A lot of you have been asking me to show you how to get started with buying ETFs in Europe, so it was about time for me to address this topic in more detail.
Here are some of the things we’ll be talking about in this article:
- We’ll start by looking at what ETFs are in the first place in case you have no idea and why I consider exchange traded funds to be an important part of my asset allocation.
- Then, you’ll get a look into my brokerage accounts, something that I haven’t shared publicly before.
- I’ll show you exactly how to buy your first ETF on Degiro, in my opinion the most cost-effective way to buy ETFs in Europe right now.
- We’ll also take a look at the difference between distributing and accumulating ETFs, which might be relevant depending on the tax laws in your country and your personal preference.
- And lastly, I’ll try to explain the differences between the two account types that Degiro offers when you sign up, to help you decide.
Update (December 20th, 2021): I updated this review, due to the introduction of Degiro Zero and some small changes to the fee model.
Please remember that none of this is investment advice, just my personal opinion based on my own experience as an investor.
My wife and I currently have close to 60% of our net worth invested in broad, low-cost ETFs compared to around 15% in P2P lending.
Just as a reminder, in case you assumed I was all-in only on P2P lending, simply because it has been the main focus of this blog.
What is an ETF & Why should I care?
ETF stands for exchange traded fund. We’ll be exclusively talking about stock ETFs, tracking large stock market indexes like the MSCI World or FTSE All-World.
These ETFs allow us to passively own a small portion of a large number of single stocks, covering most of the world economy and to participate in the long-term growth of the global market. All with minimal costs and while being able to buy or sell our ETF shares easily and quickly on exchanges.
My ETF Strategy – Keeping it simple
Here is our favorite ETF and the only one my wife and I buy on a regular basis:
The Vanguard FTSE All-World (ISIN: IE00BK5BQT80).
Note: We switched to the accumulating version at the beginning of 2021.
Via a single ETF, we’re able to invest into over 3.600 companies from all over the world. We’re not placing bets by buying single stocks of companies, which could always go bankrupt, costing us our entire investment. Instead, we’re counting on the world economy as a whole growing over time, as it has for the past hundreds of years.
Who knows if Apple and Microsoft will still be as relevant as they are today in a decade or if they’ll be replaced by other, more profitable companies. We also don’t know if the US will continue leading the market or if more and more successful companies we interact with daily will be based in other countries, like China or India.
And if more and more work can be automated by AI or done by machines instead of humans in the future, we want to earn a chunk of that increased profitability as well.
Ultimately, our goal is to get our share of the profits and growth of the world economy as a whole over time. To do that, the easiest, most cost-effective way I’ve found is by buying ETFs.
After all, trying to get better returns than the market is extremely difficult over a long time horizon. A lot of much smarter people than you and I have failed before.
Stock Market Volatility
There is one thing you should know: If you’ve never invested into stocks or ETFs before, you need to understand that prices don’t only go up, they also go down on a regular basis, as the market is volatile.
If you decide to start investing into ETFs, this needs to be a long-term decision. You should have a time horizon of 10 years or more. Based on over a hundred years of stock market history, we’re expecting returns of around 7% per year on our money long-term.
But this doesn’t mean we’re expecting to get exactly 7% per year added to our account balance. To give you a better idea, here is what this actually looked like over the past 14 years on the MSCI All Country World Index, which is very close to the FTSE All-World index I mentioned before:
Since December 31st, 1987, this index averaged 8,47% per year. But this average came with a lot of volatility. For example, in 2008, during the last financial crisis, the index was down 41,85%.
That’s why I’m telling you you need to treat this as a long-term investment, to get the average returns of the market. Don’t buy ETFs if you know that you would freak out and sell if the market drops by 20 or 40%. That’s part of the game and will likely happen again.
Now you might be thinking: “Well in that case, I’ll just wait for the next crash and buy in at a lower price.” That’s called market timing. A lot of people have tried and failed to do this in the past.
As a general rule of thumb, time in the market beats timing the market. Nobody can successfully predict a market decline, so I don’t try to either. I simply invest and if there is a correction, I treat it as a discount to buy more at a cheaper price.
Investing into ETFs for Retirement and to beat Inflation
For my wife and I, ETFs are an important part of our asset allocation and our long-term investments. We’re not planning to touch this part of our portfolio over the next 10-15 years or more. They’re part of our retirement fund for when we get old, as the current pension system in most European countries is clearly unsustainable.
