Could anyone let me know how ETF works? What do I need to know or take note of before starting on investing in ETF? Which ETFs are the most recommended ones?

Etf is a basket of passively management fund which can be traded in the stock market. Our sti etf consist of the 30 largest companies in singapore. By buying into the sti etf, you will be diversifying into the different companies.

Excellent idea of You considering ETFs.

They are a cheap and safe collective investing instruments. You could learn a lot and screen ETFs by reading 'anything' and use the ETF screeners on the excellent websites www.etf.com and www.justetf.com, and on zlibrary you could enter 'ETF' to find free downloadable books.

The original (excellent) idea of ETFs was passive indexing, following only the major stock indices. Currently given the strain on mutual fund companies their managers try to dilute the original passive investing idea by adding no so beautiful and expensive/risky/potentially underperforming features as: leveraged, inverse, active, smart etc.

Better stick to the large, cheap and purely passive ones. ETFs issued by Asian financial companies are still more expensive, those of U.S. and Europe (particularly Ireland based ones, their ISIN identifier code starts with 'IE') have much lower annual fees (these should possibly always be lower than 0.30% per year. You find everything in the ETFs 'fact sheet' pdf online.

Avoid mutual funds (unit trusts), instead think passive ETFs.

A decent start could, just f. ex., be tickers VT, or VOO. Don't forget to invest only super-longterm, don't trade (buy & sell often), just Buy&Hold (almost forever).

more on my thinking:

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