If you’re ready to invest in ETFs, the next step is choosing the right one. This checklist explains the key factors investors should review—so you can compare ETFs clearly and make informed, confident decisions that match your goals.
What you’ll learn
In this article, you’ll learn:
• What to look for when selecting an ETF
• How costs and structure work
• The difference between accumulating and distributing ETFs
• How to assess risk
• Where to find essential ETF information
How to choose an ETF
Choosing an ETF means checking a small number of key features to make sure it fits your investment goals, time horizon and comfort with risk.
How do ETFs work?
Most ETFs are designed to track an index. An index represents a specific market or group of investments.
Common examples include:
- S&P 500 – tracks 500 of the largest companies in the US
- MSCI World – tracks companies across developed markets worldwide
- FTSE 100 – tracks 100 of the largest companies on the London Stock Exchange
You cannot invest directly in an index. Instead, ETF providers, such as iShares, create and manage ETFs designed to replicate the performance of an index as closely as possible. This gives you a practical way to invest in that market.
In short: the index sets the direction, and the ETF follows it to replicate the performance of the market.
2. Costs: Understanding TER and other fees
The Total Expense Ratio (TER) measures the annual cost of managing an ETF. These costs are deducted directly from the fund. Additional costs may include order fees from your broker or custody fees (depending on the provider). Even small cost differences can have an impact over time.
3. Accumulating or distributing?
ETFs differ in how they handle income such as dividends or interest.Accumulating ETFs: • Reinvest income automatically • Support long-term growth • Often used by long-term investors Distributing ETFs: • Pay out income regularly • Can provide ongoing cash flow The right choice depends on your investment strategy. In short: accumulating reinvests income, distributing pays it out.
4. Risk and return profile
ETFs are often assigned a risk indicator on a scale from 1 to 7. 1 = lower risk (in principle) 7 = higher risk This is not a forecast, but it helps you understand how much the ETF’s value may fluctuate and whether it suits your risk tolerance.Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed.
5. Trading currency
ETFs can be traded and offered in different currencies, such as Euro, US dollar, British pound. What does the trading currency mean for investors?
For investors, it’s important to know that the trading currency:
• Does not change what the ETF invests in
• Does not determine long-term performance
• Does not impact how you receive your money
6. Identifiers: Ticker and ISIN
ETFs can have similar names but different versions. To make sure you select the correct product, always check:To identify the correct product, use:
• Ticker – a short exchange code
• ISIN – an international identification number Always check these before investing to ensure accuracy.
What do ETF names mean?
ETF names may seem complicated, but they follow a clear structure. You can read them like building blocks:
Example: iShares Core MSCI World UCITS ETF (Acc)
Here’s how the name is made up:
• Provider: iShares = who issues the ETF
• Category: Core = a core investment (broadly diversified, designed for long-term investing)
• Index: MSCI World = the market the ETF tracks (in this case, large companies worldwide)
Frequently asked questions
Key takeaways
• The index shows what the ETF invests in
• Costs can affect long-term returns
• Income structure should match your goals
• Risk levels vary between ETFs
• Identifiers help ensure you select the correct product
Ready to start investing?
Getting started with investing doesn’t have to be complicated. With a clear plan and a long-term perspective, even small steps can make a difference over time. Many investors begin with a few simple steps:
Define your goals
Consider what you want to achieve and how investing fits into your plans.
Open an investment account
You'll need an investing account with an online investment platform, bank or provider.
Choose a suitable investment approach
A diversified portfolio may include equities, bonds and ETFs.
Start investing regularly
Investing gradually over time can help manage market fluctuations.
iShares by BlackRock
iShares unlocks opportunity across markets to meet the evolving needs of investors. With more than twenty years of experience, iShares continues to drive progress for the financial industry. iShares funds are powered by the expert portfolio and risk management of BlackRock.
© 2026 BlackRock, Inc. All rights reserved.
1Source: BlackRock/YouGov, People & Money – The next wave of ETF investors, November 2025
Risk Warnings
Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.
Important information
This document is marketing material and will expire 12 months after its publication.
In the UK and Non-European Economic Area (EEA) countries: this is issued by BlackRock Advisors (UK) Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL, Tel: +44 (0)20 7743 3000. Registered in England and Wales No. 00796793. For your protection, calls are usually recorded. Please refer to the Financial Conduct Authority website for a list of authorised activities conducted by BlackRock.
Any research in this document has been procured and may have been acted on by BlackRock for its own purpose. The results of such research are being made available only incidentally. The views expressed do not constitute investment or any other
advice and are subject to change. They do not necessarily reflect the views of any company in the BlackRock Group or any part thereof and no assurances are made as to their accuracy.
This document is for information purposes only and does not constitute an offer or invitation to anyone to invest in any BlackRock funds and has not been prepared in connection with any such offer.
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