Investment Types and Accounts for the Stock Market in France

Updated on 28 July 2026

To invest on the stock market in France, four main wrappers coexist: the securities account (CTO), the PEA (a French tax-advantaged equity savings account), life insurance, and the PER (France's retirement savings plan). Each gives access to different investment options (equities, ETFs, bonds, commodities), with its own tax treatment. The right choice depends on your goals, your time horizon and your tax situation.

Key takeaways

• The PEA exempts capital gains from tax after five years of holding, up to a cap of €150,000 in contributions.
• Life insurance becomes tax-efficient after eight years and lets you invest in both euro funds and unit-linked funds.
• The securities account has no cap and no geographic restriction, but its gains are subject to the flat tax (PFU) of 31.4%.
• ETFs replicate an entire index in a single order, a passive approach that often outperforms stock-picking over the long run.
• In 2025, euro funds returned 2.6% on average according to France Assureurs, while protecting the capital invested.

How does the securities account (CTO) work?

The securities account (CTO), or securities account, lets you buy shares anywhere in the world. Through your securities account, you can invest in the CAC 40 by buying FDJ shares, but you can also invest in the United States by buying Apple, Microsoft or Nvidia shares. The securities account also lets you invest in trackers (ETFs) or other financial products such as bonds or investment funds. Note that it also allows you to buy derivatives, instruments that are highly speculative and risky for retail investors.

The securities account has no cap: you can invest as much as you want, without limit. However, it offers no tax advantages, so your gains are taxed either through income tax or through the flat tax of 31.4%.

Comparison table of standard securities accounts:

Why does the PEA optimise the taxation of shares?

The PEA (share savings plan) is subject to tax rules and reserved for French residents. It is limited to one per person and has a contribution cap of €150,000. The assets eligible for the PEA are also limited, mainly to companies headquartered in the European Union. In exchange, after five years of holding a PEA, the investor benefits from an exemption from tax on capital gains.

It is also possible to combine the PEA with a PEA-PME to raise the contribution cap to €225,000, by investing in SMEs headquartered in the European Union.

Lastly, there is also a PEA jeunes (youth PEA), capped at €20,000 in contributions, which lets 18 to 25 year-olds still attached to their parents' tax household benefit from the PEA's tax advantages as soon as they start working.

Comparison table of different PEA accounts:

How does life insurance reduce the taxation of your investments?

Like the PEA, life insurance is an attractive product for growing your savings over time and reducing the tax on the interest generated. Unlike the PEA, however, it is not limited to shares alone. Because life insurance is a multi-vehicle product, it also lets you invest in euro funds to protect the capital invested (the guarantee is provided by the insurer, excluding fees) and limit risk. You can also invest in unit-linked funds (UC) for more dynamism, and therefore higher potential returns, in exchange for a higher level of risk.

The tax advantage of life insurance kicks in eight years after the policy's opening date, regardless of the amounts contributed. It is therefore advisable to open a life insurance policy as early as possible, even with a minimal initial contribution, to benefit from the income tax exemption as soon as possible.

To open a life insurance policy, you need to go through a life insurance broker. You can do this via:

• Your traditional bank
• Your online bank
• A wealth management advisor
• A mutual insurer
• An online broker specialised in life insurance; for example, it is possible to subscribe to a life insurance policy online with Finary

Comparison table of different life insurance policies:

Lower fees
More capital invested

With Finary Life: 0 entry, switching or contribution fees. 0.50% annual management fees on unit-linked funds. Fund-level management fees apply on top and vary depending on the options chosen.

Invest from €300

Non-contractual document for promotional purposes. Investment in unit-linked vehicles carries a risk of capital loss, since their value is subject to fluctuation, both upwards and downwards, depending in particular on developments in the financial markets. The insurer's commitment relates to the number of units, not to their value, which it does not guarantee. This life insurance policy is an individual life insurance policy, denominated in euros and/or unit-linked vehicles, underwritten by Generali Vie, a company governed by the French Insurance Code. Finary SAS, 58 rue de Monceau 75380 Paris 8, Investment Firm authorised by the ACPR under no. 19283, ORIAS no. 21001279, member of AMAFI.

What does the PER offer to prepare for retirement?

Retirement savings were not popular until 2019 and the arrival of the Pacte law. This French law boosted retirement savings by simplifying and harmonising the various schemes that existed until then.

