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What are ETFs

Diversification through a single transaction

Exchange traded funds (ETFs) are listed managed funds which trade on the Australian Securities Exchange (ASX) – exactly like shares. The underlying assets in an ETF unit are a diversified portfolio of securities which typically track an index. Investors can receive capital growth as the underlying portfolio changes in value as well as income through dividends.

This makes them an ideal way to gain instant access to a diversified portfolio of securities in just one simple transaction – there’s no need to purchase the underlying securities individually.

ETFs are increasing in popularity with investors, making them one of the fastest growing investment instruments with over $1 trillion* invested worldwide.

* Source: ETF Landscape Industry Review 2010, Blackrock

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