Investing basics

ETF Decoder.

ETF stands for exchange-traded fund. The plain version: a basket of investments that trades on an exchange like a single stock. Useful, popular, often misunderstood, almost never explained slowly enough.

Questions to ask

• What is actually inside the basket?
• What index or strategy does it follow?
• What does it cost (the fee inside)?
• What currency is it in?
• How concentrated is it (one country, one sector, one company)?
• What could go wrong, and would I notice in time?

Learn the language first

You do not need to buy anything to understand what an ETF is.

The full version sits inside Investing Without Intimidation, with examples.