Venturing into the realm of ETF investing for the first time can be daunting. To chart your course through this intricate terrain, it's essential to grasp some of the key factors that influence your investments.1
Before embarking on your investment journey, it’s crucial to recognise your own individual disposition. Are you inclined to embrace risks or do you tend to err on the side of caution? Cognitive biases such as ‘loss aversion’ – where the pain of a loss is felt more acutely than the joy of gain – can lead to poor investment choices.
A recent study by Amundi (Decoding Digital Investments) found that 24% of participants were reluctant to invest due to fear of losses. Being honest about your own habits is often the first step to curbing the effects of individual bias.
The Amundi report also revealed that 23% of investors would likely invest more if they felt more confident in market performance. The reality is that no one can predict which investments will perform best over time.
A diversified portfolio, which includes a mix of investments can help manage these risks, so that when one type of investment underperforms, another may compensate. Exchange-traded funds (ETFs) can offer individuals access to a broad range of investments across multiple asset classes, regions, sectors or themes.2
The longer you invest, the greater the risks you can afford to take, as you have the opportunity to recover from any significant declines in the value of your investments.3 Products like Amundi’s Lifecycle ETF series, can adjust your investment allocation over time to align with your changing approach to risk.
Once you understand your biases and risk appetite, you may find yourself frequently checking your portfolio. This can be counterproductive, especially during market volatility. Understanding market fluctuations can help resist the urge to cash out prematurely. A Global Equity ETF tracking an All-Country index can provide exposure to both emerging and developed markets, allowing for the potential growth of one market to offset the decline of another.
In uncertain times, avoid frequent portfolio changes. Instead, focus on economic indicators like interest rates and inflation, which reflect overall economic health. Interest rates, set by central banks, influence borrowing costs and investment returns. Understanding interest rate trends can help adjust your investment strategy. Fixed income ETFs, such as Amundi Fixed Maturity ETFs, can provide visibility on potential yields in fluctuating environments.
By recognising personal biases and determining acceptable risk levels, investors can make informed decisions. A focus on long-term growth, combined with patience and strategy, can empower you to achieve your investment goals.4
1 Past performance is not a reliable indicator of future performance.
2 Diversification does not guarantee a profit or protect against a loss.
3 Past performance is not a reliable indicator of future performance.
4 Past performance is not a reliable indicator of future performance.
This is a marketing communication. Please consult the Prospectus and the Key Investor Document (“KID”) before making a final investment decision. Past performance is not indicative of future results. This document is of a commercial nature. This is a promotional and non-contractual information which should not be regarded as an investment advice or an investment recommendation, a solicitation of an investment, an offer or a purchase, from Amundi Asset Management (“Amundi”) nor any of its subsidiaries. The Funds are Amundi UCITS ETFs. Amundi ETF designates the ETF business of Amundi. Amundi UCITS ETFs are passively-managed index-tracking funds. The Funds are French, Luxembourg or Irish open ended mutual investment funds respectively approved by the French Autorité des Marchés Financiers, the Luxembourg Commission de Surveillance du Secteur Financier or the Central Bank of Ireland, and authorised for marketing of their units or shares in various European countries (the “Marketing Countries”) pursuant to the article 93 of the 2009/65/EC Directive.
Some information may constitute a general investment recommendation as defined in the article 3. (35) of 596/2014/UE regulation. This material has not been produced with the aim at promoting the independency of financial analysis, and Amundi, as an investment services provider, has no restriction in negotiating any financial instruments described in this material before its issue.
The prospectus in French for French UCITS ETFs, and in English for Luxembourg UCITS ETFs and Irish ETFs, and the KID in French are available free of charge on www.amundi.com or www.amundietf.com. They are also available from the headquarters of Amundi Luxembourg S.A. (as the management company of Amundi Index Solutions and Multi Units Luxembourg), or the headquarters of Amundi Asset Management (as the management company of French FCPs, Multi Units France and Lyxor Index Fund), or at the headquarters of Amundi Ireland Limited (as the management company of Amundi ETF ICAV).
GERMANY
The Funds are German, French, Luxembourg or Irish collective investment schemes respectively approved by the German Bundesanstalt für Finanzdienstleistungsaufsicht, French Autorité des Marchés Financiers, the Luxembourg Commission de Surveillance du Secteur Financier or the Central Bank of Ireland.
For additional information on the Funds, a free prospectus may be requested from Amundi Deutschland GmbH, Arnulfstr. 124-126 80636 Munich, Germany (Tel. +49.89.99.226.0). The regulatory documents of the Funds registered for public distribution in Germany are available free of charge on request, and as printed version, from Marcard, Stein & Co. AG, Ballindamm 36, 20095 Hamburg, Germany.
Risk Disclaimer – There are risks associated with investing. The value of your investment may fall or rise. Losses of the capital invested may occur. Past performance, simulations or forecasts are not a reliable indicator of future performance. We do not provide investment, legal and/or tax advice. Should this website contain information on the capital market, financial instruments and/or other topics relevant to investment, this information is intended solely as a general explanation of the investment services provided by companies in our group. Please also read our risk information and terms of use.