Not only that, but we also consider our ETFs to be a good protection against higher inflation, in case the Euro or other currencies lose value for whatever reason.
In the past, the stock market has been a good hedge in periods of hyperinflation, as was the case in Germany between 1920-1924.
If you want to learn more about ETFs, here are some sources I highly recommend:
Flatex vs. Degiro
Here’s the deal, I’m a tax resident in Austria. We have a very complicated tax system compared to most other countries in Europe when it comes to investment funds like ETFs. That’s the reason why we currently have most of our ETFs with the Austrian broker Flatex, which automatically takes care of the taxation for us.
The downside of my Austrian broker however are the high fees of 5-8€ whenever I want to invest more money right away. Luckily, monthly saving plans are only 1,5€ each.
Meanwhile on Degiro, I could buy my favorite ETF once per month (+ whenever I have over 1.000€ or more to invest), commission-free (make sure you check the exact conditions). Those savings definitely add up over time.
Degiro is one of the best options for European investors to buy ETFs, as they have some of the lowest fees on the market and a total of 200 ETFs can be purchased commission-free (check conditions) every month.
Degiro is a licensed, regulated investment firm, based in the Netherlands. As such, they’re supervised by the Dutch Authority for Financial Markets and the Dutch Central Bank.
Your assets are always held in a separate entity, which is standard practice across investment brokers. That means they’re separate from Degiro and can’t be touched in case they would ever go bankrupt.
Basic vs. Custody Account
When you open an account, Degiro asks you to choose between two account types: Basic and Custody.
I will only look at the main differences between these two accounts, at least from our perspective as ETF investors.
Cost-wise, the two accounts are very similar for our needs.
Both accounts are completely free to open and there are no maintenance fees.
Only after you started investing on Degiro and you have your first ETF on your account, Degiro charges 2,5€ per year as an exchange connectivity fee for every stock exchange you buy or sell your ETFs on. If for example like me, you’re only buying free ETFs via the Euronext Amsterdam exchange, you’ll only pay this 2,5€ fee once per year.
Here is the most notable cost difference between the Basic and Custody account, so that you can decide for yourself which one to choose when you sign up, based on your investment strategy:
- No fees on dividends.
- That means you pay no fees if for example you receive a 50€ dividend from your ETF with a basic account.
- Dividend processing fee of 1€ + 3% of the dividend, but no more than 10% total of the dividend (which matters in case the dividend is small)
- That means you pay 1€ + 1,5€ (3%) = 2,5€ in total on a custody account when you receive a 50€ dividend from your ETF.
Just looking at that, you might assume that choosing a basic account is a no brainer, but…
The main difference between the two Degiro accounts
- Shares you own can be temporarily lent to third parties, if they’re able to provide 104% of the share value as collateral.
- There is no share lending whatsoever with a custody account.
These are Degiro’s measures to minimize any risk related to share lending on basic accounts:
- As I mentioned, the clients assets are always held in a separate entity, so they can’t be touched in case of Degiro going bankrupt.
- Degiro always requires a collateral of at least 104% of the share value before any lending can take place, to minimize risk
- Degiro itself always acts as the counter-party if shares are lent out – that means that if for whatever reason the borrower’s securities are unable to cover the value of the borrowed shares, then Degiro makes up for the difference with its own funds.
Nonetheless, here is the very unlikely worst-case scenario with a basic account, as explained by Degiro:
Damage for a client whose Securities are Lent therefore arises only at the moment when both the borrowing party and DEGIRO are no longer able to meet their obligations (i.e. are bankrupt) and the value of the security has fallen or the value of the Lent Securities has risen. The amount of the damage is limited to the difference in value between the Lent Securities and the security provided by the borrower.
Now, the other question is how likely our specific ETF shares are to be lent out, as I don’t think there’s a lot of demand for borrowing shares for our broad worldwide index funds, compared to single stocks.
But this still means that a basic account carries some counterparty risk, limited to the amount of the difference between the collateral and the current share value, if both the borrower and Degiro were to go bankrupt at the same time.
If you want to completely avoid the possibility of any of your shares being lent out at any time, as you don’t like the idea and you want to eliminate all counterparty risk, choose the custody account when signing up to Degiro.
