ETFs for beginners

Hello at justETF! It is our mission to provide you with the most important information to get you started with ETFs. Simply, cost-effectively and without gambling: We will explain in 5 steps how to invest your money in ETFs – as a one-off investment, an ETF savings plan or a combination of the two.

Welcome to the world of ETFs!

It’s awesome that you want to invest money in ETFs! We have summarized everything you need to know. Follow our checklist and you could own one or more ETFs in exactly one week. From then on, you won't have to worry about them anymore. 
Here's how to do it step by step
  1. Read up: Familiarize with ETFs in the next hour.
  2. Calculate: Decide how much money you want to invest in ETFs and whether this should be a one-off investment or a savings plan.
  3. Open a brokerage account: Decide on a broker (if required) and open an account with just a few clicks. However, it takes a few days until you will receive all the necessary documents – and therefore this is the longest part of the whole process.
  4. Select ETFs: In the meantime, decide on a global ETF.
  5. Order your ETFs: As soon as your brokerage account is available, you can start investing in ETFs! 
We promise: We will guide you through all 5 steps. So let's get started. Let's dive into the topic of ETFs.

1. Read up or: Why ETFs? 

ETFs are becoming more and more popular due to their many advantages: ETFs allow you to become active on the stock market in an uncomplicated way and with little risk. The most important innovation is that ETFs are traded like shares, but you invest your money in a whole range of companies with just ONE order – and are automatically broadly diversified.  

The most important facts about ETFs

  • With ETFs, you can build up assets independently, cost-effectively and over the long term – without expensive bank advisors.
  • ETF stands for Exchange-Traded Fund. "Exchange-traded" means that you can buy and sell an ETF on the stock exchange. "Fund" means that you pool your money together with thousands of other investors to buy shares & co. super-efficiently. Not only is this the most sensible way to invest, it also saves you a lot of time and effort. 
  • The secret of ETFs is that they replicate an index. They therefore follow a stock market barometer. You may have heard of the famous S&P 500 index, which tracks the fortunes of the leading US companies, including names such as Apple, Tesla, Amazon and Alphabet.
  • You can think of an ETF as a pot in which the shares of the companies that make up the respective index are bundled together. The results of the ETF follow the results of the index. In this way, you receive the return of the market – whether positive or negative – as well as dividends. 
  • This index-tracking technique is supported by personalities such as Warren Buffett.
  • The ETF provider deducts a fee to cover its costs, but this is minimal. For example, a typical ETF fee of 0.1% equates to a fee of €1 per year for every €1,000 your ETF is worth.
  • ETFs are just as safe as actively managed funds because the money invested in ETFs is considered a separate asset. If the ETF provider goes bust, your money is still protected. However, ETFs are significantly cheaper than active funds.
What does that mean for you?
You don't have to make bets on which individual shares will rise and which will fall next. Instead, you simply spread your money across all important markets: a global equity ETF such as the MSCI World buys a large selection of company shares from all over the (developed) world – you then have a proportionate share in their ownership. The good thing: It doesn't hurt so much if an individual share performs worse.
A crystal ball please
Predicting which shares will perform best tomorrow is an almost impossible task. Not to mention doing so consistently over a period of years. 
Experts strongly advise (new) investors not to invest their money in individual stocks, but to diversify broadly. And this is exactly where ETFs come into play. There is a large selection of ETFs with which you can invest all over the world. Of course, you can also use several ETFs if you want to invest more money in specific areas, e.g. in the specific stock market, green energy, technology or even in other forms of investment such as bonds and gold.
No other financial product allows you to do this as cost-effectively as ETFs. They are simply newer, better and more innovative because the ETF industry is so competitive. This is a market where the consumer wins. 
Don't be afraid of the stock market
Many people shy away from the risk of being invested in the stock market and are afraid of high losses. The investment period is the key to success here.
Our analysis shows that long-term investing significantly reduces investment risk. Over the last 50 years, an investment in the so-called MSCI World Index would always have generated a positive return if you had been invested for at least 14 years.
Buy and hold is the key to success.

ETFs in figures

ETFs in figures
1: Assets under management in ETFs in Germany, source: Statista; as at: 11/2023 2: Simulation for EUR 300 monthly savings instalment over 30 years, TER: 0.2%, approx. Return 5.0%, source: justETF savings plan calculator 3: Return MSCI World Net in EUR (1971-2021), own calculations, distributions reinvested 4: Source: MSCI; as at: 11/2023 5: Cheapest MSCI World ETF vs. average cost of active equity funds, sources: justETF. Costs of active equity funds, sources: justETF Research; as at: 07/2021 and Morningstar Active-Passive Barometer; as at: 2021 6: Active mutual funds on US equity markets vs. corresponding indices, performance over 15 years, source: S&P SPIVA Scorecard US Funds; as at: 06/2021
Let's now turn to step 2 and the question of how much money you want to invest in ETFs.

