Exchange traded funds (ETFs) are a low cost, tried-and-tested way to grow your wealth.
17% of Australians have invested in ETFs at some point.1
ETFs let you invest in a whole portfolio of stocks, including index funds, or even alternative assets like bonds, property, gold and oil.
How to buy ETFs in Australia (in 5 simple steps)
Ready to buy an ETF? Great, you can follow the quick steps below you get started.
Otherwise, read on for more detailed instructions on how to go about choosing and buying an ETF.
Choose an ETF broker You can compare options in the table below. Look out for competitive fees and how many markets are available to trade.
Create a trading account You'll need to provide personal details and proof of ID when creating an account with your chosen investing platform.
Do your research There's no one-size-fits-all ETF. You'll need to find one that matches your personal goals.
Buy the ETF Search for the name or ticker code of the ETF you want and place a buy order.
Track the performance of your ETF ETFs are long-term investments but it's important to make sure your investments stay aligned to your overall goals.
Step 1: Choose an ETF trading platform
ETFs are traded on the stock market the same way that stocks are, so to access them you'll need to sign up to a share trading platform or investment app.
The first step is to make sure you choose the right platform for your ETF strategy.
For instance, many ETF investors prefer to invest once or twice a year or less into their ETF. So it makes sense to find a platform that doesn't charge any monthly or ongoing fees.
Other investors might want to invest small amounts regularly. In this case, you may prefer to sign up with a platform that charges a low trading (brokerage) fee. Some ETF brokers will charge $0 brokerage fees and instead charge a monthly fee.
Other options include micro-investment or robo-advice platforms such as Raiz Invest or Spaceship. These typically allow you to invest in a portfolio of multiple ETFs based on your risk profile, and you can typically set up an automated investment option where you choose how much and how often you invest.
Ultimately, the lower the fees the better, but it is important to match your platform with your needs.
Avoid ongoing fees. If you're looking to invest a lump sum into an ETF for the long-term, avoid platforms that charges ongoing fees, such as a subscription fee or inactivity fee. In fact, if you're only investing once or twice a year, a higher brokerage fee is actually less important than a subscription fee.
Compare online ETF brokers
ETFs are bought and sold just like regular stocks, so you'll need to sign up with an online broker to start investing in ETFs.
We currently don't have that product, but here are others to consider:
How we picked these
Finder Score for share trading platforms
We've scored over 30 share trading platforms assessing them for their core features, fees, customer experience and accessibility. Our experts give each platform a score out of 10.
Important: The standard brokerage fee displayed is the trade cost for new customers to purchase $1,000 of either Australian or US shares. Where a platform charges different fees for both US and Australian shares we show the lower of the two. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.
Step 2: Create an account
Once you've chosen a trading platform or broker, you'll need to sign up for an account.
It's generally free to sign up and most platforms let you sign up online (or via an app).
However, you'll need to provide some personal information and documentation during the sign up process. This will include:
Your name, address, date of birth and contact details
Your tax file number (TFN)
Proof of ID
Bank account details
The sign up process normally takes a few minutes, but it may take longer for your account to be verified.
Step 3: Do your research
ETFs are a relatively low-risk form of investing, but there's still a lot of variety in the types of ETFs you can invest in, especially in terms of risk and potential returns. According to our data, the best performing ETF over the last 5 years is the Betashares NASDAQ 100 ETF, with an average annual return of 22.68% (last checked 29 July 2024).
ETFs are broken up into 2 broad categories: passive and active.
If you choose to invest in a passive ETF, the managers will seek to replicate the performance of a broader equity market, sector or trend. Think of the ASX 200 or S&P 500 indices. If you take a passive approach, you'll likely just track this market.
On the other hand, some managers will choose to actively invest. The aim here is to increase returns, but it will generally cost you more in management fees and can come with more risks.
Now that you've done the hard work, the next thing to do is actually buying the ETF. You can do so by following these steps:
Fund your account (if you haven't already done so). Make sure you've deposited enough funds to cover the cost of your ETF purchase.
Search for the ETF on your trading platform. You should be able to search using the ETF's name or ticker code. For example, if you wanted to buy the Betashares NASDAQ 100 ETF, you could search for it using the NDQ ticker code.
Select the amount you want to buy. Like stocks, ETFs have a set share price. You can choose to purchase either a set number of ETF shares or a total dollar amount.
