How to invest in the ASX 200
The simple guide to get you trading the ASX ASAP.
Key takeaways
- Investing in the ASX 200 is best done via an ETF to avoid buying 200 individual stocks for over $100,000.
- To minimise costs, pick platforms offering $0 brokerage for ETFs and funds with management fees around 0.04%.
- ASX 200 offers robust dividends and franking credits, but diversifying beyond Australian shares is important.
The S&P/ASX 200 is an index of the 200 biggest companies on the Australian Securities Exchange (ASX).
It's the leading Australian stock index and the local equivalent of US stock indices like the S&P 500 and Nasdaq 100, making it a popular choice with local investors.
What's the best way to invest in the ASX 200?
Like any market index, the best way to invest in the ASX 200 is buying an exchange-traded fund (ETF) that specifically tracks the performance of the ASX 200.
If you're ready to invest now, you can jump to our step-by-step guide to investing in an ASX 200 ETF, or you can read on for more information on ETFs.
An ETF is simply a fund that invests in all the companies that make up a certain index (in this case the ASX 200), making it much easier and more cost-effective for investors looking to get exposure to those companies.
ASX 200 ETFs
There are quite a few ETFs that track the ASX 200 or a similar top-200 Australian index, but these are some of the most popular, based on total assets under management (AUM) as at October 2026:
- Betashares Australia 200 ETF
- iShares Core S&P/ASX 200 ETF
- SPDR S&P/ASX 200 Fund
- Betashares FTSE RAFI Australia 200 ETF
Of course, you could also just buy each of the 200 individual stocks that make up the ASX 200 index, but that would be pretty foolish.
The ASX says you can invest in shares with as little as $500 (plus brokerage), which is the minimum value of a 'marketable parcel' under the ASX Operating Rules. Brokers set their own minimums, so check yours before you buy.
If you wanted to invest in the entire ASX 200 index manually with $500 in each company, you'd need to spend around $100,000 (plus trading fees).
Or you could just buy an ETF and save yourself the additional time and money.
How to buy an ASX 200 ETF
To invest in an ASX 200 ETF, you'll need to sign up with a trading platform.
You could either go with a full-service broker like Morgan Stanley, or you can use an online share trading platform for about a tenth of the price. You can compare popular trading platforms below.
While a professional broker can help actively manage your portfolio, if you're only looking to invest in an ETF, it might be simpler and more cost-effective to do so yourself through a trading platform.
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How we picked these
Finder survey: How long have people been investing for (outside of super)?
| Response | Female | Male |
|---|---|---|
| I have never invested | 43.95% | 26.35% |
| Over 20 yrs | 6.97% | 19.11% |
| Between 10-20 yrs | 7.3% | 10.2% |
| Between 5-10 yrs | 6.63% | 9.09% |
| Between 2-3 yrs | 8.29% | 7.24% |
| I am not invested anymore | 5.47% | 7.05% |
| Between 1-2 yrs | 6.8% | 6.12% |
| Between 3-4 yrs | 5.31% | 6.49% |
| Between 4-5 yrs | 4.15% | 6.12% |
| Less than a year | 5.14% | 2.23% |
Source: Finder survey by Pure Profile of 1145 Australians, December 2023
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.
Follow these steps to invest in the ASX 200:
1. Compare trading platforms
As you'll be buying an Australian ETF, you'll want to look for a platform that offers low brokerage fees on ASX trades. As at October 2026, Betashares Direct and Webull charge $0 brokerage on ASX-listed ETF trades. CMC Invest charges $0 brokerage only on your first buy order under $1,000 in each security per day (other trades attract brokerage), and Vanguard Personal Investor charges $0 brokerage only when you buy Vanguard's own ETFs ($9 on sells).
2. Create an account
Once you've picked a trading app, you'll need to sign up for an account by providing some personal information and verifying your identity.
3. Fund your account
After you've been verified, you can deposit funds into your account by bank transfer.
4. Find the ETF you want to buy
Once your account has been funded, navigate to the trading section and search for the ASX 200 ETF you want to buy. Again, you're looking here for the ASX 200 ETF with the lowest fees. As at October 2026, the Betashares Australia 200 ETF (A200) charges management fees and costs of 0.04% p.a., which Betashares says makes it the world's lowest-cost Australia 200 ETF. The iShares Core S&P/ASX 200 ETF (IOZ) and SPDR S&P/ASX 200 Fund (STW) both charge 0.05% p.a.
5. Buy the ETF
Once you've found the ETF, select how much you want to buy, review the transaction and then hit "Buy" to complete the trade.
What companies make up the ASX 200?
The ASX 200 is a who's who of huge Australian companies. Think big banks like the Commonwealth Bank and Westpac, as well as mining giants like BHP and Rio Tinto.
In fact, the ASX 200 represents around 80% of the value of the entire Australian equity market. Standard and Poor's rebalances the ASX 200 every quarter based on the performance of the companies that make up the index.
Is the ASX 200 a good investment?
The ASX 200 has delivered positive returns over the last 5 years, and its total return (including dividends) is stronger than price changes alone suggest.
Australian shares tend to pay higher yields than many international markets, and dividends – especially when reinvested – are an important component of long-term performance. Dividends can make a significant contribution to total return, compared to looking at price increases only.
When comparing with US markets like the Nasdaq 100, it's a good idea to use total return data rather than price-only figures, as most long-term data shows US tech-heavy indices outperform broad Australian equities over extended periods.
Over the past 5 years, the ASX 200 has delivered a solid total return once dividends are included, although the Nasdaq-100 has returned considerably more over the same period. This highlights why Australian shares can look underwhelming on price alone, but still perform reasonably well once dividends are factored in, even if US tech has clearly led this cycle.
Investing in an index like the ASX 200 means backing the broader economy and accepting that annual performance will fluctuate, but over long horizons, there's a historical tendency for growth. Always check whether quoted returns include dividends and consider seeking independent financial advice tailored to your financial situation.
Expert insight: Dividends versus diversification
"One of the biggest benefits of investing in the ASX is that many Australian companies pay dividends. Dividends are payments made by the company to its shareholders in the form of income. Now, the additional benefit to this is that some companies also provide franking credits. These credits have a rebate attached to them, that consists of the amount of tax that was already paid by the company. Ultimately, these franking credits have the potential to offer significant tax savings to investors. This is something unique to Australia, which is why the ASX can be a consideration for investors when building their investing portfolio. However, investing just in the ASX means that a portfolio is limited to just Australian companies, in which case it may be worth talking to a financial advisor to tailor your investing needs based on your risk tolerance, timeline and to ensure that you have ample diversification."
Trading the ASX 200
It's easy to get confused around trading and investing terms as the two can be fairly interchangeable.
However, when it comes to stock market indices it's an important distinction.
Investing in the ASX 200 typically refers to an index fund, which is a relatively safe way to invest. But you can also trade stock market indices through leveraged CFDs which are much riskier.
When you trade CFD indices, you're betting on the price movements of the index. This means you have the potential to earn a profit whether the index is rising or falling.
This makes it a popular tool for traders. It's considered a high-risk product because both profits and losses are amplified through leverage.
With an index fund investment or even shares, you never lose more than you invested. CFDs are different: leverage means you can lose your whole deposit quickly. Under ASIC's CFD product intervention order, retail clients have negative balance protection, so they can't lose more than the money in their CFD trading account, but wholesale and professional clients aren't covered by this protection and could lose more than they deposit.
To find out more about index funds, check out our comprehensive guide.
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