Advice on investing in ETFs


I am a newbie when it comes to investing. I want to dip my toes quickly but with small capital and have the following questions that I request the community to answer.

  1. I know ETFs in general are good for the long term but does investing in a lot of ETFs (like >30 or so) in a pie hurt? Is that even recommended? Do I incur a lot of fee if I have to withdraw some funds from them (proportionately)?

  2. Currently, I have split my investments to into 3 major pies (Stocks, general ETFs, Commodity ETFs (metals)) to invest in the ratio of 6:3:1. Can anyone advise, on a general level, if this is a good idea? If not, can you recommend any better strategies?

Thank you. :slight_smile:

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Really depends on your targets, risk tolerance and time horizon of the investment. Also, your currency plays a role.

For most long term investors, 2-3 ETFs would be enough; one for stocks (VWCE for all-in-one solution or a combination of IWDA+IS3N for developed and emerging markets), and one for bonds (for the hedging part of your portfolio) like the iShares Aggregate bond ETF (ISIN: IE00BDBRDM35) , hedged to your currency.

You can have more than 2-3 ETFs, but then you end up paying a lot of money on TERs. Keep it simple and efficient!

I would add a small cap all-world as well, because VWCE doesn´t have it. You can use either WSML (USD) or IUSN (EUR) - depends on your currency and whether you´re using the Autoinvest feature (IUSN is not yet fractional).

thanks for the tips :slight_smile:

Thank you. my currency is EUR. Btw, would it matter if I invest in a USD ETF or an EUR ETF? does it make an impact on the long run? Or in terms of fee?

If you have a possibility to buy ETF in Eur, then do it. If not, there are no exchange rate fees, however FX is fluctuating so in the short term, you might see some impact. However, if you are investing long term, it should be ok, as FX tend to even out.

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I actually invested in a looooot of ETFs (~ 40). Should I then sell them? I might already incur a lot of fees then, am afraid. :grimacing: :frowning_face: Or do you recommend any better way to deal with this?

Thank you. I will continue with USD then may be. More so because I can put it as part of a pie.

I would sell them, most likely they are overlapping and it´s not cost effective at all. You can use the strategy @Johnny recommended (plus maybe add some small-cap ETF) and you will be fine. Btw - you won´t pay any fees directly, they are priced in the share value of ETF already. Make sure that you know what you are buying first - everything is on the internet, just use the google :slight_smile:

Great. No, I didn’t buy whatever I would ofc :slight_smile: I bought mostly different variants of S&P 500, energy, REITs & commodity ETFs. :slight_smile:

Definitely no need for that, for example S&P ETFs, mainly the difference is in the ETF provider, fees and how big is the fund (and trading currency or if it´s hedged). Also make sure to differenciate between accumulating and distributing ETF - there might be a tax implications related to the dividend payment.

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