In the end, the extremely low transaction fees on Degiro in my opinion more than make up for the small dividend fees you would have to pay with a custody account. And if you’re only buying accumulating ETFs, meaning ETFs that don’t pay out dividends and instead reinvest them into the fund right away, then you’re not paying any dividend fees in the first place.
If however, you think the counterparty risk is negligible and extremely unlikely, you prefer dividend paying ETFs and stocks and you want to avoid paying any fees on dividends, choose the basic account on Degiro.
By the way, if you have one of the two account types already and you want to switch to the other one, you’re able to register a new account on Degiro and can then ask them to transfer your shares to the new account.
Update (Dec. 2021): It seems as though Degiro removed the Custody account option for new accounts. I don’t think that’s a big deal, I’m using a basic account as well.
How to buy your first ETF on Degiro
Alright, it’s about time I show you how to buy your first ETF on Degiro.
I’ll use the Vanguard FTSE All-World (ISIN: IE00B3RBWM25) as an example, one of Degiro’s commission-free ETFs.
By the way, sorry about the German text.
1. We’ll start by copying the ETF’s ISIN (IE00B3RBWM25) into the search function:
We want to make sure we’re buying our Vanguard FTSE All-World ETF on the Euronext Amsterdam Exchange (EAM), as that is the exchange that’s mentioned on the commission-free ETF list.
2. Next, we’ll click on the green Buy button
3. Here is where we can place our order, and choose between limit or market order.
- Limit stands for the amount we’re willing to pay for each share of the ETF. After filling that out, we can enter the amount we’re planning to invest under Amount (€). It will then automatically calculate how many entire shares we’re able to buy with that amount, and after the order has been executed, we’ll have 76,74€ left in our example, using the numbers above.
- Market can be a good choice if you just want to buy the shares as quickly as possible, at whatever the current cheapest price is on the market. Once again Degiro only buys entire shares, so you’ll likely have some cash left over on your account.
You can then set the validity of the order to be either until the end of the day or with no timely limit, so that it will be executed whenever it either hit’s the price you set (limit order) or when the market opens again (market order).
4. As a last step, you need to click on Place Order and confirm the details of the order in the next window. That’s it!
I also recorded a new video guide recently, you can see it here.
Distributing vs. Accumulating ETF – Some things to consider
Now that you know how easy it is to open a brokerage account and to buy an ETF, we need to talk about a less exciting topic for a moment, taxes.
Unlike in Austria, in most countries in Europe the taxation regarding ETFs is pretty straight-forward. You pay taxes on potential profits when selling ETF shares as well as on dividends you receive.
In that case, it could be advantageous to invest into a reinvesting (accumulating) ETF, which automatically reinvests all the dividends into the fund (ETF) instead of paying them out to you. That way you could let your investments grow tax-free for a long time and you’re only paying taxes on profits when you’re actually planning on selling some of them, for example to cover your retirement expenses.
Just please make sure you do your own research on the topic so you know what tax laws apply to your own specific country.
While distributing ETFs may be less tax-efficient, it’s nice to have dividends coming in on a quarterly basis. Seeing that cashflow increase over time can be motivating to keep investing and to stay invested, no matter whether the market is up or down at the moment. I think this could be a powerful psychological factor for many investors.
Hopefully I was able to provide you with a bit more insights on what ETFs are, why they are an important part of our asset allocation and gave you an idea on how you can get started with diversifying your portfolio by adding ETFs.
I’m really enjoying the ability to buy my favorite ETF, the Vanguard FTSE All-World commission-free on Degiro. I can do that once per month plus whenever I want to invest 1.000€ or more (the exact conditions for more details).
Those savings certainly add up over time, especially when you compare them to what most other European brokers charge for orders.
Before you take off, I’d love to know in the comments if you own any ETFs as well, or if you’re completely new to ETF investing.
Also, make sure you check out my newest article and guide: ETF Investing for Europeans in 2022.
Visual Summary (Sketchnote)
After I published the video, my beautiful wife Zsófia was so kind to create a sketchnote to summarize the content. You might find it useful:
Video of the article (Outdated)
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A list containing all my investments in P2P Lending, the brokerage accounts I use to buy ETFs, my speculative investments in Bitcoin and my free bank accounts. It even includes the tools I use for blogging and YouTube.
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Disclaimer: Investing involves risks of losses. You should always do your own research before investing into anything. Also, some of the links are affiliate links, which help support me, the website & YouTube channel. I only link to services I use myself, none of them are sponsored.