The new PER (retirement savings plan) is now the only retirement savings wrapper available in France. It also allows for a tax deduction, and makes it easier to transfer savings when changing employer or professional situation, as well as from other tax wrappers such as life insurance.

The major new feature introduced by the Pacte law is the possibility to unlock the funds for a new case: buying your main home. This adds to the main advantage of retirement savings, which still lies mainly in the ability to smooth taxation between your working years and retirement. In other words, it lets you pay less tax during your working life and pay more when you retire, balancing the two out.

Good to know : for purely educational purposes, these wrappers can be presented according to their tax logic and time horizon. The actual choice depends on your personal situation and, where relevant, requires the advice of an authorised adviser.

• Open a PEA as early as possible to benefit from the tax advantages on eligible products (European shares or global trackers). Ideally you would place a significant amount if you can, but you can also start small and invest regularly: it is possible to open a PEA with €100, which lets you lock in the start date.
• Diversify with life insurance, best used after the PEA in our view, notably for tax purposes. Life insurance gives access to investments not eligible for the PEA: bond funds, money-market funds, real-estate funds or commodities. As with the PEA, it is possible to open a policy with a small budget, and there is no cap on contributions.
• Complement with a securities account (CTO). Some investors limit the share held in a CTO in favour of the PEA and life insurance to optimise taxation. The securities account gives access to US shares, certificates, or listed real-estate investment companies.

The different financial investments for investing on the stock market

There are several ways to invest on the stock market, in particular through the different wrappers we have just seen. You then need to work out your budget, and define your investment strategy based on your goals, skills and preferences, in order to choose an investment suited to your profile.

Investing in shares

Investing directly in shares means buying the securities of listed companies yourself, without going through a fund: this is what is known as “stock-picking” or active management. In other words, you buy shares of listed companies directly, without going through managed-portfolio services or funds (generally what is offered within life insurance) or trackers. You can therefore buy French shares or US shares directly, choosing whichever stock exchange you prefer. You can choose to buy shares of the most popular companies on the different markets, such as the CAC 40, the NASDAQ, or the S&P 500.

It is the most enjoyable investment approach because it is intellectually engaging, but it is also the most time-consuming and statistically difficult one for beating the market. It is indeed hard to predict a particular company's share price movements unless you have a lot of time to follow its news closely. You will need even more time if you diversify your share portfolio and buy shares in several companies.

By investing directly in shares, you are trying to "beat the market" by investing directly in companies you believe in or have a particular attachment or interest in. Unless you are a seasoned investor, we recommend not allocating your entire portfolio to direct share purchases. Indeed, the figures show that it is difficult to achieve outperformance on shares and therefore to beat the market. Over the long term, investing in a good life insurance policy or in one or more trackers within a PEA delivers better performance than stock-picking.

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Investing in indices via ETFs or trackers

Investing on the stock market via trackers is a good alternative if you feel you do not have enough time for stock-picking. Investing in index funds, particularly through the PEA, is a good way to benefit from the performance of one or more markets over the long term.

Trackers, or ETFs (for Exchange-Traded Funds), replicate the performance of a stock market index, such as the CAC 40 in France or the Dow Jones in the United States, for example. ETFs let you invest in the entire financial market in a single order, which is what is known as the passive management, as opposed to the active management we just covered. This approach lets your investments work on their own, without you having to pay close attention to the activity of one or more companies, since you choose to invest in an index that can replicate the activity of a group of companies in a given geographic area (example of a European ETF: Amundi ETF PEA MSCI Europe), in a particular sector (example of a healthcare-sector ETF: Amundi MSCI World Health Care (ex-Lyxor)), or even worldwide (example of a "world" ETF: Amundi MSCI World).

Passive investing lets you grow your wealth by benefiting from the solid returns of shares without having to constantly watch market movements. As we saw above, share performance is attractive over the long term, and investing in ETFs, particularly through the PEA, turns out to be an excellent way to put your wealth to work without spending too much time on it, while benefiting from the tax advantages of a wrapper such as the PEA.

Investing in commodities

Investing in commodities is not the first thing that comes to mind when you start looking at stock market investing. Yet it is a good way to diversify your investments, in addition to contributing to the basic functioning of the economy, particularly in the energy or agricultural sectors.

Here is a ranking of the most heavily traded commodities:

• Brent crude oil
• Steel
• Soybeans
• Iron ore
• Corn
• Gold
• Copper
• Aluminium
• Silver

You can trade commodities through an online broker (generally the same broker as for your securities account), and you can do so directly by buying the physical asset, or via a contract for difference (CFD). Warning: CFDs are complex, leveraged instruments carrying a high risk of rapid capital loss; according to ESMA, 74% to 89% of retail investor accounts lose money trading CFDs.

