Guides

Basics

A share is a small ownership stake in a company. A bond is a loan you give to a company or government in return for interest. An ETF is a fund traded on an exchange that usually tracks an index such as the TA-35. The main local venue is the Tel Aviv Stock Exchange (TASE); through brokers you can also reach foreign markets.

Diversification means spreading money across many assets so one failure does not sink the portfolio. It lowers risk but does not remove it. Many Israelis also save through pension funds, study funds (keren hishtalmut) and provident funds (kupat gemel), which come with their own tax rules.

Costs

• Trading commissions and account fees.
• The spread between the buy and sell price.
• Currency conversion: buying foreign assets with shekels can cost far more than the market rate.
• Fund management fees.

A difference of 1% a year over 20 years noticeably reduces the final amount, so compare total costs, not only the advertised commission.

Taxes in Israel

For Israeli tax residents, gains on securities are generally taxed as capital gains at a basic rate of 25%. Different rules apply to “substantial” shareholders and certain types of income, and an additional surtax may apply at higher income levels. Israeli banks and brokers often withhold tax automatically, but your reporting duties depend on your situation, especially with foreign brokers. New immigrants and returning residents may have time-limited benefits on foreign assets.

Rules change. This is general information, not tax advice: check the Israel Tax Authority or ask a certified accountant.

Checking a firm

• Look up the firm and its licence in the public registers of the Israel Securities Authority (ISA, isa.gov.il).
• Type the website address yourself: copies of real firms’ sites exist.
• Look for ISA warnings about unlicensed firms.
• Binary options have been banned in Israel since 2018. An offer of this kind is a serious warning sign.

Red flags

• Guaranteed or “almost guaranteed” returns.
• A “mentor” or “account manager” who contacts you first on a messenger.
• Pressure: “the offer ends today”.
• Requests to pay in crypto or via obscure payment services.
• Paid private channels with “signals”.
• Trouble withdrawing, or new “fees” to withdraw.

If you have already sent money to a suspicious firm, tell your bank and the police immediately and contact the regulator.

Risk and mindset

• Invest only money you will not need for several years, and keep an emergency fund.
• Leverage magnifies losses as well as gains, up to losing the whole deposit.
• Decisions made in fear or excitement usually make results worse.
• Past performance does not guarantee future results.