Be sure to dig into the composition of any index fund you buy. Many of them have so much technology stock that they’re both indistinguishable from each-other and also doomed (edit: As was pointed out - yes this is hyperbole. I am neither from the future nor a sacred prophet of a time traveling diety.).

The market does great over time, but anyone in tech can tell you this is an abysmal time to buy in to tech stock.

Any fund that blindly buys big popular companies is going to be shattered by the coming tech bubble bursting.

Look for funds with rules for inclusion. Today’s tech stocks are fraught with fraud may have trouble passing those rules.

Ethical funds exist, but don’t currently go far enough to protect your investment. Smoking is bad, but certain kinds of warmongering are apparently a-ok…

Sector specific funds like energy, or transportation have much lower exposure to the current tech bubble.

First, feel no shame or embarresment for asking your questions. No one is born with this knowledge. We only obtain it by study or asking others. That’s exactly what you’re doing, and its just fine.

Second, while the basics of stocks are mostly the same across the world, each country can have different rules for how to buy, taxation, and added/reduced risks or advantages vs other types of investing available to you in your country. Getting answers from someone that knows the systems in Italy should be your next step before investing any of your money.

but it feels so wrong to put so much money into something with risks attached to it and then ignoring it, is there something else I’m not getting?

The non-obvious answer is: there is no path with zero risk. Even just holding onto your money in cash in your hand, it loses value over time due to inflation. Meaning 1€ coin will buy more today of something than the same coin one year from now as inflation raises prices on what you’d buy. So part of investing is to gain more money while another type is to lose as little or no money as possible. The first path generally has higher risk than the second path, however the first path has generally higher reward than the second path.

As far as I understand An ETF is a group of companies that share a market and by shoving money in there (investing in the found is the right phrase I guess)

The only relationship each of the company’s stocks in an ETF (or mutual fund for that matter) have is that they are chosen to be in a group by the organization (brokerage company) that is selling shares in the ETF. The individual companies actually don’t have a choice to be in or out of an ETF. That choice is made by the brokerage company. That brokerage company will buy individual stocks, put them in a big pile, then sell you a tiny slice of that pile as a share in the ETF. This means you have an easy way to own a tiny piece of lots of companies without having to buy individual shares in each company.

Those ETFs are apparently more secure because they spread your money around multiple companies within multiple fields and I feel like I should invest more in those then in singular companies, is that right?

ETFs generally smooth out some of the volatility (rapid stock price rises and falls) because not all companies in the ETF are successful or failing at the same time. The “more secure” idea may come if you invest in a single company stock, and that company goes bankrupt, you lose 100% of your money. If you invest in an ETF and that same company is only 5% of the stock inside ETF, you only lose 5% of your money. The converse is also true though. If that company doubles its stock price, and you own individual stocks, your money doubles. If the company doubles its stock price and its only only 5% of the stock inside ETF, your money has only gone up by 10%.

I feel like I should invest more in those then in singular companies, is that right?

I generally don’t recommend picking individual stocks. Most people, myself included, pick very poorly or pick at the wrong time to buy or sell vs holding a large index ETF like one that mirrors the USA S&P500 (which includes the 500 largest profitable companies in the USA). I do a very small amount of individual stock picks myself and more often than not I would have been better off putting that money in a S&P500 ETF (which is where most of my money goes).

you should just dump in a single ETF and forget about it for like 10 years,

Generally this is good advice. You wouldn’t want to pick an exotic ETF for this like something that includes only “large office building rentals” (yes such a thing exists). You’d pick something like that USA S&P500 ETF that historically has a steady return over time. The most important component to investing is TIME! This allows the power of compound interest to do the heavy lifting. Example: if a person put 10,000€ in S&P500 ETF the very first year the Euro existed in 1999, and never put another cent in, that person would have 100,491€ today! The money would be 10 times what was put in! That’s the power of time!

1. Live well below your means and save monthly. €300 a month is reasonable.
2. Stocks have a specific split because the stock market used to be done on paper and it would make no sense to handle billions of shares pet transaction, so they made the proportion of each share large. Fractional shares build on this system. Your brokerage has to handle this for you by keeping a portion of shares free for it since the stock market itself can only trade full shares.
3. Just set it and forget about it. Put the money in a global/total ETF with a low fee rate. It’s about the lowest risk thing you can do.

Also I want to say that I don’t really want to buy from “the big ones” like Amazon or Microsoft for a deep personal hatred towards certain megacorps

Some books to look at:

• The Richest Man in Babylon
• A Random Walk Down Wallstreet
• The Index Card

Yes the last two are very US centric. But the basic ideas and instruments are more or less global. Some things might go by different local names but once you recognize to them, you’ll know what they are and how they work.

You should only invest in things you understand!

When you buy a stock you don’t just give said company your money. You actually own a piece of that company. When said company has more money than it needs it could pay out dividends to its shareholders. And then you get your percentage of that total dividend.

How often these payments happen depends on the company and if there is a crisis they will stop completely.

ETFs are basically groupings of things. EG there are ETFs that follow the MSCI World, but theoretically there could be an ETF for “Italian companies that sell green Keyboards” or any other rule/grouping you could think of.

If you buy ETF you buy a share of said ETF. So not any stocks of random companies. The ETF then uses your invested money to invest according to what it specified in its description. When those Investments gain money your share gains value, when they fail your share loses money.

There are 2 types of ETFs: accumulating & distributing. They distinguish what happens with dividends. (& have other implications e.g. with taxes)

I think if you buy less then 1 share you dont actually own a part of the company. Someone owns the share of which you bought the part of and that someone then has to give you your part of the dividend they received from the company.

A few thoughts for you:

• when you buy a stock, you are buying a tiny part of an individual company. When you buy a mutual fund, you are buying into a collection of companies put together by whoever runs the fund. They charge a fee for this service, baked into the cost of the funds, which is disclosed in the fine print but you may not notice if you don’t know where to look. Those are often priced once a day. An ETF is simply a mutual fund that is traded like a stock.

• “Index” funds and ETFs are popular because they are meant to mimic the performance of an index (like the S&P 500), so there are very few investment choices to make - so, their managers can’t charge as high a fee.

• Generally speaking, when you buy a stock or fund you don’t owe any tax on it until you sell, and then you only owe tax on the portion that it increased. (So, if you bought at $100, and sold at $120, you may get a form that said you made $20 in income). But some stocks pay dividends, and some mutual funds buy and sell stocks which result in a “paper gain” for the fund even if you didn’t sell. Be aware of how this all works in your country. (And, in particular, don’t ignore any forms they send you, read it all to find out if it affects your taxes!)

• Bank deposits often have some government guarantee, where if the bank goes under the government will make sure you don’t lose your money. Stocks are not like that. You can buy stock in a company, and see it go bankrupt later. It’s stock might go worthless without you even selling it. That’s another reason why some people stick to mutual funds, though, because it spreads out risk a bit more.

• Stocks are priced strictly by supply and demand. Who is buying, and who is selling? Since you are buying shares in actual companies, it is possible if you understand how to read financial reports to find out which stocks are “cheap” and which are “overpriced”. But, in order for the stock to actually go up, there need to be more people buying, for whatever reason.

I hope this helped. Good luck!

• https://www.bogleheads.org/wiki/Getting_started_for_non-US_investors
• https://www.bogleheads.org/wiki/Bogleheads®_investing_start-up_kit_for_non-US_investors
• https://en.wikipedia.org/wiki/The_Investment_Answer (US-focused, but can largely be applied anywhere)