Why Automatic ETF Purchases Are a Great Idea

If you’re looking for a way to invest without overthinking, then automatically purchasing ETFs is a great idea. You can set up an account and make your investment purchases happen automatically without worrying about it. Keep reading to learn more about why automatic ETF purchases are a great idea. 

Why should you set up automatic ETF purchasing?

When it comes to investing, there are many options to choose from. One of the most popular investment choices is buying stocks through an exchange-traded fund (ETF). ETFs offer a diversified way to invest in specific sectors or markets, which can be bought and sold just like individual stocks. Questrade automatic ETF purchase program allows you to buy a pre-determined number of shares of an ETF on a pre-determined schedule.

The great thing about this program is that it takes the guesswork out of buying ETFs. You don’t have to worry about when or how much to buy because Questrade takes care of it for you. This can be an excellent idea for investors who are new to the market or those who don’t have the time to research individual stocks and ETFs. The benefits of setting up automatic ETF purchasing include:

  • Automatic purchasing takes the hassle out of buying ETFs.
  • It helps you to stay disciplined with your investing.
  • It can help you to save money on commissions.
  • It makes it easy to rebalance your portfolio.
  • It can help you to stay invested in the market.
  • It can help you to take advantage of dollar-cost averaging.

It’s easy to get started with automatic ETF purchasing.

Automatic ETF purchases can be a great way to invest your money and give you more time to enjoy life. When you set up an automatic purchase plan, your funds will be transferred to the ETF of your choice on a pre-determined schedule. This can take the hassle out of investing and allow you to focus on other things.

Additionally, automatic ETF purchases may lower costs rather than individual stocks or mutual funds. Investing in an ETF exposes you to a basket of securities that track an index rather than picking and choosing individual stocks. This can help reduce your risk since it’s unlikely that every stock in your portfolio will perform well simultaneously. Finally, many brokers offer commission-free ETFs, making starting with this type of investment easy and affordable. 

How can automatic ETF purchasing increase your portfolio diversification?

There is a lot of discussion these days about the benefits of using automatic investment programs for your retirement savings. One of the primary reasons why automatic investing is so popular is because it can provide investors with much-needed diversification.

When you invest in a mutual fund or an ETF, you buy into a collection of different assets pooled together. This gives you exposure to various markets and sectors, which helps reduce your overall risk. If one particular asset class performs poorly, your losses will be minimized if you have also invested in other asset classes.

One of the significant advantages of using ETFs rather than individual stocks. With stocks, you are exposed to the performance of a single company, which could either go up or down depending on the market conditions. But with an ETF, even if one company within the portfolio goes bankrupt, you still have most of your money invested in other companies doing well.

This diversification also applies to international markets. For example, if there is a downturn in Europe or Asia, your portfolio will not be as affected if you have investments spread across multiple continents. This is difficult to achieve if you are only investing in individual stocks.

Automatic ETF purchases are a great idea because they make investing in a diversified portfolio of assets easy. In addition, they can help investors keep their costs down, helping investors achieve their financial goals.