Image by John & Fish
This question crops up in comments from time to time, and I thought it would be a good idea to do a quick post on it.
How to buy ETFs?
ETFs can be bought just like stocks, and if you already have a stock portfolio, buying an ETF should not present any problems to you at all. You have to find the symbol of your ETF, go through your broker, place a market or limit order for it, and you are done. Thatâ€™s it â€“ itâ€™s that simple.
Possible cause of confusion
It is my conjecture that a little confusion is caused on this topic by the following two statements (both of which are true and seen often):
- ETFs can be traded like stocks
- ETFs can act as an alternate to mutual funds.
It is true that ETFs are like mutual funds because they hold positions in underlying assets such as stocks, future contracts, commodities etc. (like mutual funds).
However, the difference is that they trade on a stock exchange all day long like a stock (unlike a mutual fund). That also happens to be the dominant similarity they have with stocks.
It seems to be me that a lot of people hear that they can buy ETFs instead of mutual funds, and try to buy ETFs like they would buy mutual funds. But, when they are unable to do this, they get confused.
This is just a guess though, and it could well be that the question crops up because people are just unfamiliar with them. There is so much information on asset classes, risk management, asset allocation and other subjects of investment management — that sometimes it becomes difficult to know where to start, and find answers to even simple questions.
48 thoughts on “How to buy ETFs?”
Quoting from SBI bahrain website
Demat and Portfolio Investment Schemes in India for NRIs
To opt for Demat facility and to have the Portfolio Investment Scheme operationalised, please contact any authorised branches of State Bank of India in India. For more details, Check out SBI NRI Services (https://www.onlinesbi.com/nri/) Your enquiries on NRI services can be sent to firstname.lastname@example.org
i am working in bahrain, and i want to buy some gold etf,I’ve PAN card and a SBI saving account in bahrain. but no demat or trading a/c.
how can i process further if u please help me with that.
You need a Demat to do this and then you need a NRE / NRO account setup that’s linked to this demat account as well. Call your SBI bank and they will tell you the process.
How do i get to know that the expense of the particular company is lower than other when we invest in gold etf.
It is commonly declared so you will find that in news articles about it. Value Research also publishes this and then of course the website of the fund also has this info.
i want to invest rs.100000 in etf. what will be the return within one month. how can i sell and buy again