Best ETFs to Invest in Australia for 2025: A Guide to Portfolio Diversification
Check out our 2025 ETFs for exposure to technology, gold mining, real estate and sustainability. Each ETF offers something different to diversify your portfolio.
Read about the performance, risks and potential growth of ETFs like Vanguard Australian Shares Index ETF, BetaShares NASDAQ-100 ETF and VanEck Vectors Gold Miners ETF. Find yours.
ETFs for high growth sectors, defensive assets and sustainable investing. Competitive dividend yields, low fees and strong returns. Make smart decisions for long term.
Vanguard Australian Shares Index ETF (ASX: VAS)
Investing in the Vanguard Australian Shares Index ETF (ASX: VAS) is a favourite among Australian investors looking for broad market exposure and steady returns.
With its low fees and diversification across the top 300 Australian companies, VAS is a foundation of many portfolios.
In this article we’ll look at VAS’s recent performance, dividend yield, terms, risks and a 2025 hypothetical investment. Whether you’re an experienced investor or new to ETFs this guide will give you the low down on why VAS is worth considering.
VAS: Performance
One of the first things investors look at when considering an ETF is its performance.
As at today VAS is trading at A$103.75 per unit. This price reflects its steady growth and its ability to track the S&P/ASX 300 Index which is the top 300 companies listed on the Australian Securities Exchange (ASX).
Over the last 12 months VAS has returned 13.30%.
This performance shows the ETF’s strength and its correlation to the overall market. For long term investors this is what capital growth looks like.
But past performance is not an indicator of future performance and the market can be volatile.
VAS Dividend Yield
VAS is not just about capital growth it’s also an income generator.
The current dividend yield is 3.22% which is great for income investors. Dividends are paid quarterly so VAS is perfect for those who want regular income.
The dividends from VAS are fully franked which means they come with tax credits that can reduce the tax for Australian investors.
This is great for retirees and those in lower tax brackets. For a growth and income balanced portfolio VAS’s dividend yield is a big tick.
VAS Costs
One of the best things about VAS is its price.
You can buy VAS units directly on the ASX with no minimum investment amount. This makes it perfect for small investors and those with larger portfolios.
The MER is 0.10% which is the lowest cost way to get exposure to the Australian share market.
Low costs are important for long term investors as it means more of your money stays invested and compounding over time.
Also VAS is a passive fund which means it aims to track the S&P/ASX 300 Index rather than actively picking stocks.
This passive approach is also supported by research that shows passive funds outperform active funds over the long term.
VAS Risks
Like all investments VAS has its own risks.
You need to understand these risks:
Market Risk: Since VAS tracks the S&P/ASX 300 Index its performance is tied to the Australian share market. Economic downturns, geopolitical events or changes in market sentiment can affect its value.
Sector Concentration: While VAS has 300 companies it’s most heavily weighted to the financial and materials sectors. These sectors are influenced by interest rates, commodity prices and global economic conditions. For example a big drop in iron ore prices or a banking crisis could affect VAS’s performance.
Currency Risk: Although this ETF is Australian focused some of the companies in the ETF generate some of their revenue overseas. So changes in exchange rates can have an indirect impact on the ETF’s returns.
While there are risks VAS’s broad diversification helps to reduce the impact of any one stock or sector underperforming.
This makes it a lower risk option than investing in individual stocks.
$300K VAS Investment Example
Let’s look at an example:
Investment Amount: A$300,000
Unit Price: A$103.75
You would buy approximately 2,891 units of VAS with this investment amount.
With a 3.22% dividend yield the annual income would be around A$9,660 before tax and reinvestment.
Income is paid quarterly so you get regular cash flow.
And if the ETF continues to grow at historical rates the overall value of the investment could grow significantly over time.
Of course this is a best case scenario and not guaranteed.
Why VAS is a Good Choice
VAS has several advantages that make it a great choice for Australian investors:
Diversification: 300 companies means minimal risk of any one stock underperforming.
