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Guides

ETF basics

What ETFs are, how they work, what they cost and what can go wrong. Start here if the word “ETF” is new to you.

Start with What is an ETF?, the guide the rest of this section builds on, then see the shares inside your ETFs.

The guides run in a rough order: what an ETF is and how its price stays honest, then what one costs, whether it is safe, how physical and synthetic funds track an index, where the dividends go, and how to read a factsheet. Bond ETFs, the glossary and the rules on US-listed funds sit at the end, for when you need them. What this section leaves out is which fund to buy. That depends on you, and the Getting started guides and the tools are where that thinking happens.

Guides

  • ETF basics

Sector ETFs and how each sector is doing

A sector ETF holds one slice of the stock market, such as energy or technology. See how the main sectors have done in pounds, which way each one is trending, and why last year's leader is rarely next year's.
  • Last reviewed 20 October 2026
  • ETF basics

What is an ETF? A plain-English guide for UK investors

One purchase, many companies. How ETFs work, what they cost, what can go wrong and how to buy one.
  • Last reviewed 14 October 2026
  • ETF basics

What does an ETF really cost? The fees you see and the ones you don’t

A big index ETF usually charges a fraction of 1% a year. That's only one of the costs. Here's the full list, with real charges as examples.
  • Last reviewed 14 October 2026
  • ETF basics

Are ETFs safe? What happens if the provider or platform goes bust

Your ETF's investments are ring-fenced in more than one way. Here's what protects them, where the gaps are, and the one risk no rule removes.
  • Last reviewed 14 October 2026
  • ETF basics

ETF vs index fund vs investment trust: how they really differ

All three put your money into many investments at once. The differences are in how they're priced, how you buy them, what tax you pay and how much risk the structure adds.
  • Last reviewed 14 October 2026
  • ETF basics

Accumulating vs distributing ETFs: where your dividends go

Many ETFs come in two versions that own the same investments. The difference is what happens to the dividends, and outside an ISA that changes how you're taxed.
  • Last reviewed 14 October 2026
  • ETF basics

Global, FTSE 100 or S&P 500? How index choice works

Choosing an index ETF mostly means choosing an index. Here's what's inside three common choices, and the trade-offs each one brings.
  • Last reviewed 14 October 2026
  • ETF basics

Why can’t I buy US ETFs in the UK? The rules, what’s changing and the alternatives

Popular American ETFs are missing from UK platforms. Here's the rule behind it, what the FCA's new disclosure regime does and doesn't change, and the tax points if you hold US funds directly.
  • Last reviewed 14 October 2026
  • ETF basics

How ETFs work behind the scenes: why the price stays close to the value

You buy an ETF in seconds on a stock exchange. Behind that sits a system of big trading firms that create and cancel units, quote prices all day and keep the price honest. Here's how it works, and when it strains.
  • Last reviewed 14 October 2026
  • ETF basics

Physical vs synthetic ETFs: how an ETF tracks its index

Some ETFs buy the shares in their index. Others get the index's return through a contract with another firm, such as a bank. Here's how each works and what it means for you.
  • Last reviewed 14 October 2026
  • ETF basics

How to read an ETF factsheet: a line-by-line walk-through

Every ETF publishes a factsheet and a key information document. Here's what each line means, using one large global index ETF as a worked example.
  • Last reviewed 14 October 2026
  • ETF basics

Bond ETFs for beginners: gilts, yield, duration and what went wrong in 2022

Bonds are meant to be the calm part of investing. Usually they are. Here's how bond ETFs work, why their prices move with interest rates, and why 2022 caught so many people out.
  • Last reviewed 14 October 2026
  • ETF basics

ETF glossary: the jargon, in plain English

Fund documents and platforms are full of shorthand. Here are 58 terms you'll meet on this site and on ETF factsheets, each in a sentence or two.
  • Last reviewed 14 October 2026

Coming next

New guides arrive every week. These are next in line.

  • Currency-hedged ETFs: when hedging matters
  • Smart beta and factor ETFs explained
  • Sustainable and ESG ETFs: what the labels mean