ETFs

Firstly, many thanks for your conference yesterday in Sydney, as you said about someone else, nearly didn’t go , so glad I did.

I live in the hunter valley so was a big day , would you mind explaining a little about efts? I notice they’re not cheap to invest in , do they pay a dividend or are they simply hopefully a gain in value stock?

Sorry for my lack of knowledge.

Many thanks.

A: Thanks for the feedback on the conference.

Most ETFs (exchange traded funds) passively track an index such as the S&P/ASX 200. Because the ETF invests in the underlying shares that make up the index, it receives dividends and then passes on the income as a distribution to its unitholders. Typically, distributions from the ETF are paid quarterly.

 

Most of the ETF providers, such as iShares or Vanguard, have detailed information explaining how ETFs operate. See www.ishares.com.au or www.vanguardinvestments.com.au


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