Nice article Angelo, with all the essentials.
I just passed it to a friend, as it will save me having to answer all his questions 🙂
Just for interest, I decided to go for the Degiro Custody accounts in EUR and GBP (unfortunately I needed two accounts to do this).
I created a portfolio with periodic investments in the “bigger picture”, like you ; however, at the time I started, I preferred HSBC MSCI World UCITS ETF (EUR) WRD (IE00B4X9L533). I added other specific sectors in which I was reasonably confident (healthcare, clean energy, cyber security, robotics, gold, Gilts, etc).
Thank you Colin! I think your HSBC MSCI World ETF is a great choice as well.
Nothing wrong with investing in specific sectors, especially if that’s something you enjoy and are confident in. It would be interesting for you to compare the performance to the market as a whole after a couple of years.
Thank you for sharing Colin!
Indeed, Angelo. Over a few years, I have seen the vanilla-flavoured all-share EFTs outperform many targeted EFTs, managed funds and “boy racer” funds that post huge gains one year and lose the lot in subsequent years.
Hi Angelo, it was a pleasure to read this post, congratulations!
About 2/3 or more of the information I already knew and other I forgot with time, specially the differences between DeGiro account types. I invest in iShares MSCI World EUR Hedged UCITS ETF (Acc) IE00B441G979. Though in the long run it may not be relevant, I try to hedge against the USD and that is why I chose this version instead of pure “USD”, though TER/OCF is higher (0.55%). One thing regarding taxes in the topic of accumulating vs distributing ETF:
Some time ago when looking at this, I found myself a little lost about the topic since it’s fairly complex, since there were things to consider such as where the fund is locatde/registered and the it’s base currency. In addition, I heard that Vanguard, at least in the USA, does some kind of superior tax management that saves money to the ETF.
In the end, both Vanguard and iShares ETFs are based in Ireland, so maybe no difference there. But it am not sure how much tax you are REALLY paying in a distributing fund since the value of the dividend is taxed before it reaches your DeGiro acccount, on which of course you will pay the tax relevant to your country. So, basically, I think your being double taxed, whereas in ACC ETF you would not suffer that problem,and hence it optimizes your income.
So, in the end, double taxation and internal ETF tax optimization are issues to consider, though the latter is harder to find info on.
Thank you Orlando! With hedging you’re placing a bet that the Euro will perform better than other currencies in the index (USD, JPY, GBP) and paying a yearly fee for it. Who knows, that may very well turn out to be the case – Personally, I have less trust in the Euro vs. the USD long-term for example. But since most of my assets are in €, I still hope we’ll see a strong Euro!
Ireland is a great domicile for ETFs because they have a favorable tax treaty with the US (15% tax on US dividends vs. 30% in many other European countries). Those taxes are already accounted for in the ETFs price. Other than that, there is no withholding tax in Ireland directly. As far as I know, there is no difference regarding this with an accumulating ETF, since the ETF itself still receives dividends from the companies in it, and has to tax US dividends at the source (the US), before reinvesting (accumulating) them into the fund. The advantage with an accumulating ETF is that you avoid paying taxes on dividends paid out by the ETF to you (in most countries), since it doesn’t distribute them.
You can easily see this by visiting justetf.com and comparing the performance of a dividend paying and an accumulating ETF (covering the same index, with similar fees) long-term. Here is the xtrackers MSCI WORLD 1C (above, accumulating) vs. 1D (below, distributing) ETF for example. The performance includes the dividends that would have been paid out to investors (before taxes):
Another great article with great info. Just wanted to share something with you and maybe ask for your thoughts regarding the statement:
«After all, trying to get better returns than the market is extremely difficult over a long time horizon. A lot of much smarter people than you and I have failed before.»
I remember seeing this (also) amazing video of the channel of Ben Felix that you recommended:
What do you think?
P.S.: Thank you for all the great content in your blog, you are phenomenal!
First of all, I think it’s awesome that you checked out some of his videos as well, I think he does a great job of explaining a lot of topics related to investing.
Yes, higher exposure to certain factors like size (eg. smaller companies – Small Cap) or Value stocks have led to even better performance over the long run in the past. The problem is, these factors can also have long periods of under-performance (Value has underperformed the market by 1,79%/year over the past 10 years for example). So I would only choose that strategy, if you really believe in the specific factor premium and are planning to stick with it in the long run (20+ years). And even then, there is no guarantee that it will beat the market over the next 10-30 years.