2. Calculate or: Savings Plan vs. One-Off Investment

Because they are so simple, ETFs are ideal for anyone who wants to invest money – whether they are new to ETFs, experienced investors or large financial institutions that build entire investment strategies with ETFs. 
You can buy an ETF once or pay regularly into an ETF savings plan. With an ETF savings plan, you automatically invest an amount that you specify each month (or for a different savings interval) in an ETF of your choice. Fully automatically. Set it up once with your broker – done. (However, you can make changes at any time).
Whether it's 1, 50, 100 or even more euros per month: ETF savings plans are one of the best and cheapest ways to build up assets in small steps. ETF savings plan are often described as the "ideal way to save funds".
And now it's time for step 3: opening your brokerage account!

3. Open a Brokerage Account or: Which Broker is the Best? 

The prerequisite for buying ETFs is a brokerage account – i.e. an account in which your ETFs are held. You can open such an account with an online broker free of charge with little effort and invest money in ETFs.
In recent years, so called neobrokers have become increasingly popular. These are online brokers who often charge very low or even no fees for buying and selling ETFs and also offer ETF savings plans at the best conditions.
How to get started
  1. Decide on an online broker. Our Online Broker Comparison will help you decide. Please use Google if no online broker comparison is available in your country.
  2. Open a custody account via the app or the broker's website. The whole process doesn't take very long and in many cases you can easily identify yourself using the video identification procedure.
  3. Once you have completed all the formalities, you have to wait until your account is opened. This takes a few days. From then on, you can transfer money directly into your custody account – and invest in ETFs immediately.
Since you now have a broker: Which ETFs are right for you? Let’s dive into that in the next section.

4. Select ETFs or: What are the best ETFs for you?

One of the most important investment rules is: Don't put all your eggs in one basket, spread the risk!
If you follow a few simple rules when making your selection, you are guaranteed to find the best ETF(s) for you. You can search and decide in many different ways. We will show you 4 options. Important: Copy the ISIN of the ETFs you want to order. The ISIN is the identifier for every ETF and is found at the top of each ETF profile.

Option 1: Simply create a Savings Plan on a global ETF

 justETF tip: Create a savings plan on a global equity ETF – as is estimatedly done by over 80% of all ETF investors. 
Here you will find an overview of all available MSCI World ETFs. You can sort them according to various criteria.
Fund size
in m EUR
in %
Use of
1y in %
ETF savings plan
6,660 0.30% p.a. Distributing Swap-based 22.49% ETF savings plan
for FR0010315770
2,715 0.31% p.a. Distributing Full replication 22.22% ETF savings plan
for DE000ETFL508
3,679 0.38% p.a. Accumulating Swap-based 22.20% ETF savings plan
for LU1681043599
6,778 0.12% p.a. Accumulating Sampling 22.30% ETF savings plan
for IE00BFY0GT14
150 0.10% p.a. Accumulating Sampling 22.09% ETF savings plan
for IE00BD4TXV59
359 0.15% p.a. Accumulating Sampling 22.15% ETF savings plan
for IE000UQND7H4
1,692 0.19% p.a. Distributing Swap-based 22.24% ETF savings plan
for LU2263803533
221 0.10% p.a. Distributing Sampling 22.11% ETF savings plan
for IE00B7KQ7B66
4,736 0.19% p.a. Accumulating Swap-based 22.11% ETF savings plan
for IE00B60SX394
2,882 0.12% p.a. Distributing Sampling 22.15% ETF savings plan
for IE00BK1PV551
11,492 0.19% p.a. Accumulating Sampling 22.07% ETF savings plan
for IE00BJ0KDQ92
4,068 0.45% p.a. Accumulating Swap-based 21.99% ETF savings plan
for LU0274208692
1,213 0.30% p.a. Distributing Full replication 21.77% ETF savings plan
for LU0340285161
72,734 0.20% p.a. Accumulating Sampling 22.07% ETF savings plan
for IE00B4L5Y983
8,940 0.15% p.a. Distributing Sampling 22.15% ETF savings plan
for IE00B4X9L533
6,744 0.50% p.a. Distributing Sampling 21.77% ETF savings plan
for IE00B0M62Q58
4,469 0.20% p.a. Distributing Swap-based 22.22% ETF savings plan
for LU2572257124
5,284 0.12% p.a. Accumulating Full replication 21.99% ETF savings plan
for LU1781541179
820 0.12% p.a. Distributing Full replication 22.14% ETF savings plan
for IE000CNSFAR2
62 0.38% p.a. Accumulating Swap-based 21.84% ETF savings plan
for LU1681043672
1,670 0.12% p.a. Accumulating Full replication - ETF savings plan
for IE000BI8OT95
Source:; As of 15.07.24
Global ETFs in overview
What is the difference between these indices?
Source: justETF Research; Stand: 31.03.2023
With the MSCI World, you invest in 23 industrialized countries. That's not enough for you? Your alternatives: 

