Your First Investment: Should You Choose a Single Stock or an ETF?

You’re ready to make your first investment. You've set aside some money, and you're eager to put it to work. But then comes the big question: what do you actually buy? For most beginners, it boils down to two main choices: buying shares in a single company (a stock) or buying a share of a diversified fund (an ETF).

Let's weigh the pros and cons to help you understand which path is right for you, and how Elivo is designed to guide you toward the smartest choice.

The Case for Buying a Single Stock

The Appeal: It's exciting! You get to invest in a company you know and love, like Apple or Nike. If that company soars, you can experience big returns. It feels personal and gives you bragging rights.

The Downside: It's risky. You're putting all your eggs in one basket. If that single company hits a rough patch, your investment can take a major hit. It requires research and a strong belief in that company's long-term success.

The Case for Buying an ETF

The Appeal: It's safe and simple. An ETF (Exchange-Traded Fund) is a basket that holds hundreds or even thousands of stocks. By buying one share of an ETF, you instantly own a small piece of all those companies. It’s the ultimate form of diversification.

The Downside: It's less exciting. You won't get the same thrill of seeing a single stock double in value. Your returns will be closer to the average of the overall market, which means less extreme highs and lows.

The Elivo Approach: Smart from the Start

At Elivo, we're focused on helping you build lasting wealth, not encouraging risky bets. That's why our platform is built around creating and managing diversified portfolios of ETFs for you.

We take the guesswork out of it. We ensure your first investment, and every one after, is part of a smart, diversified strategy. We give you the benefits of owning the whole market without the stress and risk of having to pick individual winners.