Low Cost: 0.10% MER means fees won’t eat into your returns over time.
Regular Income: Fully franked dividends and tax benefits.
Convenience: As a passive fund VAS requires no active management from you so it’s a low maintenance investment.
How to get the most out of VAS
To get the best out of your VAS investment:
Reinvest Dividends: Many investors choose to reinvest their dividends to benefit from compounding over time. Vanguard offers a Dividend Reinvestment Plan (DRP) to make this easy.
Long Term Approach: The market can be volatile short term but a long term approach will help you weather the ups and downs and get steady growth.
Spread Your Portfolio: While VAS is a great base for an Australian portfolio consider adding international ETFs for broader global exposure.
Check Performance: Although VAS is a passive investment it’s still worth checking in periodically to make sure it’s on track to meet your financial goals.
VAS Investment Summary
Vanguard Australian Shares Index ETF (ASX: VAS) a solid and low cost investment for the Australian market.
It’s got great historical performance, good dividend yield and low fees so it’s a good choice for growth and income investors.
However like any investment VAS has risks including market volatility and sector concentration.
By knowing the risks and having a long term diversified investment strategy you can get the most out of this ETF.
If you’re investing a large amount like A$300,000 it’s worth talking to a financial advisor to get personal advice and make sure your portfolio is on track to meet your goals.
With its history and investor benefits VAS is a good choice for 2025 and beyond.
BetaShares NASDAQ-100 ETF (ASX: NDQ)
The BetaShares NASDAQ-100 ETF (ASX: NDQ) gives you access to the NASDAQ-100 Index which is the 100 largest non-financial companies listed on NASDAQ. It’s focused on high growth sectors.
NDQ gives you access to global tech giants like Apple, Microsoft and Alphabet headquartered in Silicon Valley. This article covers its performance, risks and 2025 outlook.
NDQ Performance
NDQ is currently priced at A$35.50 per unit and is tracking the NASDAQ-100 Index very closely. Over the past year it’s returned 15.50% due to strong tech performance.
Tech giants like Apple based in Cupertino were a big contributor to the ETF’s growth. Past performance is not an indicator of future performance as market volatility can affect outcomes.
NDQ Dividend Yield
NDQ has a 1.35% dividend yield and is focused on long term growth. This reflects the high growth potential of tech companies with semi-annual dividends providing occasional income for growth investors.
NDQ Fees
MER 0.48% NDQ is low cost considering it’s an international ETF with companies like Amazon (based in Seattle) and Meta (in Menlo Park) included. No minimum investment required so suitable for retail and institutional investors.
Risks of Investing in NDQ
NDQ risks include market volatility, tech sector performance and currency fluctuations. The tech companies in the index are highly exposed to regulatory changes, innovation and earnings reports. Currency movements will also impact performance given the US companies are international.
$300,000 in NDQ
$300,000 would buy around 8,450 units of NDQ. That would generate a projected annual dividend of A$4,050 and with the big tech companies like Google and Microsoft growing the investment will grow significantly over time.
Why NDQ
NDQ gives you access to high growth global tech companies based in hubs like Silicon Valley and Seattle. For investors looking for successful innovative companies it’s a good choice for long term growth.
Vanguard MSCI International Shares ETF (ASX: VGS)
The Vanguard MSCI International Shares ETF (ASX: VGS) gives you access to the MSCI World ex-Australia Index which includes large and mid-cap companies across developed markets. This global ETF covers a wide range of sectors.
VGS gives you access to established companies in North America, Europe and Asia and provides broad international diversification. This article covers VGS’s performance, risks and 2025 outlook.
VGS Performance
VGS is currently priced at A$97.10 per unit and is tracking the MSCI World ex-Australia Index. Over the past year it’s returned 11.70% due to strong US equities performance.
