Benefits
ETFs & ETCs offer you the opportunity to invest in an index or a commodity through an issuer. Trading ETFs with CommSec offers a range of benefits:
- Diversification
ETFs offer the opportunity for diversified exposure to stock markets as well as a range of commodities through just one transaction.
- Cost-efficiency
ETFs attract lower management fees with a typical Management Expense Ratio (MER) of less than 1%. They also offer the opportunity to diversify your portfolio with a single transaction cost.
- Flexibility
As ETFs and ETCs are listed on the stock exchange you can buy and sell them directly through your CommSec trading account. This means you can track the value of your investment on an intra-day basis, have the settlement certainty of T+3 and enjoy ease of access with a low minimum initial investment of $500.
- Transparency
ETFs, particularly index funds, aim to disclose their holdings regularly, so you can see exactly what you hold in your portfolio.
How ETFs Compare to Shares and Managed Index Funds
This table summarises the benefits of ETFs over shares and unlisted managed funds.
| Benefit | ETFs | Shares | Managed Index Funds |
| Diversification (exposure to multiple companies with a single trade) |
Yes |
No |
Yes |
| Transparency (real time/daily pricing on the ASX) |
Yes |
Yes |
No |
| Cost efficient (lower internal and management costs) |
Yes |
Yes |
No |
| Direct Market Purchase (purchasing shares directly through a trading account) |
Yes |
Yes |
No |
ETFs and ETCs may expose you to a number of risks including, but not limited to, performance risk and possible foreign currency exchange rate risk - please consider the risk sections of the product disclosure statement or equivalent disclosure document, available from the product issuer.
Investing in ETFs listed on international share markets
CommSec also offers an International Trading account which allows you to trade ETFs listed globally. Find out more.
Advanced Strategies
There are several ways experienced investors can use ETFs as part of an advanced portfolio strategy.
Margin lending
Borrowing to invest (gearing), means you have more money to invest and can potentially increase your returns. These returns can then be used to help pay for the loan while the capital value of your investments increases. A CommSec Margin Loan can help you put these principles to work with ETFs.
Find out more about CommSec Margin Lending or view the current ETFs (PDF, 367kb) approved for CommSec Margin Lending.
The information on this site has been prepared without taking account of the objectives, needs, financial and taxation situation of any particular individual. For this reason, any individual should, before acting on the information on this site, consider the appropriateness of the information, having regards to their own objectives, needs, financial and taxation situation, and, if necessary, seek appropriate independent financial and taxation advice.
This website notes some features of ETFs and ETCs however is not a summary, please consider the product disclosure statement, or equivalent disclosure document, available from the product issuer before making any decision about the relevant ETF and ETC.
CommSec Margin Lending facilities are provided by the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945 and administered by its wholly owned but non-guaranteed subsidiary Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814 (CommSec), a participant of the ASX Group.
A CommSec Margin Loan exposes you to unfavorable movements in the value of shares and units in managed funds, and possibly to margin calls. You are personally liable for any shortfall that occurs should your entire portfolio have to be sold to answer a margin call where there have been falls in the market value of your investments. Only investors who fully understand the risks associated with gearing into investments should apply. Please obtain and consider the product disclosure statement (PDS), available from the Commonwealth Bank of Australia as the product issuer, at www.commsec.com.au before making any decision about the product.
ETF providers
iShares
iShares is the global product leader in exchange traded funds with over 600 funds globally across equities, fixed income and commodities, which trade on 20 exchanges worldwide. iShares is the largest provider of ETFs in Australia, and the leading provider of ETFs over domestic and international markets and indices. They were first listed on the Australian Securities Exchange (ASX) in 2007. There are now 26 iShares ETFs listed on the ASX, covering developed and emerging markets, small and large cap stocks, and providing global, regional and individual country exposure as well as three Australian fixed income ETFs providing simple exposure to this asset class.
Download the iShares product list to view ASX stock codes.
