Kate Campbell

So when you're investing in Australian shares, you're firstly hoping that the businesses grow and develop, they create new products, they get new customers, they add more employees.

And over the next 10 or 20 years, most of the companies in your ETF will grow.

Some might shrivel up and die, some might stagnate, but you're hoping that quite a few will grow.

And that means the overall basket in your ETF will go up in value.

Yeah.

Like when I buy my outdoor, indoor plants, some of them succeed.

I brought a whole range of different plants.

Some of them look okay.

They're kind of like half alive and some of them die.

And so, the hope is by buying a range of different companies, you'll get- And get them all in one big basket.

You won't have complete success, but you won't have complete failure.

You mentioned dividends as well.

Dividends, of course.

Large Australian companies will often pay part of the profits each year to the shareholders.

If you own a share of CBA and CBA makes money, they will pass some of that money back to you as the shareholder because just owning one share of CBA means you're a shareholder of that company and you own part of the pie.

It's a very big pie, but you own a tiny sliver of it.

If you own an Australian ETF,

you get to benefit from all of the companies in that ETF paying part of their profits to shareholders as dividends.

But the ETF provider like BetaShares and State Street collect all of those dividends together and they pay you your portion as a distribution.

Makes sense.