How to Invest in the ASX 200

Many people understand that the S&P ASX 200 is one of the premium market indicators used to understand the current state of the Australian stock market. With approximately 78% of market capitalisation covered under the ASX 200, you can see why many consider the index as the investable benchmark for the Australian market.

However, apart from utilising the ASX 200 as a tool to predict larger market movements, there are other ways to benefit from the ASX 200. One way that is growing in popularity is through Exchange Traded Funds, and there is an ETF that is designed to closely track the performance of the ASX 200.

It is called the SPDR S&P/ASX 200 fund (ASX Code: STW), and it seeks to closely match the trends of the ASX 200. You can buy and sell shares in this fund over the stock exchange, and the fund aims to provide low portfolio turnover and lower costs. A full list of the top holdings and related ASX 200 charts are available on the SPDR S&P/ASX 200 fund website.

The fund gives investors broad exposure to the Australian stock market, and other advantages include the transparency of performance and the tradability of shares. There are also similar funds available from SPDR, including an ASX 50 fund and an ASX 200 listed property fund.

Always consult a financial professional before undertaking any investment you are uncertain about, and always look thoroughly at the information presented to you to decide if ETFs are a suitable investment for you.