Microsoft and Johnson & Johnson were among the big international companies that contributed to this growth. Past performance is not an indicator of future performance due to market and global economic changes.
VGS Dividend Yield
VGS has a 2.05% dividend yield for investors to receive regular income from global dividend paying companies. Semi-annual distributions for those looking for income and international equity exposure.
VGS Fees
MER 0.18% VGS is very low cost for broad international diversification. Suitable for individual and institutional investors with no minimum investment required.
VGS Risks
VGS risks include currency fluctuations, global market volatility and economic downturns in developed markets. Performance of the key markets like US and Europe will impact returns.
Potential Outcomes for a $300K Investment in VGS
A $300,000 investment would buy around 3,090 units of VGS, with a projected annual dividend of $6,150. With ongoing global exposure and high dividend yields, this could grow in value over time.
Why VGS?
VGS gives you broad international diversification, access to established companies in developed markets. If you want long term growth and global equities outside of Australia, VGS is a good option.
VanEck MSCI International Small Companies Quality ETF (ASX: QSML)
The VanEck MSCI International Small Companies Quality ETF (ASX: QSML) gives you exposure to high quality small cap companies with growth potential in developed international markets, across various sectors with good characteristics.
QSML gives you access to global innovators like ASOS, the London based e-commerce giant and Amadeus IT Group, the Madrid based tech company. This article looks at QSML’s performance, risks and 2025 outlook.
QSML’s Recent Performance
QSML is trading at $28.75 per unit, reflecting small cap company performance globally. Over the past year it returned 18.25%, driven by strong performances from ASOS and global tech growth.
Despite this, past performance is not a guide to future performance and investors should be aware of market volatility, especially in the small cap space which can be volatile and sentiment driven.
QSML Dividend Yield
QSML has a 1.75% dividend yield, reflecting its focus on quality small cap companies reinvesting for growth. Semi annual dividends means investors get modest returns and long term capital growth in markets like Europe and North America.
Cost
0.40% MER, QSML gives you affordable access to a diversified global small cap portfolio, including companies in hubs like New York and Paris. No minimum investment, suitable for individuals and institutions.
QSML Investment Risks
QSML risks include market volatility, small cap sector underperformance, economic conditions. Small companies can have business disruption and international exposure means foreign exchange, geopolitical risks, sensitivity to regulations and investor sentiment.
$300K QSML Outcomes
A $300,000 investment would buy around 10,430 units of QSML, with a projected annual dividend income of $5,250. Long term growth comes from companies like Amadeus IT Group and ASOS.
Why QSML
QSML gives you exposure to high quality international small companies across sectors from innovation hubs like London, New York and Paris. It gives you global growth outside large caps, good for long term diversification.
BetaShares Global Cybersecurity ETF (ASX: HACK)
The BetaShares Global Cybersecurity ETF (ASX: HACK) gives you exposure to the global cybersecurity sector, access to the leading cybersecurity companies operating across industries worldwide.
HACK includes companies like Palo Alto Networks, CrowdStrike and Fortinet which are based in tech hubs like Silicon Valley and Massachusetts. This article looks at the ETF’s performance, risks and 2025 outlook.
HACK ETF Recent Performance
HACK is trading at $13.20 per unit, driven by strong performance as global demand for cybersecurity solutions grows. Over the past year it returned 18.25% with key companies contributing to the growth.
The performance is due to major companies like Palo Alto Networks, based in Santa Clara, California. But remember past performance is not a guide to future performance and market volatility can affect returns.
HACK Dividend Yield
HACK has a 1.10% dividend yield, occasional payouts while focusing on long term growth. Performance is driven by high demand for security solutions, companies like CrowdStrike expanding globally.
HACK Cost
0.67% MER, HACK is cheaper than other sector focused ETFs. Global exposure to emerging markets and established cybersecurity companies like Fortinet means retail and institutional investors can access the fund.
