A search for the “best investments” in the United States often produces a list of familiar brands. Recognising their names does not explain what you would buy, at what price or for which objective. If you live in Spain, the comparison should also consider the currency you save in and the intermediary’s terms.
Archive stock-market montage. Numbers in the image are not current quotations or a forecast.
Identify the product before choosing a brand
Ask for its full name and documentation. Look beyond the label in an app: write down whether the proposal involves shares in a company, units in a fund or another instrument. If you cannot explain what rights you would receive, that is the first unanswered question.
Keep a folder containing the product information, account terms, charges and the date you checked them. This makes it easier to compare a sales explanation with what you would actually sign up for.
Consider the outcome in euros too
Investor.gov’s international investing guide explains that exchange-rate movements can increase or reduce returns, and currency conversion can involve costs. It addresses US readers, but helps explain that general risk; it does not establish which products a resident of Spain can buy.
Ask which currency the transaction uses, how conversion happens and where its cost appears. Request two scenarios: one where the asset price changes, and another where the exchange rate changes as well. Avoid comparing a dollar result with a euro result as though they were the same measure.
Find documents that let you check claims
The same Investor.gov resource points to company reports and documents available through EDGAR as information sources. Compare the document’s date with the date of the recommendation you received. A shortlist written for 2023 does not establish what is suitable to buy now.
- How much of your existing investment already depends on those companies or that market?
- Which advertising claim have you been able to confirm in a document?
- What would buying, holding and selling cost in your circumstances?
- What would need to change for you to reassess the decision?
What to expect when signing up
The CNMV describes questions about knowledge and experience and, for certain advisory or management services, financial circumstances and objectives. Answer accurately: a questionnaire should not be completed to suggest experience you do not have.
This guide does not recommend securities or predict returns. To think through the amount and timeframe first, see our guide to assessing a small investment.