You can compare the annualized performance vs. the MSCI World here:
MSCI World Value Index
MSCI World Small Cap Value
MSCI World Small Cap – this one did better, but still underperformed the market over the past 5 years.
Historically, Small Cap stocks have also crashed harder during difficult economic times, since smaller companies tend to have less reserves, leading to more bankruptcies. Just something to keep in mind.
Nonetheless, you can add a factor ETF to your portfolio if it’s something that interests you, it might provide a bit of diversification and could potentially increase returns in the long run. I would just make sure to keep your ETF portfolio as simple as possible, as too much complexity makes you less likely to stick to an investment strategy.
PS: Thank you for the kind words, you made my day! 🙂
Makes perfect sense!
Thank you! 🙂
Hi Angelo, thanks a lot for your tutorial. I have a question regarding limit order: what value should you put? For example, today the Vanguard has the following values: 74.73 € current market rate, buy 74€, sell 79€.
Very interesting blog, Angelo! I just discovered it and already digging it.
I have a specific question for you and I’m curious about your thoughts on that topic:
What’s the reason why you switched from 2 ETFs (MSCI World + MSCI EM) to 1 ETF (Vanguard FTSE All-World) ?
As far as I understood, the Vanguard FTSE only has a 11% share in developing/emerging countries. Is that a problem compared to the very common 70% World/ 30% EM strategy?
thank you Martin, I’m happy to hear that!
Just out of simplicity, that way my portfolio is always fully market-cap weighted without me needing to rebalance and I only need to buy one ETF.
I don’t see that as a problem, more of a personal choice. By over-weighing EM stocks that heavily relative to their market capitalization, you’re simply placing a bet that those will perform better than the rest of the world in the future, which doesn’t necessarily have to pay off (like during the last 15 years, where this mix under-performed).
thanks so much for this article and video. It was very helpful.
In the past I looked into https://etfmatic.com/ which offers a semi-automatic investment into ETFs. I was wondering if you have any experience with it or generally can share your opinion about such platforms?
I played with Roboadvisors in the past. ETFmatic seems to have low fees, so if you just want to set it and forget it and their service is worth the extra fees to you, vs. simply buying ETFs yourself, then I think there is nothing wrong with going that route 🙂
Thanks man, you were very helpful. Keep it up. I am going to check more of your blog.
Dear friend, it depents on you, its difficult for someone to give advice on those questions. Friendly always.
Hi Angelo, thanks for your article, its really insping for more, lets say lower-risk, investments. I started digging your blog last weeks and i really thing i found a treasure here with tools (portfolio performance), articles (how to buy etf’s, p2p platfrorms), videos and so many other gems. I just wanted to say a huge thank you about your time writing and sharing your thoughts and that you are one of my e-mentors.
Hello. Is is possible for you to open a brokerage account in TD Ameritrade or similar US broker so that you don’t pay commissions?
Hi Angle, Thank you for this detailed information. The information you provided here is really useful for a beginner like me to invest in the ETF using Degiro. Keep posting such posts.
Thank you Ravi, very happy to hear that!
Thank you Angelo!
For comparison, with dividend stocks, you can easily find the dividend amount paid quarterly, as well as the dividend yield %.
But how to find these data for a Dividend ETF? In other words, is there an easy way to roughly evaluate how much you will receive as dividend per quarter?
Thanks in advance!
if you check JustETF you can find either look at past dividends your ETF paid to get an approximation for the quarter (although this ‘special’ year a lot might be different) or find the dividend yield (%) in the ETF factsheet.
Hello Angelo, thanks for detailed article. I was following your YouTube and not this blog. This article gives way more details. Great to learn as I was exploring some passive investing. Indeed I started Tradestation International IB account after watching your video. Have you explored and Bond ETFs? Or you dont want to due to expected low returns? Let me know.
hallo Angelo.1) do you think its safe that investor protection ammount at 20000? 2) if you invested 30000 for instance in ETFs and degiro go bankruptcy you lose 10000?
Hi, it all looks ok but one question though. Degiro offers some ETFs in a commision-free manner. But beside them do I get an access to all other ETFs listed on a particular exchange? I mean, justetf.com lists hundrets of ETFs on London Stock Exchange and just a small number of them is on the commision-free list. I would even pay commision to buy several that are not listed.
of course, those are just the ones that can be purchased commission free. The trading fees are very low on Degiro anyway.
