You buy an ETF through a share broker, exactly like buying a share. The broker choice comes down to four things: who holds your units (CHESS-sponsored in your name, or custodial), brokerage per trade, currency fees if you buy overseas, and whether it offers auto-invest. Over the long run, the ETF's own fee usually matters more than brokerage: on $100,000 over 20 years, the gap between a 0.04% and a 0.48% ETF is about $30,000.
Before you start: are you ready?
An ETF (exchange-traded fund) is a fund that trades on the share market. One purchase gives you a slice of hundreds or thousands of companies. Australians now have about $388 billion in more than 500 exchange-traded products, and investors added about $6.9 billion of new money in September 2026 alone.
Before you buy, three checks are worth a minute:
- Emergency money first. Shares can fall 20% or more in a bad year. Money you may need in the next few years usually belongs in cash, not an ETF.
- Know your time frame. Share ETFs suit money you can leave alone for five years or more.
- Have your details ready. Photo ID, your Tax File Number and your bank account. Without a TFN, tax can be withheld from your distributions at the top rate.
The four things to compare in a broker
Broker prices and features change often, so we don't list them here. What doesn't change is the checklist. Look at each broker's current fee page against these four points.
1. CHESS-sponsored or custodial?
This is the most important difference, and the one most people skip.
- CHESS-sponsored. Your units are registered in your own name on the ASX register, under your own Holder Identification Number (HIN). If you change brokers, your holdings move with your HIN. You deal with the ETF's share registry directly for distributions and reinvestment plans.
- Custodial. A custodian holds the units on your behalf and you are the beneficial owner. This model often makes very low fees, small dollar amounts and fractional units possible. The trade-off: you rely on the provider's systems, transferring out can be slower, and you may not be able to join the issuer's own reinvestment plan.
Neither is wrong. Many investors with larger balances or an SMSF prefer CHESS sponsorship for the direct ownership. Custodial platforms can suit people starting small with regular amounts.
2. Brokerage
Brokerage is the fee for each buy or sell. Some brokers charge a flat fee, some a percentage, and some charge nothing on certain ETFs. What matters is how it compares with the size of your trades. A flat fee that is trivial on a $20,000 purchase can be a big bite of a $500 one. We work out when investing monthly beats quarterly.
How a hypothetical $10 fee compares with your trade size
3. Currency (FX) fees
If you only buy ASX-listed ETFs, you trade in Australian dollars and never pay a broker currency fee, even for overseas funds like IVV or VGS. The fund converts currency inside the fund at wholesale rates. If you also want to buy shares or ETFs on US exchanges, check the broker's currency conversion margin. It is often a percentage of every dollar converted, and it can cost more than the brokerage itself.
4. Auto-invest and small amounts
Some platforms let you set a regular amount, say every fortnight, and buy automatically. This takes the emotion out of investing and suits people building a habit. Check which ETFs are included, whether fractional units are allowed, and what each automatic buy costs.
The ETF's fee matters more than brokerage
Brokerage is paid once per trade. The ETF's management fee (the MER, or management expense ratio) is taken every year, on your whole balance, for as long as you hold it. Over decades, that is usually the bigger cost.
What ETF fees cost on $100,000 over 20 years
A higher fee is not automatically bad. DHHF does the work of several funds, and NDQ gives a specific exposure. But it is worth knowing what you pay. Browse the lowest-cost ETFs to see the cheapest in each category.
How to buy an ETF: five steps
- Open an account. Most brokers verify your identity online in minutes. If you invest through an SMSF, the account must be in the fund's name.
- Add money. Transfer from your bank. Some brokers settle instantly, others take a day or two.
- Choose your ETF. Every ETF has a three or four letter code, such as VAS or A200 for Australian shares, or IVV, VGS and BGBL for global shares. Search the ETF directory or start with our best ETFs list.
- Place the order. Enter the code, the amount and the order type (see below). Your first purchase of any holding on the ASX generally needs to be at least $500.
- Settle and hold. Trades settle two business days later. Distributions are then paid to your bank or reinvested, depending on what you choose.
Placing the order: market or limit?
- Market order: buys straight away at the best price on offer. Simple, and usually fine for large, busy ETFs.
- Limit order: you set the highest price you will pay. It only fills at that price or better. This gives you control, especially in smaller ETFs.
- Avoid the first 15 to 30 minutes. The ASX opens at 10am. Market makers (the firms that quote buy and sell prices for ETFs) need time to price the underlying shares, so early quotes can be wider. Waiting until the market settles usually gets you a fairer price.
The gap between the buy and sell price is called the spread. It is a hidden cost every time you trade. For the biggest ETFs it is tiny. For small, niche funds it can be many times larger.
Average buy and sell spread
Build the habit, avoid the traps
Most investors are not hurt by the broker they chose. They are hurt by what they do afterwards.
- Invest regularly. A set amount each month means you buy more units when prices are low and fewer when they are high.
- Don't chase last year's winner. The best-performing ETFs of one year are often not the best of the next.
- Don't collect duplicates. VAS and A200 are about 94% the same. Check with the overlap calculator before adding a second fund.
- Keep your records. You will need your buy prices and annual tax statements when you sell.
Not sure what to buy first? Most new investors start with the biggest, cheapest funds. In September the largest flows went to VGS, VAS, IOZ, A200 and BGBL.
Most popular ETFs in September 2026
Compare the popular pairs: VAS vs A200, VGS vs BGBL and VGS vs IVV.
Costs and tax after you buy
ETF distributions are taxable income in the year they are paid, even if you reinvest them. Australian-share ETFs usually pass on franking credits, which can reduce your tax. When you sell, any profit is a capital gain, and if you held the units for more than 12 months, individuals generally get a 50% discount on that gain. Your ETF issuer sends an annual tax statement that does most of the work. Our ETF tax guide covers it in detail.
Next: the best ETFs for beginners →
Common questions
What is the minimum amount to buy an ETF in Australia?
On the ASX your first purchase of a new holding generally needs to be at least $500. Some custodial platforms let you start with much smaller amounts and buy fractions of a unit.
Is CHESS-sponsored better than custodial?
CHESS sponsorship registers the units in your own name and makes moving brokers simple. Custodial platforms hold units for you and often allow lower costs and fractional buying. Which suits you depends on your balance, how often you invest and how much direct ownership matters to you.
Do I pay currency fees on ASX-listed international ETFs?
No broker currency fee applies, because you buy them in Australian dollars. The fund handles currency internally. Broker FX fees apply only when you buy on overseas exchanges.
What time of day should I buy ETFs?
The ASX trades from 10am to 4pm on weekdays. Many experienced investors avoid the first 15 to 30 minutes, when spreads can be wider, and use a limit order on smaller ETFs.
Joshua Stega is a financial adviser with 20 years' experience and the founder of ETF Adviser. He built ReviewETF to make every Australian ETF easy to find and compare.
General information only. It does not take into account your objectives, financial situation or needs. Consider the PDS and TMD before investing. Past performance is not a reliable indicator of future performance. Data as at 30 September 2026.