Dubai: If you thought ETFs were already flooding the market, 2025 just took it to a whole new level. In just the first four months of the year, 847 new exchange-traded funds (ETFs) were launched globally—a record-breaking number, according to ETFGI, a global ETF research and consultancy firm. Even after accounting for 179 ETF closures, that’s a net increase of 668 new products.
With the US, Asia Pacific (excluding Japan), and Europe leading the charge, the sheer volume of new listings means investors—from beginners to seasoned pros—now have more options than ever. But more isn’t always better.
So what does this ETF surge mean for everyday UAE investors? Is this the right time to start investing in ETFs, or should you tread carefully?
A buffet of choices—but be picky
ETFs are often praised for being cost-effective and easy to access. Think of them like mutual funds that you can buy and sell during market hours, just like a stock. But with over 8,000 ETFs now trading worldwide—and hundreds more being added each year—it’s easy to feel overwhelmed.
If you’re based in the UAE and looking to invest in international markets, ETFs can be a useful tool. They offer exposure to everything from tech-heavy US indices to diversified Asian, European, and even emerging market baskets. There are ETFs tracking sectors like healthcare, commodities like gold, and even niche themes like artificial intelligence or clean energy.
But more choice means more homework. Not every new ETF is worth your money.
How to choose from the crowd
Before jumping into the ETF bandwagon, ask yourself three simple questions:
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Where do you want to invest?
Do you want to focus on US stocks? Global markets? Or perhaps a specific industry like renewable energy or real estate? For example, if you’re worried about too much tech exposure in the popular S&P 500 ETF, you could explore equal-weighted versions or sector-specific ETFs to diversify better. -
What kind of ETF fits your goal?
ETFs come in various types—some track stock indices, others are built around bonds, commodities, or even currencies. Newer ETFs often offer active management, but these may come with higher costs and untested strategies. Stick to simple, well-established index ETFs if you’re just starting out. -
What’s the cost and tax structure?
Many UAE investors prefer UCITS-compliant ETFs listed in Europe because they’re usually more tax-efficient than US-listed ones. Always check the expense ratio—this tells you how much you’re paying annually to hold the ETF. A lower cost generally means higher returns over time.
Why this matters to UAE investors
ETFs have become increasingly accessible to UAE residents via local brokers and international platforms. Whether you’re looking to build a retirement portfolio or put your extra savings to work, ETFs offer a relatively low-cost, flexible way to diversify beyond UAE markets.
And with fractional investing and low minimum amounts, even a few hundred dirhams can get you started. That’s why more expats and Emiratis are exploring ETFs as an alternative to individual stocks or expensive mutual funds.
However, with the influx of new and sometimes experimental ETFs, don’t fall for trendy names or hyped-up themes—especially if they’re not part of your long-term plan. If a new ETF promises big gains in social media or 3D printing stocks, ask yourself: is this core to your portfolio or just a shiny distraction?
How to get started (or refine your strategy)
If you’re planning to start investing now, you don’t have to put in a lump sum all at once. Many UAE investors follow strategies like dollar-cost averaging—investing a fixed amount each month—to reduce timing risk. Another method, value-cost averaging, adjusts the amount you invest based on how your portfolio is performing.
And remember, don’t worry about getting everything perfect from the start. The key is to begin. You can always refine your strategy as you learn more.
Final word?
Yes, ETFs are worth it—but choose wisely..
The record number of ETF launches in early 2025 shows how much investor interest this space is attracting. But more doesn’t always mean better. As a UAE investor, the real value lies in picking ETFs that are cost-efficient, transparent, and aligned with your financial goals.
So, is it worth investing in ETFs now? Yes—if you’re clear about why you’re investing and what you’re buying. Avoid the noise, stick to the basics, and build a portfolio that works for you.