Extended Trade Funds (ETFs)
What are Exchange Traded Funds?
Exchange Traded Funds or ETFs offer a low cost, straightforward method of stock market investment.
ETFs, are collectives based on a wide range of instruments which allows you to diversify your portfolio and in turn potentially reduce risk.
When buying a share in an ETF you are effectively buying a portion of the assets of a fund. These underlying assets are shares in the companies which make up the index or sector. They are listed not only on the London Stock Exchange but also the Irish Stock Exchange and can be traded continuously during the day, like ordinary shares.
Benefits of ETFs
- Instant diversification over a whole market index or sector, so spreading risk and increasing access to range of securities.
- Easily traded and continually priced throughout the working day like shares.
- Currently no UK stamp duty on purchases.
- No initial set up fee.
How do ETFs Work?
Like shares they are traded through a broker at any time of day. Anything you may do with a share you can do with an ETF.
There is no initial set up fee or stamp duty when you buy them. Tax laws may change.
How risky are they?
As a collective instrument ETFs instantly diversify your investment across a bundle of stocks or indices, so smoothing out the sharp ups and downs you may get form holding just one stock, thereby potentially reducing your risk.
How much will it cost?
ETFs are traded like shares at normal dealing commissions from as little as €15.00 per trade online. See full rates and charges.
Where can I find more information?
From the London Stock Exchange: www.londonstockexchange.com/specialist-issuers/etfs/etfs.htm
Which account should I choose to invest in ETFs?
You can invest in ETFs through our Trading Account.