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I was willing to invest into S&P500 index but cannot find any platform without a huge leverage (for example iqOption, plus500 have leverage of 1:20 which makes usually safe investment become extremely risky (already lost some money because of that)). Are there platforms that allow to invest into S&P500 without leverage?

  • Did you also check out such funds expense ratio? A sounds index fund short term paper value loses means nothing. However, if the expenses ratio is high, even you are making money in the short term, it can cut into your return margin in the long term. IMHO, leverage in investment is anything but gambling: many fund manager can get away with it because it is other people's money. I don't see why you can't invest in any low expense ratio index fund without leverage. If anyone tells you that you must leverage to invest, ignore them. – mootmoot Jul 1 at 9:23
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    why not just invest with any of the dozens of mutual fund companies that have an S&P 500 index fund or ETF? – mhoran_psprep Jul 1 at 10:11
  • @mootmoot I think you misread my question - I am looking for a platform WITHOUT a leverage, not vice versa. – Andrius Naruševičius Jul 1 at 10:48
  • @mhoran_psprep Because I want to mitigate risk by investing into an index with many companies. What is wrong with investing into S&P500? – Andrius Naruševičius Jul 1 at 10:50
  • IMHO, it is very easy to spot non-leverage funds: extremely low expense ratios, e.g. something like VFINX (expense ratio = 0.14% ). It is impossible for any leverage fund to achieve such expense ratio due to the cost of the borrowing. – mootmoot Jul 1 at 11:01
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Member mhoran's comment was an answer.

why not just invest with any of the dozens of mutual fund companies that have an S&P 500 index fund or ETF?

The ETFs are more commonly not leveraged. Of course, some are, so you'll avoid those. But the ticker SPY is the most popular one and it reflects no leverage at all. You get the return of the S&P less a tiny expense. Note, you don't offer a country tag, so we don't know what's available to you.

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    I struggle with terminology, sorry for not understanding at once. I am from Lithuania, a country in north-eastern Europe. What are trading platforms available to me? – Andrius Naruševičius Jul 1 at 12:32
  • Welcome to Money.SE. We welcome people from all over the world, no worries there. This question is tough, because "product and service" recommendations are off-topic. What you need to search for locally is a regular stock broker, one that lets you trade individual shares of stock as well as mutual funds, etc, depending what regulations permit in your country. – JTP - Apologise to Monica Jul 1 at 12:51
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    Andrius, the standard answer is interactivebrokers.com/en/home.php. I have no experience with them, so cannot judge the quality of the service. – RonJohn Jul 1 at 13:25
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    Interactive Brokers offers trading in over 200 countries, including Lithuania. I can't tell you what markets are available in/from each country so if interested, you should contact them for details. – Bob Baerker Jul 1 at 15:36
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I don't think you've been buying index funds

I'm noting what they say on their website:

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

We know that's not an index fund. If I opened 100 accounts at different times and invested them in index funds such as VFINX, VTI, VOO, etc., we can safely say 77 of them would not lose money.

These look like derivatives

... which are a heck of a lot more than merely "leveraged". Specifically CFD -- though the very name of the Web site includes the word "option", so their products are derivatives through and through.

You know of course that volatility is a normal component of investments, and volatility and growth go hand in hand. That makes volatility your friend because growth is your friend. Derivatives are like the mathematical function: they're not about the asset, they're about changes in the asset. Derivatives strip the base value, and focus on the change/volatility. Which makes volatility your enemy.

Derivatives are devilishly difficult to understand.

Also consider the monkey rule: Since the market rises more than it falls, even a monkey picking random investments should win most of the time. So a 77% loss rate is a huge red flag. Something isn't right with these products. It's common for brokers to design unnecessarily complex financial products which are internally rigged to make them a lot of money at your expense.

Any of those violate Harper's Rule: Never buy a financial product you don't understand.

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