WHAT IS AN ETF?

‘Exchange Traded Funds’ are an easy way to invest

ETFs are investment funds that aim to track the performance of a specific index, such as the Swiss Market Index (SMI).

An index represents the total return of a particular group of securities – often shares.

How do they do that?

A group of securities are effectively collected in a basket with the amount of each security in the fund weighted by size to precisely replicate a particular index. An ETF is bought and sold on a stock exchange, like a share.

Advantages

Flexibility

ETFs provide exposures to suit both your core portfolio and tactical investing.

Cost-effective

ETFs often have lower management fees than active funds and the costs are simpler to calculate.

Diversification

ETFs offer a single source of instant exposure to returns from diverse securities.

Transparency

ETFs show every security currently in the fund so you know exactly what you own.

Liquidity

ETFs are listed on exchanges and can be traded at any time during market hours.

Access

ETFs allow instant access to international markets.

The variety of available ETFs mean that you could

 

invest in a single ETF as a core exposure to complement your portfolio	fine tune your preferred exposure in a particular region, commodity or asset class	build an entire investment portfolio at a lower cost using ETFs	create a solid, relatively inexpensive core to your portfolio releasing capital for more active investing