Risks to Consider Before Investing in HACK
Sector specific market volatility, regulatory changes to global cybersecurity standards and technological advancements that can change the competitive landscape.
As a global fund, investors should be aware of currency risks, geopolitical events and different regulations across countries that can impact cybersecurity companies.
$300K HACK Outcomes
A $300,000 investment would buy around 22,727 units of HACK, with an estimated $3,300 in annual dividend income. The ETF’s growth is driven by cybersecurity companies like CrowdStrike and Palo Alto Networks expanding globally.
Why HACK
HACK gives you access to a growing global industry, driven by growing demand for cybersecurity services. For investors looking to the future of cybersecurity, with key players in Silicon Valley and Boston, it’s a long term growth option.
BetaShares Australian High Interest Cash ETF (ASX: AAA)
The BetaShares Australian High Interest Cash ETF (ASX: AAA) gives you access to high interest cash investments, competitive yields from a portfolio of major Australian bank deposits. It’s all about capital stability and liquidity.
AAA invests in deposits from institutions like Commonwealth Bank (based in Sydney) and NAB (headquartered in Melbourne). This article looks at the performance, risks and 2025 outlook.
AAA ETF Recent Performance
AAA is trading at $50.10 per unit, driven by the cash alternative. Over the past year it returned 4.10% with the rise in Australian interest rates.
The ETF’s investments in high interest deposits from major Australian banks like Westpac (based in Sydney) contributed to the stability. But past performance is no guide to future returns especially with changing interest rates.
AAA Dividend Yield Breakdown
AAA has a 4.20% dividend yield, paid monthly. A regular income stream for conservative investors looking for stable returns, with Australian financial institutions guaranteeing interest payments.
With major banks in cities like Melbourne and Brisbane, AAA is a safe way to have liquidity and get higher returns than a standard savings account.
AAA Cost
0.18% MER, AAA is cheap for income focused investors. No minimum investment required, so all investors can access the fund.
Underlying assets are deposits from major banks like ANZ (based in Docklands, Melbourne) so you get broad exposure to the Australian financial sector.
Risks of AAA
Interest rate changes impacting income and downturns in the Australian financial sector. Geographical concentration in Sydney, Brisbane and Melbourne is diversified through the cash deposits.
What is $300K in AAA?
A $300,000 investment buys 5,990 AAA units, with $12,600 annual income at current yields. NAB in Melbourne and CBA in Sydney means stability and low risk cash returns.
Why AAA?
AAA gives you high yield cash exposure through Australian banks in Sydney, Melbourne and Brisbane. It’s stable, liquid and competitive returns for risk averse investors looking for a reliable income solution.
SPDR S&P/ASX 200 Listed Property Fund (ASX: SLF)
The SPDR S&P/ASX 200 Listed Property Fund (ASX: SLF) gives you exposure to the S&P/ASX 200 A-REIT Index, a diversified portfolio of Australian Real Estate Investment Trusts (A-REITs) focused on income stability.
SLF includes major property companies like Scentre Group, Dexus and Mirvac in areas like Sydney, Melbourne and Brisbane. This article looks at the performance, dividend yield, risks and 2025 outlook.
SLF ETF Recent Performance
SLF is trading at $11.85 per unit, tracking the S&P/ASX 200 A-REIT Index. Over the past year it returned 7.20% with the recovery of the Australian property market in Sydney and Melbourne.
Scentre Group, managing Westfield malls across Australia, has contributed to the ETF’s performance. But past performance is no guide to future returns especially with property market sensitivity to economic changes.
SLF Dividend Yield
SLF has a 4.20% dividend yield for investors looking for stable income. This is the cash flow from commercial and retail properties, with quarterly distributions for income focused portfolios.
SLF Cost
0.40% MER, SLF is competitive for local property exposure. You get access to companies like GPT Group (based in Sydney) and Charter Hall (in Melbourne). No minimum investment so suitable for all investors.
