ETFs or Exchange Traded Funds are pooled investment funds that tend to track a specific stock market index.
Many popular ETFs track broad-based stock market indexes like the ASX 200 or S&P 500, giving investors the ability to quickly and easily diversify their portfolios across hundreds of companies, in just one trade.
When you buy an ETF that tracks the ASX 200, for example – the iShares Core S&P/ASX 200 ETF or IOZ – you would get the same ‘economic exposure’ as if you bought the the largest 200 ASX companies individually.
By buying an ETF not only would you pay significantly less in brokerage fees but it would also take less time.
Unlike mutual funds, ETFs can be bought and sold on a stock exchange like individual shares.
It’s important to note that ETFs do attract some fees – with the management fee of each ETF clearly displayed on the fund’s product page. The management fee of the iShares Core S&P/ASX 200 ETF is 0.05%.
To discover more about ETF investing check out our Ultimate Guide to ETF Investing in 2023.
This article/webinar is brought to you by Syfe Australia Pty Ltd, AFS representative number 001295306 representing Sanlam Private Wealth Pty Ltd (AFSL 337927). Any information contained here is factual and should not be construed by you as financial product advice. You should consider obtaining independent advice before making any financial decisions. Any reference to an investment’s past or potential performance is not an indication of any specific outcome or profit. We do not intend for any statement made here to relate to the acquisition or disposal of any shares in the companies or other financial products named here.