Select your order type. You'll normally have the choice of a market order (where you buy at the current price) or a limit order (where you set the price you want to buy at).
Complete the order. Once you've checked your trade, hit "Buy" or "Confirm" to submit your trade.
Still not sure what to invest in?
If you're struggling to pick an ETF to buy, here's a list of the best-performing ETFs over the last 5 years:
Global X FANG+ ETF (FANG)
Betashares Geared Australian Equities Complex ETF (GEAR)
Betashares Geared US Equity Fund Currency Hedged (Hedge Fund) (GGUS)
VanEck Australian Banks ETF (MVB)
SPDR S&P/ASX 200 Financials ex AREIT ETF (OZF)
This list was last checked on 26 July 2025.
Step 5: Track the performance of your ETF
Now that you own an ETF, all that's left is to see how it performs.
ETFs are normally a long-term investment, but you should track your performance of your ETF against the wider market and if you feel like it's underperforming (or no longer matches your investing strategy), don't be afraid to look elsewhere.
Our key tips for tracking your ETF
Patience is key. The normal investing horizon for an ETF is 5+ years. Markets can be volatile, especially over the short term, so give your investment time to grow.
Remember your tax obligations. If you sell your ETF for a profit, you'll likely need to pay capital gains on any return you make.
Expert insight: What are the main benefits of buying an ETF?
"ETFs are a great option for those just getting started with investing as they give investors greater visibility to a number of companies and sectors. The stock market can be very intimidating for those just getting started, but ETFs offer diversification that can otherwise often take a long time to build if investing in individual stocks."
An exchange traded fund is a bundle of shares or options that is listed on a stock exchange that you can purchase through a single trade.
In layman's terms, it is a pooled investment security that typically tracks a market index, a theme, a commodity or other assets. The original ETFs were passive index funds, but over the last decade, the sector has exploded.
An example of an index fund would be the iShares Core S&P/ASX 200 ETF, a market-tracking ETF made up of the 200 biggest companies in Australia. Investors in this ETF own a small percentage of each company based on market weighting. So, larger companies like BHP and Commonwealth Bank make up a larger holding than say a smaller company like Corporate Travel Management.
Each ETF is allocated an ASX code and can be bought and sold by investors the same way that you would buy and sell shares.
The good thing about ETFs is they instantly create a diversified portfolio. By default, you own an entire section of a market, but you can easily add other assets including Australian shares, global shares, fixed income, debt, foreign currencies, commodities and metals.
The main difference between an ETF and a mutual fund is an ETF is listed on an exchange such as the Australian Securities Exchange (ASX).
5:12
0:00 Is it just me or is everybody talking about ETFs? ETFs are one of the most popular investment products of the last decade and there's a very good reason for that.
0:09 Over the last five years, ETFs have returned on average around 7.4% per annum each year and the last year alone, they returned 21% so if you'd invested five thousand bucks in an average ETF, you'd have made a nice $1,000 return while you were sleeping and if you'd invested it in the top-performing ETF of the last five years, you'd have made a massive 41% return on your capital each year
0:34 ETFs make great investing sense but for many of us, they're still somewhat of a mystery. So in this video, I'm going to explain what an ETF is, the kinds of ETF there are out there, how you can invest in them, and how to pick the best one for you.
0:50 What is an ETF? Exchange-traded funds or ETFs are investment funds that have been listed on a stock exchange. This means you can trade them as you would ordinary shares but when you buy shares in a company, say like Apple, you're investing in the stock price of that one company.
1:04 this is a great way to make money, but it can also be pretty risky if the stock price goes down. When you invest in an ETF on the other hand, you're buying shares and multiple companies, sometimes hundreds of them at a time.
1:14 So if shares on Apple go down, you might not lose as much because shares in another company, say like Netflix, could go up and they fall into three main buckets. Most of them track a group of stocks. This is known as an index. These are called index funds. Not all ETFs do this, but most do. And we'll get back to the others in a bit.
1:36 Australia's most well known index is the ASX200, which is a collection of shares of the 200 biggest listed companies in the country. So the price of an ETF that tracks the ASX200 would rise and fall along with that index.
1:50 This is called passive investing. Passive meaning the fund managers don't actually have to do much of anything. They just set up the fund and let it go.
1:58 The second main group of ETFs are known as synthetic ETFs. These don't actually hold any stocks at all, but instead, they track the price of an asset, usually a commodity, for example, gold.