SLF Risk Analysis
SLF risks include property value fluctuations, interest rates and broader economic trends. A-REITs performance is linked to rental demand in areas like Sydney CBD or Melbourne’s Docklands. Rising interest rates will impact borrowing costs and property valuations.
$300K in SLF ETF
A $300,000 investment would buy approximately 25,320 SLF units. That’s $12,600 projected annual income from blue chip REITs like Dexus which manages premium office properties across Australia.
Why SLF
SLF gives you exposure to the Australian property market, across retail, commercial and industrial sectors. Income and long term focused investors will benefit from its exposure to major real estate hubs like Sydney, Melbourne and Brisbane.
BetaShares Global Sustainability Leaders ETF (ASX: ETHI)
BetaShares Global Sustainability Leaders ETF (ASX: ETHI) gives you exposure to a globally diversified portfolio of sustainable companies. It’s focused on companies leading in environmental, social and governance (ESG) standards.
ETHI gives you access to companies like Tesla, Microsoft and Nvidia based in cities like Palo Alto and Redmond. This article looks at its performance, risks and 2025 outlook.
ETHI ETF Performance
ETHI is trading at $12.80 per unit, tracking global ESG indices. Over the past year it returned 9.75% with growth in the renewables and tech sectors.
Tesla based in Palo Alto was a major contributor to this growth. But past performance is no guide to future returns with global ESG sector changes impacting performance.
ETHI Dividend Yield
ETHI has a 1.10% dividend yield, focused on long term capital growth. Semi-annual dividend distributions support its sustainable growth outlook for ESG investors looking for future resilience.
ETHI Cost
0.59% MER, ETHI is a low cost way to get exposure to ESG companies like Adobe (San Jose) and Vestas Wind Systems (Aarhus). No minimum investment so suitable for all investors.
ETHI Risks
ETHI risks include sector concentration, global market volatility and regulatory changes in ESG practices. Many of the companies in the ETF rely on technology and renewables and are subject to changes in global policies, consumer trends and economic conditions.
$300K in ETHI
A $300,000 investment would buy approximately 23,430 ETHI units. That’s $3,300 estimated annual income and growth from companies like Tesla and Nvidia driving growth in sustainable sectors.
Why ETHI?
ETHI gives you access to companies setting global ESG benchmarks, in hubs like Palo Alto and Aarhus. For socially responsible investors ETHI is a balance of sustainability and growth.
VanEck Vectors Gold Miners ETF (ASX: GDX)
The VanEck Vectors Gold Miners ETF (ASX: GDX) gives you exposure to the top gold mining companies globally like Newmont Corporation. It gives investors access to the sector’s defensive and growth.
GDX includes companies involved in mining, refining and producing gold like Barrick Gold in Toronto. It’s a good option for those looking for stability and long term portfolio diversification.
Global with GDX ETF
GDX has global gold miners like Newmont Corporation in Colorado and Barrick Gold in Toronto. This article looks at its performance, risks and 2025 outlook.
These companies drive GDX’s growth so it’s a good option for diversification. GDX covers various regions so you get to see gold’s stability and potential as a defensive strategy.
GDX Recent Performance
GDX is trading at $42.30 per unit, tracking the global gold price. Over the past year it returned 7.20% with steady demand for gold.
AngloGold Ashanti based in Johannesburg was a major contributor to this return. But future performance will be impacted by economic conditions and geopolitical events.
GDX Dividend Yield
GDX has a 1.60% dividend yield for investors looking for modest income and capital preservation. Dividend distributions are annual and based on the profitability of the underlying mining companies.
GDX Cost
0.53% MER, GDX is competitively priced for international gold mining giants. No minimum investment so suitable for all investors.
GDX Risks
GDX risks include gold price volatility, geopolitical events and mining specific risks like operational delays. Currency movements will also impact returns as the ETF has companies in Canada, US and South Africa.
