Aditya Birla Sun Life AMC Limited

Investing on the Go: How ETFs Make Investing as Easy as Ordering Pizza

Jul 11, 2023
4 min
4 Rating

Are you still procrastinating your investments despite knowing that your money has a better chance to grow in the market than in your wallet? The most common reason for investing delays is "I don't have time." But what if you can make your investments on the go, just like ordering a pizza on your way home?

Thanks to advancements in technology and the rise of Exchange-Traded Funds (ETFs), investing has become as easy as ordering a pizza. In this blog post, we'll explore how ETFs have revolutionized the investing landscape, allowing anyone to invest on the go with just a few taps on their smartphone.

Ordering the ETF pizza:

ETFs, or exchange-traded funds, are cleverly curated products that combine the benefits of Mutual Funds and Equity. They offer unique features that are attractive to all kinds of investors, from beginners to experts.

So how do you go about ordering a pizza?

One, you select your pizza, your toppings from veggies to jalapenos to olives, depending on your appetite and taste. Two, put your address where you want the pizza delivered. And three, make the payment and track your order. And finally, take the delivery.

Similarly, you can order your ETF pizza. While there are some changes in the selection, the procedure is similar. For an ETF pizza, you log in to your demat account and look for ETFs. You can choose from a list of ETFs depending on your risk appetite and financial goals. There are broad based ETFs Like Nifty 50 ETF, Nifty Next 50 ETF. Then there are sector-specific ETFs such as Healthcare ETFs, Nifty IT ETFs, and bank ETFs. Then there are bond ETFs and also commodity-specific like Gold and Silver ETFs.

Once you have selected one or more ETFs, place your order during trading hours, make the balance available in your account, and track your order. The Demat account will tell you if your order is executed, at what price and the applicable charges.

Selecting the ETFs to invest in

While the other steps are simple, the biggest challenge is selecting the right ETF from the various options. In fact, it is probably a challenge even when ordering pizza.

When selecting a pizza, you read about the ingredients and reviews. You either choose the most recommended or try being adventurous with a new flavour. But with ETFs, it’s better to not go by reviews. Do your own research on the different sectors and commodities, and select what fits best with your financial goals and investment horizon. You can start your investing journey with the Nifty 50 Index ETF, which gives you a flavour of 50 large-cap stocks across different sectors. The Nifty 50 Index is used as a benchmark by most large-cap equity mutual funds.

You can also be adventurous and invest a small portion in a sectoral ETF. If you are bullish on a particular sector, like banks, you can buy a Bank ETF and diversify your investment across the top bank stocks for a minimal amount.
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The ETF way of investing on the go

But while you go adventurous, it is better to have a backup ETF, something you are well-versed and feel comfortable investing in. The best way is to diversify your portfolio across different asset classes like bonds, gold, or large caps that react differently to market cycles.

The age-old favourite investment of India is Gold, and Gold ETF gives you exposure to the price change in 99.9% pure gold. You get the price difference without any making charges or storage costs. Gold ETF can hedge your investments against inflation and balance your equity and debt volatility.

The Nifty 50 ETF and the Nifty 50 Next ETF give your money the potential to grow with the overall equity market. The bond ETFs, on the other hand, help you park your money in the short term and earn a better interest rate offered by government securities and corporate bonds.

Just like you order garlic bread, a beverage, and a sweet dish with the pizza to have a complete meal, bring in at least three asset classes to build a diversified ETF portfolio that can enhance returns and lower risk.

Why invest in ETFs?

ETF gives you the freedom of do-it-yourself investing while on the go. Investing in individual stocks can be risky and expensive. With ETFs, you can invest in tried and tested indices listed on the stock exchange. They follow the passive route of investing while keeping the cost to a minimum. Moreover, ETFs allow you to invest in real-time, diversify your portfolio and get return of its native index.

It's high time you stop, procrastinating and start investing, putting your money to work.

References:

https://www.5paisa.com/blog/how-self-investment-in-stock-market-is-as-easy-as-ordering-a-pizza
https://www.paytmmoney.com/blog/etf-investment-benefits/

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.