Creating a portfolio
31 October 2021
How to choose an ETF, example 2
31 October 2021
In this third and last example, I will show you, very quickly, how you can choose an ETC, in this case on gold. The characteristics I'm looking for are kind of always the same. I want a liquid ETC, with physical replication, low costs, no foreign exchange issues and that has been on the market for at least 5 years.
In the screener of JustETF, I click on precious metals. This gives me the whole list of ETCs, starting from gold, up to silver and passing by palladium, platinum etc.
I have several ETFs to choose from. So, I click on "Fund Size (in m €)" to arrange them in order of size.
The first, Xetra-Gold is the largest and most traded (so very liquid), in Euro, has no cost (of management, you still have to pay the commissions of the bank or broker), has a physical replica and has been on the market since November 2007.
All this, as in the previous examples, can be found by clicking on the name or going directly to see the characteristics of the ETF on the site of the issuing company.
At this point, choosing an ETF or ETC should seem less complicated to you even if you have to spend some time on it.
You have seen the criteria, explained in theory and then in practice, in the examples. To help you in your choice you can use the JustETF screener (https://www.justetf.com/it/find-etf.html), and, on the left, by selecting the parameters (those available) that interest you, reduce the number of results.
Clicking on each of the results, you can go and read the characteristics (or go and see them directly on the website of the issuing company). You can also download and read the fact sheet and the KIID (in PDF format).
If like me, you have an account with a broker that allows you to buy ETFs, chances are it already comes with a screener. No one is stopping you from using that (or another free screener), however, I have found that JustETF, for a European investor, is very well done.
In this third and last example, I will show you, very quickly, how you can choose an ETC, in this case for gold. The characteristics I’m looking for are kind of always the same you have seen in the previous
I am a macroeconomic and financial analyst with over 30 years’ experience, including two years as a fund manager. I specialise in currencies and commodities, and I am the author of several successful books on trading, macroeconomics, and financial markets.
