.

[Luka Rice]

Hi Rockey, thanks for asking the question.

Exchange-Traded Funds (ETFs) are extremely popular among investors nowadays because they have very appealing expense ratios, and offer some benefits compared to traditional mutual funds.

The first step for trading ETFs is setting up a brokerage account. ETFs work like individual stocks because you can trade them only during trading hours.  

You can choose between various brokers today, depending on which you think will suit your needs. Some financial services companies such as Vanguard and Schwab have their own ETFs which you can trade without paying commission. Other brokers have agreements with third-party ETF providers under which they charge no commission fees when trading ETFs. You should probably do some research and see what each broker offers and then decide which one will work the best for you. 

Another thing to keep in mind when choosing which ETF to invest in is checking out their costs. There’s a great number of ETFs to choose from and every one of them publish their annual expense ratios. These ratios refer to the percentage of total fund assets that’s meant for covering the costs of the fund. Lower costs will save you some money and some of the most competent ETF providers have expense ratios lower than 0.1%.

It’s also a good idea to keep your ETF portfolio diversified. I recommend choosing ETFs that are in different categories like stocks, bonds, real estate, and so on. Increasing your exposure in every category is a good thing to do as well. With stocks, for example, different ETFs that have companies of various sizes and belong to different sectors will do you good in terms of risk management. 
 

[Miller Oliver]

Thank you for your detailed answer.

[Richard Stip]

Good luck!

Edited September 2, 2021 by Richard Stip

[Manragorn]

Have you thought about bank deposits? It do not require the depositor to have any special knowledge about financial instruments. They also have clear dynamics of the growth of funds. You can independently calculate the profit on any date or ask the bank for a schedule of volume changes.