What To Look For When Selecting An Index Fund or ETF - Tom's Personal Finance

The Making Money Simple Podcast

Tom from @tom.tpf joins me on this podcast episode to go through exactly what to look for when selecting an index fund or ETF to invest in.

Investing really can be made simple - invest into a global fund and do this consistently for decades.

However, how can you pick a fund? What should you look for?

It can get a bit technical. And in this episode we run through the nitty gritty of exactly what criteria to look for when selecting a fund.

This includes the underlying holdings, tracking errors, fees, fund size (or AUM 'Assets under management), and more.

On top of this, when it actually comes to then picking a fund on an investment platform and actually investing your money, there are a few more important differences.

What are they? They are differences in the fund provider, how dividends are treated and currency.

This episode will be a very valuable listen if you are planning to invest into funds for the long term.

Timestamps:

0:00 - Intro

1:34 - What is an ETF?

2:25 - Why is this a good way to invest?

3:54 - UCITS

5:11 - Underlying holdings

9:38 - Fees

11:39 - Domicile

13:50 - Tracking Error

17:09 - Fund size, bid ask spreads, liquidity

20:14 - Method of replication

24:13 - Fund provider

26:04 - Income vs Accumulation

28:45 - Currency

33:16 - Summary

Listen to this podcast episode for the full details.

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