$300K in GDX
A $300,000 investment would buy approximately 7,100 GDX units. That’s $4,800 estimated annual income and growth from gold price and miner performance.
Why GDX
GDX gives you exposure to a defensive asset class by investing in gold mining giants like Newmont and Barrick. Good option for those looking for portfolio diversification and long term stability through gold.
FAQs
What are the best ETFs for 2025?
Best ETFs for 2025 will likely be those that focus on sustainable sectors, technology and key Australian indexes. ETFs in growth areas like AI, clean energy and infrastructure stand out.
Performance varies by sector, ETFs that focus on large caps, real estate and key infrastructure industries have held up well in market volatility. Always look at past trends to see what to expect for 2025 growth.
Which ETFs are in the Australian market?
ETFs like the SPDR S&P/ASX 200 ETF (STW) give you broad market exposure by tracking the ASX 200. Others like iShares S&P/ASX 100 give you diversification across top Australian companies.
Also ETFs like BetaShares Australia 200 gives you a diversified portfolio of Australian companies, low cost and efficient exposure to the Australian stock market with a focus on established industries and high performers.
How do ETFs differ from mutual funds?
ETFs are listed on exchanges so you get intraday liquidity and often lower fees than mutual funds. Mutual funds are priced at the end of each trading day.
ETFs give you passive or active exposure to the market, mutual funds are actively managed. ETFs are lower cost and tax efficient, mutual funds are hands off investment and professional portfolio management.
What are the advantages of ETFs?
ETFs give you diversification in one investment, reduces risk across multiple assets. They give you exposure to sectors like technology or sustainability with low management fees.
ETFs are liquid and cost effective. Low expense ratio compared to mutual funds makes ETFs good for long term investors. You get instant access to multiple securities in one trade, makes it easy for beginners and professionals.
Are there ETFs for sustainable or ESG?
Yes, ETFs like the BetaShares Global Sustainability Leaders ETF (ETHI) and Vanguard ESG International Shares ETF focus on environmental, social and governance (ESG) criteria, responsible investing.
These ETFs track companies that meet global sustainability standards, renewable energy and green tech leaders. Ethical investing has grown rapidly as demand for ESG funds increases, long term and short term outlook is improving.
How do I measure the risk of an ETF?
Risk can be measured by looking at the ETF’s portfolio composition and sector exposure. Volatility, correlation to market indices and underlying assets stability is the measure of risk.
Market research, risk rating tools and knowing the ETF’s tracking method (passive or active) helps investors measure potential losses or gains. Evaluating liquidity, fees and asset class exposure can reduce risk over time.
What are the tax implications of ETFs in Australia?
ETFs in Australia are subject to Capital Gains Tax (CGT), where gains are taxed when you sell, depending on the holding period. Dividends from Australian ETFs may also be taxed at your income tax rate.
If an ETF gives franked dividends, investors can get franking credits which reduces the tax payable. Plan with your tax advisor to manage ETFs for tax efficiency.
How do I choose between ETFs with same investment objectives?
When choosing between similar ETFs, consider fee structure (MER), historical performance, dividend yield and liquidity. Compare sector diversification and underlying asset composition to decide.
Also consider fund manager reputation, investment strategy and long term market view. Know your financial goals and risk tolerance will guide you to choose the ETF that suits your investment profile and desired outcomes.
What are the fees of ETFs?
Fees or MER range from 0.10% to 1.00%. Low fee ETFs are more cost effective and good for long term investors. Fees are deducted from the fund’s assets.
Comparing MER is important when choosing an ETF, higher fees can eat into returns especially for passive or low returning investments. Funds with high costs may not justify the performance for risk averse investors.
Can ETFs go international?
Yes, ETFs like iShares Global 100 ETF (IOO) and Vanguard All-World ex-US Shares ETF go global. These ETFs diversify into international stocks or countries, spreading global risk.