2:09 And finally, there are actively managed ETFs. Actively managed means that there are literally people attempting to assemble what they think will be a winning combination of assets together into a fund trying to beat the market. Typically they don't but that's a video for another day.
2:25 You can use ETFs to invest in just about anything. So say you think that tech companies are going to continue to dominate. Well, there are ETFs for that. And the same goes for ethical stocks or Australian property or infrastructure, consumer goods, and even robotics, which is awesome.
2:42 And you can also invest in regions, like Asia or even specific countries like, say Japan or India, China. And if you care about climate change, there are around 10 ETFs listed on the Australian Securities Exchange that exclude companies directly engaged in fossil fuel production and environmental destruction.
3:00 Choosing the right ETF for you will come down to your personal circumstances. You'll want to ask yourself how much money can you afford to invest in the stock market. Can you risk losing any of it and how long can you have the money locked away for.
3:12 And generally, there are three key points to think about when you're perusing your ETF. Number one is risk. ETFs can range from low risk to high risk. Generally, index fund ETFs that invest in a diverse mix of major Australian or global companies are among the safer options. Whereas synthetic or actively managed ETFs might carry more risk.
3:33 Next step: fees. There are two main fees to think about. First is the brokerage fee, charged every time you buy or sell, and that depends on your broker. And the other is the ETF management fee which is a percentage of your balance that's charged every year as a benchmark. The average ETF fee is around 0.5% per annum.
3:53 Finally, performance. Different funds will perform better over different time frames. Look at how it has performed over the last month or year, but also check its performance over several years. If the fund is relatively new, you can also just check the performance of the index itself which typically backtracks for twenty years.
4:12 Most Aussies who choose to invest in ETFs do so for the long term. In 2019, the ASX200 index returned 23% so a lot of ETFs had similarly high returns. But if the market drops one year, you probably wouldn't see returns that good. And since most ETFs passively track the stock market in various ways, you'd expect that they'd perform similarly minus the fees.
4:34 So say you'd invested in an S&P 500 index ETF prior to the stock market crash of 2008. If you'd removed your funds just after, you'd have lost around 50 percent of your investment. On the other hand, if you could afford to hold on for another six or seven years, you'd be back in the green.
4:50 Long story short, the longer your investment in an ETF, the safer you tend to be. If you've got any questions about investing in ETFs or anything else, drop me a comment below and let us know if there's anything else you'd like us to make a video on.
5:04 You can read more about how to invest in ETFs and how to pick the right online broker for you through the links below. Thanks for watching.
What types of ETFs can you buy?
The humble ETF has evolved from its start as a simple passive investing index. Nowadays, you can get an ETF for pretty much anything ranging from your more traditional passive approach to an active strategy, a thematic strategy and everything in between.
Here are the different ETF types you might want to trade:
Passive ETFs
Also known as indexed ETFs or index funds, these funds aim to replicate the returns of a specific index or benchmark. For example, you may want to invest in a fund that tracks the performance of the S&P/ASX 200 (Australian stock market) or the S&P 500 (US stock market).
Active ETFs
Also referred to as exchange traded managed funds (ETMFs), active ETFs aim to outperform the market or a particular index. These sometimes come with a higher level of risk and usually have higher management fees.
Factor and smart beta ETFs
These combine both active and passive strategies. They typically track an index but factor in additional variables, such as a higher weighting of smaller companies. Smart beta ETFs track non-traditional indices designed to invest in a selection of company stocks based on their own set of rules. The idea is to outperform the market.
Structured and synthetic ETFs
Synthetic ETFs are where things start getting a little bit more complex.
ETFs access investment assets in 2 ways: physically or synthetically. ETF issuers of a physical (or standard) ETF have purchased the underlying assets on the index it aims to replicate.
Structured or synthetic ETFs try to replicate the performance of their underlying assets through the use of derivatives. This is because it's not always practical to hold physical assets. For example, gold or commodity ETFs are often synthetic due to the fact that storing large amounts of gold is often difficult. Instead of investing in an actual lump of gold, you're investing in a contract that promises returns based on the commodity's price movements.
What is a derivative?
Derivatives are products that derive their value from underlying assets like commodities or shares. Instead of purchasing a physical asset, it's a contract with an agreed-upon return based on the price of the movements of the underlying asset. Examples include futures, CFDs or options contracts.
Warning: Because structured products may use complex investment strategies, they can be much riskier than a standard index ETF.