Whether you decide to do it directly or via a CFD, your capital gain (or loss) will depend on how the asset's price moves. Be careful, though: unlike investing in shares or bonds, you need to be able to store the assets you invest in. If you cannot do so directly, there are intermediaries able to store them for you, but you will need to deduct the storage cost from your capital gain.

Investing in bonds

Another way to invest on the stock market is bonds, considered less risky than shares, notably because they are less volatile, but also because creditors rank ahead of shareholders in the event of default. Bonds are also a good way to diversify your wealth, notably because the bond market does not behave the same way as other markets during an economic crisis.

To invest in bonds, you can go through the euro fund, via life insurance or the PER. Very accessible and protecting the capital invested (excluding fees), the euro fund is very popular in France, with an average return of 2.6% in 2025 according to France Assureurs, with no guarantee for future years. It is also possible to invest via bond funds, accessible within life insurance through unit-linked funds or in a securities account. Unlike the euro fund, there is a wide range of bond funds with different return/risk profiles.

Depending on the fund you choose, you will have access to different types of bonds. Before investing, we recommend looking at bond ratings from the major rating agencies, Standard & Poor's, Moody's and Fitch Ratings, to fully gauge the risks. You can then choose to invest in highly-rated bonds (between AAA and BBB-), known as Investment Grade (IG) bonds, from companies considered financially solid with a low risk of repayment default, which offer a degree of safety, or you can opt for bonds rated BB+ to C, known as High Yield bonds, which are riskier and therefore better paid.

You can also invest in government bonds, or Treasury bonds, where in practice you are lending money to a state. The coupon payments will then depend on the country's own rating and its ability to meet its debts.

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Good to know : it cannot be said enough, investing on the stock market should be done over the long term. It is important to diversify your investments by making the best use of the various wrappers available to you and taking advantage of the associated tax benefits. A short-term horizon increases exposure to volatility and to the risk of capital loss. Several approaches exist, for educational purposes, depending on your level of knowledge and the time you have available. If you are just starting out and short on time, one option is to favour trackers within life insurance through the managed-portfolio service: you delegate the allocation to the manager, who invests according to your profile. If you have more knowledge and time, passive management can be done via trackers in a PEA, with an ETF allocation chosen according to your convictions, to benefit from compound interest over the long term. You can also diversify through active management via a securities account, by choosing shares of listed companies. Lastly, if the stock market holds no more secrets for you, stock-picking can be considered for the intellectual stimulation it brings. The PEA and the securities account are the wrappers best suited to active management. Always diversify your investments to limit the risk of an overly homogeneous portfolio.

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Frequently asked questions

Which wrapper should you choose to start investing on the stock market?

To get started, the PEA is often recommended: it lets you invest in European shares and ETFs with an exemption from capital gains tax after five years. Life insurance complements it well for diversifying beyond shares. The securities account remains useful for accessing markets outside the European Union.

Can you hold a PEA, a life insurance policy and a securities account at the same time?

Yes, these wrappers can be fully combined and are often complementary. The PEA optimises the taxation of European shares, life insurance covers a wide range of investment options after eight years, and the securities account has neither a cap nor a geographic restriction. Many investors combine all three depending on their goals.

What is the taxation of a standard securities account in 2026?

By default, gains from a securities account have been subject to the flat tax (PFU) of 31.4% since 1 January 2026, made up of 12.8% income tax and 18.6% social contributions. It is also possible to opt for the progressive income tax scale instead.

Are ETFs eligible for the PEA?

Yes, many ETFs are eligible for the PEA, particularly those replicating European equity indices and certain synthetic ETFs offering global exposure. They let you invest in an entire market in a single order while benefiting from the PEA's favourable tax framework after five years.

Does the euro fund really protect your capital?

The euro fund benefits from a capital guarantee provided by the insurer, excluding management fees. Its return varies each year: it stood at 2.6% on average in 2025 according to France Assureurs, with no guarantee for future years. It is the safest investment option within life insurance.

Sources

Service-public.gouv.fr, change in the flat tax (PFU) rate in 2026

Service-public.fr, share savings plan (PEA): cap and how it works

France Assureurs, average euro fund return 2025

ESMA, restriction measures on CFDs for retail investors