What are some key features of exchange-traded funds?

• An ETF is a collection of securities that can include shares, bonds, commodities, and currencies
• ETFs might include Australian or international assets
• You can buy and sell units in an ETF the same way you purchase shares through a stockbroker or via an online share trading platform.
• You usually purchase units in an ETF, not its underlying investments
• The unit price of an ETF fluctuates during the day as it’s bought and sold on an exchange
• ETFs often have low management expense ratios (MERs) or fees

How long can I hold IPO shares?

Investing in an IPO comes with an additional lock-up period, which can be anywhere between 90 to 180 days. During this period, shares can not be sold by company insiders, such as founders, owners, managers and employees.

 

How much money will I receive in dividends?

The amount of dividends paid is determined by the profitability of the company because dividends are paid out of the revenue generated. The dividend payout ratio (dividend paid divided by net income) helps understand what percentage of the company’s net profits are paid out as dividends.