Hi Angelo, how do you know which is a Distributing or an Accumulating ETF? Does it show on the platform?
And can you please give a bit more information regarding how with an Accumulating ETF the dividends are automatically reinvested? is that done automatically done via the DeGiro platform?
Hi Tomas! Normally you should get that information via the broker (Degiro, TradeStation/Interactive Brokers etc.) when buying an ETF. To make sure, I would check the ETF’s ISIN or Ticker beforehand using websites like justetf.com.
If the ETF is accumulating, the ETF provider (eg. Vanguard) will reinvest dividends into the fund for you, there is nothing you need to do. And in most countries, it’s the most tax-efficient approach, especially if you would have reinvested your dividends manually anyway.
Hi Angelo, thank you for the article on Degiro trading platform. I am also a resident now in Austria, could you please explain me how exactly you pay taxes on your gains and dividends?
Hi Polina! If you are using a local broker like flatex.at it will care of the taxes for you, if you’re using a broker from another country (eg. Degiro), then you need to use profitweb.at or this link directly and enter the ISIN of your ETF. It will then show you a list with the “Meldungen” and their date. Generally speaking, what matters is the “Jahresmeldung”, where it will show you the relevant tax data for the year. What matters is how many shares of the ETF you held at the exact date of the “Meldung”.
So if at the time of the “Jahresmeldung” on 20.10.2020 you had 200 shares of an ETF, you need to multiply that number with each number you see under “Kennzahlen ESt-Erklärung Privatanleger”, and if it shows USD as “Währung”, covert it from USD to EUR using the exchange rate for that date. You can then enter those numbers (except “Die Anschaffungskosten des Fondsanteils sind zu korrigieren um”, which is for your own accounting and only relevant for when you sell, so it doesn’t get taxed twice) in your “Einkommenssteuererklärung” for 2020.
While I’m not a tax advisor, this should give you a better idea. Sadly they made this topic way too complicated in Austria, it took me a long time to figure this out as well. Here is a German forum with some more discussions about it, which could be helpful.
Hello Angelo! I really love your videos and explanations, thanks a lot ! I`m planning to invest on Vanguard ETF at the beginning of 2021. I`m working and living in Poland but i would like to invest on Vanguard my savings which are in Czech Bank in Czech Republic in CZK currency. Is it possible to open an account in Degiro in CZK? If not, i was thinking to move my money first from my Czech Bank to my Revolut Card in an euro account and then to Degiro Euro Account? Or it would be better to move my money from my Czech Bank to my Revolut card in USD account and then to Degiro USD account? I heard Revolut exchange rates are absolutely the best.
Sorry for the confusion, i really need some advice.
Thanks a lot in advance !
Hi Luca! Thank you, I’m very happy to hear that! I just tried visiting Degiro via a Czech VPN, and it looks like they have a Czech version as well 🙂
If you can deposit in CZK, then I’m sure you can also exchange the money directly on Degiro – from my experience they have excellent exchange fees/rates, but I never tested with CZK. Revolut is a great option as well, I would just compare the rates once you have your account (opening is free anyway). Please let me know what you find out, so that we can share it with other people from the Czech Republic 🙂
I am a Swiss citizen.
I do live in Germany.
My funds are in CHF and I would prefer to buy ETF in CHF so that I do not have to worry about exchange rates.
I might consider buying the following ETF: Strategy of Invesco Nasdaq-100 UCITS ETF CHF Hedged (ISIN IE00BYVTMT69, WKN A2JAN0). This fund does only have marketing distribution rights for Switzerland, Ireland, Italy, Portugal.
How can I find out if I can buy this ETF over DEGIRO and how much it would cost me in fees for buying, selling and holding.
I do not have an account and I would prefer the answers to my questions before I open an account.
Many thanks for your answer.
I just checked, your ETF is available on Degiro.
The trading fees (buying/selling) are 2€ + 0,03%.
Eg. 2,3€ for a 1.000€ trade or 4,5€ for a 5.000€ trade to give you an idea.
Other than that, on Degiro Switzerland you should have no other costs for holding if you use the Swiss stock exchange (SIX) for your ETFs, as your home country exchange is free. Otherwise you pay up to 2,5€/year for each exchange where you buy/sell/hold ETFs.
