The key to a healthy investment strategy lies in diversification. By spreading your holdings across various asset classes, you reduce risk and improve your portfolio's resilience in volatile markets. XTB, with its diverse offerings, empowers you to create a well-rounded portfolio tailored to your financial goals. Here's how you can leverage XTB's platform to achieve effective diversification.
XTB offers over 5,600 instruments to help you build a diversified portfolio, including stocks, ETFs, investment plans and other assets. Let's explore how you can utilise these to your advantage:
Stocks
XTB provides access to a vast selection of individual stocks across multiple exchanges and markets. By carefully selecting stocks from different sectors and regions, you can create a diversified equity portfolio tailored to your risk profile and investment goals. Individual stocks offer the potential for high returns, but also come with inherent company-specific risks. Focus on companies with strong fundamentals and growth potential, considering factors like industry trends, financial health, and competitive advantage. XTB offers 0% commission on Stock and ETF trading equivalent up to 100,000 EUR. Transactions above this limit will be charged a commission of 0.2% (minimum 10 GBP). 0.5% conversion fee may apply.
ETFs
Exchange-traded funds (ETFs) are baskets of securities that track a specific index or sector. They offer instant diversification across asset classes like stocks, bonds, and commodities. XTB boasts a wide range of ETFs, allowing you to gain exposure to entire market segments or specific industries like technology, healthcare, or real estate. Some popular ETFs include the Vanguard Total World Stock Market ETF (VT) for global diversification and the SPDR Portfolio S&P 500 ETF (SPLG) for exposure to large-cap U.S. stocks.
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Investment Plans
If you are interested in long-term, passive investing it’s worth looking into Investment Plans. With an investment plan you have the ability to create and build your own portfolio based on your risk tolerance and preferred sector.
It is possible to run up to 10 Investment Plans simultaneously with all plans being free to run. Investors should note that there is no minimum investment period and you get to decide exactly how long your investments will last. Thanks to the low entry threshold you can start creating your Plans from just 15 GBP minimum investment. The game changer is the fact you don't have to calculate anything, you just set a percentage you would like to be invested in each ETF and we take care of everything else. You can open and close your Plans at any time.
Other Assets
While stocks and ETFs form a strong foundation, diversification goes beyond equities. XTB offers access to other instruments that can help hedge your portfolio against market fluctuations:
Commodities
Investing in commodities like gold, oil, or agricultural products can add a layer of protection against inflation and market downturns. You can access these through CFDs (Contracts for Difference) on XTB's platform. Please note that CFDs carry a high degree of risk.
Forex
The foreign exchange market (forex) allows you to trade currencies. This can be a way to hedge against inflation or diversify geographically. However, forex trading is complex and carries a high degree of risk. Be sure to thoroughly understand forex trading before participating.
Conclusion
XTB doesn't just provide access to markets; it empowers you to make informed investment choices. Utilise our educational resources, including articles under the education section on the website, webinars, and market analysis, to gain a deeper understanding of various asset classes and investment strategies.
By leveraging the full range of investment products offered by XTB, you can create a well-diversified portfolio that aligns with your financial objectives. Remember, diversification is not a guarantee against losses, but it can help manage risk and potentially improve your long-term investment outcomes.
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
