I'm pretty new to investing, still learning about stocks and shares, etc. But I am interested in opening an index tracker fund. The issue is I don't have that much money, probably the most I could put in initially would be around £2000 ($2850) and I will then be putting in around £200 ($285) a month but probably increasing in future.
All of the index trackers I have seen require at least £100,000 to start with. Are there any which don't have a set sign up amount or have a lower amount? If not, what are some savings schemes that pay compound interest that I could join with this amount? Or should I just keep all my money in ISAs (tax free savings accounts - similar to IRAs in USA). Bear in mind I'm looking for UK accounts.
You can use robinhood if you are in the us and buy Vanguard funds.
If you are from another country you can check drivewealth, since it only charges 2.99 per trade.
>>1298901
>drivewealth
Thanks mate, no I am not in the US so I would have to go down this route, but isn't there anyway I can do it without opening a dollar based trading account? Surely there must be some UK based options?
>>1298909
If you are younger than 23 you almost have the required minimum for Interactive Brokers, which I believe would allow you to trade in the London Stock Exchange (and almost every market).
https://www.interactivebrokers.com/en/index.php?f=4969
>>1298919
nah I'm 29 unfortunately. Can I just invest in an ETF like Vanguard's through any online brokers? Also, what's the process of investing in an ETF through a broker? Sorry but I'm a complete newbie to this desu.
don't.
indexes are about to collapse.
they raised their risk assesment to ensure rentability.
in the high yield, some stock will most likely collapse.
and last danger, once you buy a contract, your money is locked for X years. you can withdraw with very high fee.
your investment level is too weak, too.
if you want to learn shit and have fun.
try eToro if you're in EU (cysec represent) or shit like this.
run simulation mode and learn the rope.
index golden era was 2008-2016. never forget.
>>1298952
I'm one toro now in simulation mode but I wouldn't put real money in control of anonymous users on there I may start buying and selling on there on my own once I get hang of it
>>1298952
>indexes are about to collapse.
[citation missing]
Stop guessing the future, moron.
>they raised their risk assesment to ensure rentability.
>in the high yield, some stock will most likely collapse.
Is this English? It sounds like you cut-and-pasted some random investing words.
>once you buy a contract, your money is locked for X years
That's not how index funds work. Not ever.
Please leave /biz/. Your kind isn't wanted here.
>>1299177
>That's not how index funds work. Not ever.
Yeah I hadn't heard of this before.
Question:
I am on etoro now and there are a list of indices that I can trade in, i.e.NSDQ100 UK100 etc. Very noob question I'm sure but are these ETFs? Also, why is the S&P500 not available there? Is it only available through certain brokers? If indeed these are ETFs, what's the difference between buying them on etoro, etc as opposed to through Vanguard, Blackwater, et al.
I've been reading up about them but still quite confused about the practicalities.
>>1299286
https://www.bogleheads.org/wiki/UK_investing
>>1299361
Thanks. I've done a bit more reading and realised that etoro does infact offer the S&P 500 index except they call it the SPX 500.
Quick question: I looked at some ETFs tracking the S&P500 and they were saying the returns were about 5% for the last 5 years. Presumably this is not just 5% of my initial investment? Otherwise it makes it pointless for me really as I am only investing a relatively small amount, around £1000 to start with, so would only get £50 profit after 5 years. I know this is not exactly how it works with stocks but is there a more accurate way of calculating the expected return on 5%? Also, what is the main difference between trading in indices directly and investing in an ETF? Just the fees?
>>1299576
Anyone?
>>1299768
Le bump
>>1298952
>indexes are about to collapse.
Time in the market beats timing the market.
>>1299576
what is the main difference between trading in indices directly and investing in an ETF? Just the fees?
>>1300802
>trading in indices directly
These are nonsense words. You're not stating your question correctly, which is why no one is answering you.
I realize you're new to this, but are you taking the time to try to learn it on your own? We're not here to spoon feed you. I already linked you to the best site to start learning:
https://www.bogleheads.org/wiki/Getting_started
>>1300802
You can't trade indices directly without using options. ETFs track indices by buying stocks in proportions as to replicate the index. Some ETFs replicate index or price of an underlying by buying futures so you have to think about what happens when the fund rolls their contracts. VXX or USO is a perfect example of this.
Difference between regular funds and ETFs is that you can buy and sell ETFs as if they were stocks. Funds often take a few days for your money to be cleared and you really don't know at what price you buy or sell things. General rule is, if there is an ETF and a regular fund which costs the same in management fees, you choose the ETF for the liquidity.
I don't really know how the UK works with this, but both Sweden and the US have low cost ETFs that replicate the largest index in the respective country.
If you decide to invest in the US, don't buy SPY now since SPX is almost at record highs
>>1300857
>General rule is, if there is an ETF and a regular fund which costs the same in management fees, you choose the ETF for the liquidity
You statement implies that ETFs are categorically superior to traditional funds, which isn't true. They each have their advantages and disadvantages. For example, there are typically no fees or commissions when trading traditional index funds, whereas you typically have to pay a commission when purchasing an ETF (or jump through hoops to avoid it). Traditional funds are purchasable in any dollar amount because they use fractional shares, whereas you must purchase ETFs share multiples. Notably, traditional funds typically offer automatic investment options, such as automatic periodic transfers from your bank accounts. ETFs cannot do this because each trade must be specifically authorized.
It bears mentioning that ETFs tends to test investor discipline more than traditional funds. Because they trade like stocks, people tend to make the same mistakes with ETFs that they do with stocks, such as frequent trades, market timing, and emotional trading. While this can also happen with traditional fund, people tends to leave them alone, to their long-term betterment.
I do agree that for the most typical investors, ETFs beat out traditional funds if you impose the discipline to treat them as the long-term investments they are. However, everyone should do their own analysis and decide the best fit for themselves (which may include a mix of both, btw.).