Since you want to buy an accumulating ETF, I think choosing the Custody account is a no-brainer.
I hope this helps!
Thank you so much for this very very well written and greatly explained Blog.
You are very welcome Samuel!
great content, very practical. I start with the video but I’m glad you have it in a blog post as well.
I’m about to start the 1-ETF approach as well and I’m wondering why Vanguard FTSE All-World (ISIN: IE00B3RBWM25) over other all countries ETFs (MCSI index) like, let say, [iShares MSCI ACWI UCITS ETF (Acc)](https://www.justetf.com/en/etf-profile.html?query=IE00B6R52259&groupField=index&from=search&isin=IE00B6R52259).
Are you looking for higher exposure than the FTSE index brings? “iShares MSCI ACWI UCITS ETF (Acc)” was more expensive when you consider your 1-ETF approach? Any thoughts basically?
I know that when it comes to ETFs everyone have their own preferences but those two have a similar 1-ETF approach and similar TER so I’m wondering if, in your way of thinking, if there is something that points to Vanguard instead of iShares
Greetings from Portugal!
it seems like I missed your comment, so let me apologize for my late reply 😉
The iShares ACWI is a great alternative to the Vanguard FTSE All-World ETF, so if I didn’t have access to Vanguard funds, I would probably go with that one. I still prefer Vanguard though, also based on AUM and the much larger number of companies that the ETF holds (3.527 vs. 1.602).
Greetings from Austria!
no worries. That ends up being my choice as well. All the best!!
thank you Rui, all the best to you as well!
Hello,does Degiro charge for ETFs custofy fee(% of the value of our assets held there per year) like Revolut does.From their pricelist I found this “service fee” only for mutual funds.I sent them an email,asking specifically about ETFs ,but got as a reply only the usual sales pitch, nothing concrete.Since you buy ETFs,I assume you know 🙂
Hi Eva, there are no custody fees or anything similar on Degiro 🙂
What is your opinion-if we buy ETF on a monthly basis for the “buy and hold”strategy,should we put a limit order,or buy at market price.
Recently the prices rose significantly .Should we wait for/if the market calms down a bit,or the price does not matter since we will keep the ETF for years and years
Thanks to your helpful guide I just purchased my first EFT with Degiro. One question that I couldn’t find an answer to anywhere yet: is it possible to make automated purchases monthly in Degiro? I just set up an automated monthly payment from my bank account into my Degiro account, and would love to just automatically purchase the ETF monthly without having to go into the app to do it. The less I have to “handle” my money and the more it’s automated the better for me. Any tips are greatly appreciated.
Hi Maja, I’m happy to hear that you got started with investing! Not as far as I’m aware of. You could just set a specific date and time (eg. first workday each month) to place the order on Degiro, no matter what the price is doing. That way you keep emotions out of it and it would be as close as possible to an automated investment plan.
Thanks for this great blog Angelo.
I found you first in YT and I was interested with ETF. I am learning a lot😀
I have one question that I can’t seem to find an answer. I think i know, but I wanna confirm with you. When I buy an ETF, I can hold it for as long as I want and keep on adding investment (for example every month)and not necessarily sell it?
I am planning to go with Degiro. Also will Degiro will take care of taxes? I am currently living in Spain.
I’m happy to hear that! Yes, you can just buy and hold your ETFs as long as you want (which is what I do). International brokerage firms like Degiro, Interactive Brokers and Trade Republic don’t take care of taxes in Spain for you, you’ll have to do those yourself. But as far as I understand from a quick search online, you only have capital gains taxes and dividend taxes in Spain, so if you’re buying an accumulating ETF (which automatically reinvests dividends for you), you shouldn’t need to pay taxes until you sell some shares (at a profit). Of course I’m not a tax advisor, so make sure to double check yourself.
Really big thanks for your useful videos and blog posts, I really learned a lot thanks to you.
I am using Degiro too and was looking for one piece of info that I can’t seem to find, I was wondering whether you know: I am buying accumulating ETFs but have not yet received any emails or notifications from Degiro informing me about the interest income that was automatically reinvested. Do they send this info or can I check it in my account, or this simply is included in the total balance of the account?
I hope this is not a silly question! Thanks in advance!
Thank you, that’s great to hear!
It’s done within the ETF – the dividend amounts are added to the ETF share’s value as if you were reinvesting them as soon as they arrive yourself throughout the year – Degiro has nothing to do with it.