ETFs that focus on emerging markets or specific regions can take you beyond domestic investments. By tracking international indices and global securities you get access to growth opportunities outside Australia.
How do currency movements affect international ETFs?
Currency movements can affect the returns of international ETFs, especially if the underlying assets are in foreign currency. If the AUD strengthens, your returns from overseas investments will decrease.
On the other hand a weaker AUD can increase the returns when you convert international gains back into AUD. Monitoring currency movements alongside international ETF performance is important to understand the impact on your returns.
Are there ETFs that focus on specific sectors like technology or healthcare?
Yes, there are sector specific ETFs like BetaShares Global Cybersecurity ETF (HACK) or Vanguard Health Care ETF (VHT) that gives exposure to tech, healthcare and biotechnology.
Sector ETFs allows you to invest in specific high growth industries. By focusing on sectors like AI or biopharma you can build a portfolio that suits your interests, risk tolerance and market view, sector diversification.
What is the liquidity of ETFs and how does it affect trading?
ETFs are liquid as they can be traded on the exchange throughout the day. Liquidity depends on the ETF’s size, trading volume and underlying asset liquidity.
Liquidity affects trading costs, highly liquid ETFs have lower spreads making it easier and cheaper to buy or sell. For investors with large volumes, liquidity means seamless transactions, impact overall investment efficiency and cost.
How do dividends work with ETFs?
Dividends from ETFs are typically paid based on the underlying securities’ dividends. These can be quarterly, semi-annually or annually and can be reinvested or received in cash.
ETFs provides dividend yield based on the total income of the assets in the ETF. Dividends are taxable and investors should plan their taxes to maximise their returns and manage their tax liabilities on distributions.
What are synthetic ETFs and how are they different from physical ETFs?
Synthetic ETFs use derivatives like swaps to replicate the performance of an underlying index instead of owning the assets directly. Physical ETFs own the actual securities.
Synthetic ETFs have lower management costs and flexibility but exposes investors to counterparty risk. Physical ETFs have greater transparency and lower derivatives risk but may have higher tracking costs and fees.
How do I start investing in ETFs in Australia?
To start investing in ETFs open a brokerage account with a platform that offers ETFs. Choose your ETF based on goals, fees and risk tolerance. After buying, monitor its performance.
You can also consider seeking advice from a financial planner or using an investing app, both are great for beginners. Before investing, read the trading fees and platform’s ease of use for portfolio management.
What are the risks of ETFs?
ETFs face market risks based on the asset classes they track, such as global market volatility or interest rate risks. A market can go down and performance can dip or returns can be lower.
Sector specific ETFs have additional risks based on that industry’s performance. You should check the underlying holdings and their risk profile before investing. Diversified ETFs reduce risk but no investment is risk free.
How have ETFs performed in the Australian market?
Historically ETFs in Australia have tracked the overall market and provided returns in line with long term market growth. Index tracking ETFs like ASX 200 have given stable returns.
ETFs with sector exposure have been volatile but often higher returns over time. Australian ETFs have become popular for their liquidity, cost efficiency and diverse portfolio options for growth investors.
Are there ETFs that focus on small cap or emerging companies?
Yes, ETFs like SPDR S&P/ASX Small Ordinaries ETF (Ord) track small cap Australian stocks. Others like Vanguard FTSE Emerging Markets ETF track emerging market stocks.
Investing in small cap or emerging company ETFs offers higher growth but higher risk. These markets are less stable than large cap companies but offers higher returns if managed properly.
How do I monitor and manage my ETFs over time?
To monitor ETFs, regularly check your portfolio’s performance on your brokerage platform. Set up alerts for price changes, dividends and significant market movements to track your investments.
For ongoing management, adjust your holdings periodically based on market conditions or your financial goals. Rebalance to maintain your target asset allocation and consult a financial planner when needed.
Originally Published: https://www.starinvestment.com.au/best-etfs-australia-2025-diversify-portfolio/
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