Option 2: Discover the justETF Investment Guides

You want to dig even further? Our justETF Investment Guides show you available ETFs for indices, topics, sectors and countries at one glance. 

Option 3: Search & filter

Our justETF search supports you with numerous filter functions – also available as a free app. You can also find more pre-filtered categories like these in our ETF topic list.

5. Order your ETFs or: Now it's time to buy!

Have you selected ETF(s) and noted the ISIN? This is the basis for being able to buy ETFs as soon as your securities account is opened.
Here's how
  1. Log in to your broker
  2. Search for the desired ETF using the ISIN
  3. Enter the number of units, i.e. how many ETFs you would like to buy
  4. Complete all other details if required
  5. Confirm your order
  6. That's it! 

To continue

Stay up to date
Free English newsletter including the latest news & knowledge about investing in ETFs.
Subscribe now
Read more


Which ETFs are recommended for beginners?

Many new ETF enthusiasts often seek guidance on selecting the most suitable ETFs as they embark on building their asset portfolio. One of the widely recognized indices for ETFs is the MSCI World, encompassing approximately 1,500 stocks from 23 developed countries and tracking approximately 85% of the market capitalization of these nations. An MSCI World ETF serves as a solid starting point for those initiating an ETF savings plan.
However, there are alternative options that provide even broader diversification. Since the MSCI World excludes 24 emerging markets, opting for a globally diversified ETF based on indices such as MSCI ACWI or FTSE All World may be beneficial. These indices include up to 4,000 companies, covering around 85% of global market capitalization.
Taking it a step further, MSCI ACWI IMI tracks around 99% of global market capitalization, featuring over 9,000 companies. Unlike MSCI ACWI, the index with the "IMI" suffix invests not only in large and mid caps but also in small caps, i.e., smaller stock corporations. ETFs based on this index represent the most broadly diversified equity index globally. However, to manage the complexity and cost, ETF providers generally employ an optimized sampling process, purchasing a representative subset of the shares in the index to replicate its performance.
Regardless of the chosen index, investing in globally diversified equity ETFs is a prudent approach to wealth building and risk diversification.

How much per month should you invest in ETFs ?

There isn't a fixed guideline on the ideal monthly investment amount in an ETF. The appropriate savings rate varies based on factors such as disposable income and monthly financial obligations.
Historically, the average ETF savings rate (in this case in Germany) has ranged between 140 and 190 euros per month. However, following a peak at the start of 2022, the savings rate dipped back towards the 140-euro mark due to increased inflation.
As a general guideline, it is recommended to maintain a savings rate of 10 to 20 percent for long-term wealth accumulation and retirement planning. The potential for substantial wealth creation from modest initial savings contributions is noteworthy. Explore our ETF savings plan calculator to determine the potential savings from a monthly investment of, for instance, 200 euros in an ETF.

Which ETFs to consider for 2024?

The choice of ETFs for investment in 2024 remains consistent throughout the calendar year. ETF investments are ideally viewed as long-term commitments lasting for years and even decades, with the potential for impressive results through the compounding effect over time.
A key principle in selecting an ETF is to prioritize those that offer broad diversification, boast a substantial historical performance record, and maintain a sizable fund volume. This ensures a prudent approach to long-term investment goals.

How many ETFs for beginners?

For beginners, starting with a single ETF is entirely sufficient. Even with just one ETF, you can achieve diversified investments globally, gaining exposure to thousands of companies in a single investment. This approach effectively spreads risk and enhances the likelihood of realizing a positive long-term return. In our article How to get a globally diversified portfolio with just one ETF we provide detailed guidance on this approach.