Commodity ETFs, or exchange traded commodities (ETCs), track the performance of an underlying physical commodity, such as gold, natural resources or agricultural products.
What are the costs of investing in ETFs?
When you invest in an ETF, the first cost you'll be aware of is the ETF unit price. However, there are other less obvious costs you need to be aware of. While ETFs typically charge lower fees than unlisted managed funds, this isn't always the case.
You should always read the PDS provided by the ETF issuer for full details of any fees that apply and how they will affect your investments. Here are the main costs to take note of:
Management fees. Just like any other managed fund, ETFs have management fees, which are sometimes referred to as the management expense ratio (MER). This fee is charged by the ETF issuer and is usually included in the unit price.
Brokerage fees. You'll need to pay brokerage fees whenever you buy or sell ETF units. These fees vary depending on the online broker you choose but usually start at around $10 or $20.
The buy/sell spread. This is the difference between the highest price you're willing to pay for an ETF unit and the lowest price at which a seller is happy to sell. The wider the spread, the more it can cost you.
Finder survey: How many ETFs do Australians hold?
Response
1
19.53%
2
17.16%
3
15.38%
5
12.43%
4
10.65%
10
5.33%
6
3.55%
8
3.55%
12
2.37%
7
2.37%
20
1.18%
30
1.18%
9
1.18%
14
0.59%
17
0.59%
19
0.59%
47
0.59%
50
0.59%
65
0.59%
90
0.59%
Source: Finder survey by Pure Profile of 1145 Australians, December 2023
Do ETFs pay dividends?
Some ETFs pay dividends if the underlying company stocks pay dividends. However, it also depends on whether the fund manager chooses to pass this on, so check this first if this is a priority. This information should be available in the ETF's product disclosure statement.
Most of the time, ETFs will pay their dividends on a quarterly basis, though this isn't a rule. If you're interested in ETF dividends, check the yield, how often it's paid and whether you can reinvest the payments back into the ETF if you choose or if it's paid into your account.
Pros and cons of ETFs
Pros
Index fund investing. Index funds have become a popular way to invest relatively safely in the stock market. Most (not all) ETFs are types of index funds.
Diversify your portfolio. Buying units in just 1 ETF allows you to invest in many shares and asset classes at once.
Dividend income. If the underlying assets held by an ETF pay dividends, those dividends and franking credits (if applicable) will be passed on to you.
Relatively inexpensive. Creating a diversified portfolio of shares and other investment options usually requires a lot of money. But if you invest in ETFs, you can get started with as little as a few hundred dollars at a time or less if you use a micro-investing platform such as CommSec Pocket or Raiz.
Easy exit. Unlike some other types of investments that lock you into a contract for a fixed term, ETFs are open-ended meaning they are easy to transact with.
Cons
Losing money. If the underlying assets owned by an ETF don't perform as hoped, the value of an ETF will fall – and the value of ETF units you own will fall along with it.
Tracking errors. As we mentioned above, ETFs don't always exactly mimic the performance of the index they're designed to track, with fees, taxes and other factors potentially resulting in lower-than-expected returns.
Risks associated with individual ETFs. The underlying assets held by your ETF also come with their own risks, depending on what they are tracking.
International taxes. If you buy units in an ETF that is listed in a country other than Australia, you may need to pay foreign taxes. Make sure you're aware of all tax implications of an ETF before you commit any funds.
Expert insight: The potential benefits of ETFs
"The best part about ETFs is that they are a basket of shares. There's no need to stock-pick or guess what the winning company will be. Plus it saves you money on all the brokerage fees you'd be paying if you were picking individual shares. "
Generally speaking, ETFs can be an easy way for beginner investors to start investing. When it comes to ETF trading, they have a few beginner-friendly characteristics, including the following:
You don't have to be hands-on with your investing
If you choose a passive fund, you have diversification in one trade
They take away the problems of portfolio construction
They are low costs
Due to typical lower turnover, they can be tax-efficient
All in all, ETFs can be a simple way to build towards a long-term financial plan. If you're looking for the best ETFs to invest in, click here.
Synthetic ETFs must feature the word “synthetic” in the product name.