Vanguard Investments
Vanguard was founded in the United States in 1975 on a simple but revolutionary idea – than an investment company should manage the funds it offers in the sole interest of its clients. In 1976, Vanguard pioneered the concept of indexing, introducing the first index fund for individual investors in the United States. Over the decades, Vanguard has grown to become one of the world’s largest investment management companies with a presence in Australia, Europe, Asia, and the Americas and over $2 trillion in assets under management as at 31 December 2012, including more than $200 billion in ETFs. In Australia, Vanguard offers ETFs across Australian shares, international shares, property securities and fixed income securities.
Download the Vanguard product list to view ASX stock codes.
State Street Global Advisors (SSgA)
Offered by State Street Global Advisors, SPDR ETFs are a family of ETFs that provide you with the flexibility to select investments that are precisely aligned to your investment strategy. As the industry pioneer that created the first ever ETF in 1993—the SPDR S&P 500®, which is currently the world’s largest ETF, and introduced ETFs in Australia with the launch of the SPDR S&P/ASX 200 Fund and the SPDR S&P/ASX 50 Fund in 2001. As at 31 December 2012, State Street Global Advisors manage over US$340 billion of ETF assets worldwide, and offer a range of SPDR ETFs available on the Australian Stock Exchange (ASX) that may help you achieve your investment goals.
Download the State Street Global Advisors product list to view ASX stock codes.
ETF Securities Ltd
ETF Securities is one of the world’s leading providers of exchange traded investment products and a pioneer in Exchange Traded Commodities. ETF Securities listed the world’s first exchange-traded gold product on the ASX in 2003, and many other market-leading investment solutions have since followed. Dedicated to providing investors with liquid, transparent investment solutions that can be traded on the world’s stock exchanges. As at 10 January 2013, ETF Securities is responsible for approximately US$29 billion in global investor assets.
Download the ETF Securities product list to view ASX stock codes.
Russell Investments
Russell is a global asset manager with core capabilities that extend across capital markets research, manager research, portfolio construction, portfolio implementation and indexes. Russell combines this expertise to deliver multi-asset solutions that are outcome-oriented to meet the unique needs of Australian institutional investors, financial advisers and individuals. Russell brings the best thinking from around the world to help investors make better decisions.
Russell has more than A$162.9 billion in assets under management (as at 31 December 2012) and works with 2,400 institutional clients, over 580 independent distribution partners and millions of individual investors globally. Russell Exchange Traded Funds (ETFs) are an example of how they use the intersection of their global capabilities including index construction, portfolio management and effective implementation.
Download the Russell Investments product list to view ASX stock codes.
Market Vectors Australia
Market Vectors Australia is a subsidiary of Van Eck Global, which currently ranks as the fifth largest exchange traded product provider in the United States and eighth largest worldwide (as of December 2012). Van Eck Global's Market Vectors family of exchange-traded funds (ETFs) has been offered in the United States since 2006 and currently span international, hard assets, industry-specific, income-oriented, and broad-based asset classes. Market Vectors’ Australian ETFs are passively managed index funds listed on the ASX that track the performance of six sector based indices.
BetaShares
BetaShares is a specialist provider of Exchange Traded Funds (“ETFs”) and fund products which are traded on the Australian Securities Exchange. BetaShares objective is to expand the universe of investment possibilities for investors in Australia. BetaShares is part of the Mirae Asset Global Investment Group, one of the largest asset management firms in Asia. Mirae currently manages approximately US$55B.
Download the BetaShares product list to view ASX stock codes.
This website notes some features of ETFs and ETCs however is not a summary, please consider the product disclosure statement (PDS), prospectus or equivalent disclosure document, available from the product issuer before making any decision about the relevant ETF and ETC. The information on this page has been provided by external product issuers and has not been verified by us. Commonwealth Securities Limited does not accept any responsibility for any losses suffered due to reliance on the information provided on this page.
The information on this site has been prepared without taking account of the objectives, needs, financial and taxation situation of any particular individual. For this reason, any individual should, before acting on the information on this site, consider the appropriateness of the information, having regards to their own objectives, needs, financial and taxation situation, and, if necessary, seek appropriate independent financial and taxation advice.