Cheap investments in stocks with Exchange Traded Funds (ETF)

Savers in private pension schemes are rarely offered the best stock product from their bank, especially if it is just good business for you, but a bad business for your bank.

It is extremely difficult for savers in private pension schemes to get access to share-based products that meet three basic criteria for a reasonable share strategy:

1. Spreading the risk among a number papers
2. Investing in solid companies
3. Low costs 

Besides traditional products, such as pooling arrangements in the bank and pension companies' schemes, it is possible to invest pension funds directly in shares. This makes it possible to get a good spread - like in pools - and lower costs, if you can refrain from trading often. To invest yourself, can be a psychological barrier, but it need not be.

Cheap stocks you are not offered 
As an alternative to pools, private deposits in pension funds and own investments directly in shares, you can choose to buy one or more "Exchange Traded Funds (ETF)", ie a type of funds that are traded on an exchange. Exchange Traded Funds are a part of the international stock market, where cost of investing is typically considerably lower than at the smaller national markets.

Such funds can now also increasingly available through private banks, but your bank will probably hardly offer them to you unless you ask for them, simply because it loses money on it.

Exchange Traded Funds are index funds, that is. they follow such developments on the Indian stock market. If those on average during the year rise 10% so do the EFT, without having to own all the underlying shares.
This makes it easy to invest yourself. The tender of Exchange Traded Funds are large and it can be confusing to decide which funds are most interesting to you.

A good rule of thumb is to select the "boring" funds, if you do not want high risk, for example large funds that invest in large European or global companies. If in doubt you should seek advice.

There are several providers of Exchange Traded Funds. Share-based Exchange Traded Funds are in some countries treated different regarding taxation than investing in non share-based funds.