The number of ETFs you should invest in will greatly depend on your own diversification strategy and the types of ETFs you buy. Diversification remains one of the most important rules of investing as it helps to reduce risks by ensuring there's no single asset that makes up a large portion of your portfolio. When it comes to buying ETFs and being diversified, if you buy a passive all-world ETF, you'd be capturing a large part of the market and you could be diversified in a single transaction. If, however, you buy more thematic ETFs, you are exposed to a sector or industry. You might be less diversified, meaning you will need to buy ETFs that match a different thematic.
Some online brokers have minimum investments as low as just a few dollars. For example, Totality has a minimum trade amount of $50. However, other brokers charge a minimum investment of the same as shares, which is $500.
No. The number of stocks purchased by an ETF will reflect the importance of each stock to the performance of the index. For example, an ETF would hold more shares in a large company like Rio Tinto or CSL than it would in the smallest companies in the top 200 index.
Yes, many robo-advisors offer access to diversified ETF portfolios. You can find more info in our robo-advisor guide.
Yes, there are ETFs available that track ASX indices and are traded on the ASX.
Yes, you can use a margin loan to fund the purchase of ETF units.
You can purchase as little as 1 share in an ETF.
Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product on the provider's website.
Kylie Purcell is an experienced investments analyst and finance journalist with over a decade of expertise in a wide range of financial products, including online trading platforms, robo-advisors, stocks, ETFs and cryptocurrencies. She is a sought-after commentator and regularly shares her insights on the AFR, Yahoo Finance, The Motley Fool, SBS and News.com.au. Kylie hosts the Investment Finder video series and actively contributes to the investment community as a judge and panellist. She holds a Master of Arts in International Journalism, a Graduate Diploma in Economics, and ASIC-recognised certifications in securities and managed investments.
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I don’t have a clue what to do, can I speak to someone!
Finder
KylieSeptember 10, 2025Finder
Hi Jen, taking the first step is always the hardest! While we don’t currently assist over the phone, you can always talk to a financial advisor. If you’re looking to invest in an ETF, you’ll need to sign up to a share trading platform. Check out our list of beginner apps here: https://www.finder.com.au/share-trading/exchange-traded-funds/best-etf-trading-platforms. Or if you’re not sure which ETF to invest in, you can try a micro-investment app like Raiz or a robo-advisor. These platforms offer ready made investment portfolios, so all you need to do is decide how much to invest and how often.
Good luck!
KathyNovember 1, 2023
which is the best ETF for gold
Finder
KylieNovember 6, 2023Finder
Hi Kathy, we can’t recommend any products however the following ASX-listed ETFs are gold-themed: The VanEck Gold Miners ETF, Betashares Global Gold Miners ETF, Global X Physical Gold, VanEck Gold Bullion ETF, Perth Mint Gold ETF, Betashares Gold Bullion ETF. Which you pick depends on your personal goals and circumstances. Remember that some gold-themed ETFs track gold mining companies and other track the price of gold bullion in either AUD or USD.
AlexanderMay 2, 2023
are there any Australian Vanguard etfs that pay monthly?
Finder
KylieMay 15, 2023Finder
Hi Alexander, I’m not aware of any Vanguard ETFs that pay monthly. Distributions are typically paid once a quarter or once a year. However it’s worth reaching out to Vanguard directly to double check this.
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I don’t have a clue what to do, can I speak to someone!
Hi Jen, taking the first step is always the hardest! While we don’t currently assist over the phone, you can always talk to a financial advisor. If you’re looking to invest in an ETF, you’ll need to sign up to a share trading platform. Check out our list of beginner apps here: https://www.finder.com.au/share-trading/exchange-traded-funds/best-etf-trading-platforms. Or if you’re not sure which ETF to invest in, you can try a micro-investment app like Raiz or a robo-advisor. These platforms offer ready made investment portfolios, so all you need to do is decide how much to invest and how often.
Good luck!
which is the best ETF for gold
Hi Kathy, we can’t recommend any products however the following ASX-listed ETFs are gold-themed: The VanEck Gold Miners ETF, Betashares Global Gold Miners ETF, Global X Physical Gold, VanEck Gold Bullion ETF, Perth Mint Gold ETF, Betashares Gold Bullion ETF. Which you pick depends on your personal goals and circumstances. Remember that some gold-themed ETFs track gold mining companies and other track the price of gold bullion in either AUD or USD.
are there any Australian Vanguard etfs that pay monthly?
Hi Alexander, I’m not aware of any Vanguard ETFs that pay monthly. Distributions are typically paid once a quarter or once a year. However it’s worth reaching out to Vanguard directly to double check this.