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Exchange Traded Funds (ETFs)
What are ETFs?
Exchange Traded Funds, or ETFs, are pooled funds that are traded on the stock exchanges around the world in exactly the same way as stocks and shares. They are neither Unit Trusts nor Investment Trusts, but are a new type of investment which was first traded in the US in 1993 and launched in the UK in late 2000.
Each fund is set up to track the performance of an index or market sector by buying all the underlying stocks in proportion to their weighting. Effectively, each ETF is combining the performance of the traditional tracker funds with the flexibility of ordinary shares. ETFs are extremely popular with investors as a way of diversifying their portfolio in order to spread the amount of risk.
ETFs are traded like ordinary shares and are listed on recognised stock exchanges, for example, the London Stock Exchange and the New York Stock Exchange. As such their value can go down as well as up and you may get back less than the amount you invested.
| Five key benefits to Exchange Traded Funds with Halifax Share Dealing |
| 1. Highly competitive dealing charges - deal online for only £11.95 (excluding international deals) or over the telephone from £15 |
| 2. Deal online - access your account 24/7, 365 days a year |
| 3. No stamp duty to pay on ETFs - the fund managers have already paid duty when buying the underlying shares |
| 4. Reduced exposure to the risks associated with trading single shares |
| 5. Low annual management costs compared to other pooled investments - these costs are already built into the fund price therefore there are no additional charges. |
Which accounts can I hold ETFs in?
Share Dealing Account - the simple way to trade ETFs
Halifax ShareBuilder - regularly invest in ETFs for reduced commission
Self-Select Stocks & Shares ISA - the tax efficient way to invest in the stock market brought to you by our award winning service
SIPP - take control of your pension with a Self-Invested Personal Pension
Next Steps
Apply Now for an account
Transfer your investments held with another broker to us
Research the performance of ETFs listed on the London Stock Exchange
Halifax Share Dealing Limited. Registered in England No. 3195646. Registered Office: Trinity Road, Halifax, West Yorkshire, HX1 2RG. Authorised and regulated by the Financial Services Authority, 25 The North Colonnade, Canary Wharf, London, E14 5HS. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.
