Groww Logo
search
Login
Register
etfs

Should i invest in ETF?

Is ETF (Exchange Traded Fund) a good investment?

Asked
Answer this Question
close

Your Answer

Attach Portfolio/Mutual Funds: (Optional, Max limit allowed : 3)
search
Post your Answer

Similar Questions

1 Approved Answer

Pijush Kanti Biswas

Exchange-traded fund(ETF) is kind of an index fund that invest in an index, a commodity, currencies, bonds etc. ETF is an excellent investment instrument for achieving investor’s goals, provided used wisely. Let’s got through various advantages and disadvantages of investing in ETF.

Advantages:

  • They are listed and traded on a stock exchange like common stocks. So, can be bought and sold at any time of the day.
  • ETF includes almost every investing asset class including commodities or currencies. It gives you exposure of any market, any sector in the world.
  • Liquidity of ETF is very high and charge lower fees.
  • Investors can place different types of order for buying ETFs like stop-loss order, buy on margin etc, as they are traded like stocks in market.

Disadvantages:

  • As ETF includes wide range of investment option, deciding on a particular instrument is sometimes get difficult for an investor.
  • Proper knowledge of ETF is needed to invest.
  • For investing in global ETFs, following fundamentals and credit worthiness of currency in that country is very essential. Along with this, economic, social and political instability can also hurt your investment.

So, after going through both pros and cons of investment in ETF, you will be able to make better investment decisions. ETFs are only 25 years old investment instruments, growing in popularity exponentially. ETF may be cheaper option when it comes to investing a large sum in one block.

Happy Investing!

Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.
Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, investment goal, time frame, risk and reward balance and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs.
MOST POPULAR ON GROWW
MUTUAL FUNDS COMPANIES: ICICI PRUDENTIAL  | HDFC  | RELIANCE  | ADITYA BIRLA SUN LIFE  | SBI  | UTI  | FRANKLIN TEMPLETON  | KOTAK MAHINDRA  | IDFC  | DSP BLACKROCK  | AXIS  | TATA  | L&T  | SUNDARAM  | DHFL PRAMERICA  | LIC  | JM FINANCIAL  | BARODA PIONEER  | CANARA ROBECO  | HSBC  | IDBI  | INDIABULLS  | MOTILAL OSWAL  | BNP PARIBAS  | MIRAE ASSET  | PRINCIPAL  | BOI AXA  | UNION KBC  | TAURUS  | EDELWEISS  | ESSEL  | MAHINDRA  | QUANTUM  | PPFAS  | IIFL  | ESCORTS  |