learning about ETF's. Small sum to invest.

A

apple1

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Folks,
Was recently the recipient of 5,000 which I hadn't planned for nor expected. As such, I'm
happy to have a wee gamble of sorts though i feel the sum doesn't really merit
investing in individual shares given the cost of trading and the number of individual
companies I'd have to invest in to spread the risk. This brought me to the possibility
of investing in an ETF (which admittedly I know nothing about), hence the request
for advice. Would be grateful if someone could point me in the right direction to
'educate myself' or even offer an opinion on ETF's they believe may perform well
in the medium term. Thanks in advance, apple
 
Apple, I would certainly not reccomend any particular ETF. In that I say I am not qualified to do so. There is plenty of information about these products on the web. The main thing about these, apart from the huge variety of the choice of products are the charges applicable to these products where the annual charges are around 0.4% in total versus near approximaterly 2% for standard Index Linked or Unit Trust Investment Policies and no Exit Penalties.
 
Don't put it all into one ETF, diversification is the key to lowering risk. Maybe 1000 into 5 ETFs or funds is a good idea.

You first need to have a share trading account e.g. NIB have a good one if you are with them. There is a charge per trade which is around 20 euro.

I have some invested in Wisdom Tree's Emerging Markets ETF. There are other non-ETF funds you can invest in e.g. Edinburgh Investment Trust - it trades on the stock market.
 
Just remember it literally is impossible to beat the market.
 
Actually how about putting the 5k (or as much as you allowed depending on various things) into your pension if you have one? Do it before Oct 31st to avail of top rate of tax relief if you pay tax at that rate at the moment, tax relief will be 33% after that I believe.
 
And if its not a self regulated pension scheme, you will end up paying a heap of charges
 
Thought about the pension issue ok, but I'm 30 years away from that and am interested in any event in dipping my toe into the investment scene. Given I never expected the 5K, I reckon it may be worth the gamble. If I make a few bob, great. If I learn something while I'm at it, even better.

Mercman, do I take it you favour this route (i.e. ETF) rather than dumping into an Index tracker etc.? Thanks,.
 
Personally I would prefer ETFs than an Index tracker. They are a relatively easy product to learn about and cheap to trade, allthough the taxing of these are different in Ireland. Search the web for tools on learning about these products. Many investors make large amounts of money trading ETFs. Do your own research but the old fashioned investment Policies are away with the birds in my opinion. If you look at my thread under Investments titled 'the real cost of Investments'., This should assist you in making your mind up, but me, personally am no profesasional but would prefer not to see others go through what I have been through
 
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