3 STEPS TO INVESTING IN ETFs

Capital at risk. All financial investments involve an element of risk. Therefore, the value of the investment and the income from it will vary and the initial investment amount cannot be guaranteed.

BlackRock recommends that investors see a qualified financial adviser before making a long-term investment decision.
All investments involve some degree of risk, and your money may be tied up for some time. It is therefore important to act on the best advice available before embarking on more complex savings plans such as pensions or funds that aim to meet school fees. Alternatively, investors can talk to BlackRock’s Investor Services team for general enquiries, please note that our team are not authorised to provide any financial advice.

1. OPEN AN INVESTMENT ACCOUNT

If you do not yet have an investment account, you can open one at your bank an online broker. Nowadays, you can almost always do this online and verify yourself through a videoident or postident procedure.

2. SELECT ETF

Find out more about your choices on our pages, through further online research, or by consulting with your bank or an independent advisor.

3. SETTING UP SAVINGS PLAN

When setting up your savings plan, you will need the security identification number (ISIN) of the selected ETF, the desired interval (usually monthly) and the rate. In most cases, a savings plan can be set up for as little as €25 per month.


YOUR INVESTMENT OPTIONS WITH ETFs

With an ETF savings plan, as with a one-time investment, you have the option of investing in different asset classes: you can invest in stocks of companies, in corporate or government bonds, and in commodities.

You do not invest in individual securities but in a fund that tracks an index. For example, an ETF on the MSCI World index, which invests in the 100 largest companies worldwide, tracks the performance of this index. In this way, you automatically invest in a broad-based basket of individual stocks.

Of course, you can also divide the monthly rate you want to save among several ETFs and thus diversify your investment even more. Savings plan instalments can be flexibly adjusted or suspended in your securities account. You can also sell units again if you need short-term liquidity.

THE AVERAGE COST EFFECT

A savings plan has what is known as the cost-average effect on your investment: owing to the constant investment amount that you save and invest, e.g. monthly, you trade independently of the respective stock market sentiment. If prices are high, you buy fewer fund units with your savings rate. If prices are lower, on the other hand, you will receive more units for your savings amount. What ultimately counts for you is the average price you have paid for your units over the investment period. This does not guarantee that you will acquire your units at a lower price overall than through a one-time investment, as is sometimes conveyed. However, it does relieve investors of the possible worry of having to wait for the right time to invest.

Costs will vary depending on provider and investors should seek independent advice prior to investing.

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THE ETF SAVINGS CALCULATOR

Quickly and easily check how much you need to set aside to achieve your financial goals.