How do these work?

Stavros_3

I'm refering to Ishares FTSE 100 Nav. Am I right in thinking that if the FTSE 100 index is 3900 say, if I were to buy a thousand shares, would that cost me around £3,900, then the value would increase/decrease in line with the FTSE index, cheers

turbobob

Stavros wrote: »

I'm refering to Ishares FTSE 100 Nav. Am I right in thinking that if the FTSE 100 index is 3900 say, if I were to buy a thousand shares, would that cost me around £3,900, then the value would increase/decrease in line with the FTSE index, cheers

Yes, the value would decrease or increase in line with the index (subject to any tracking error). ETF's are traded on the stock exchange and so the price changes throughout the day. This contrasts with OEIC's or unit trusts which are priced once daily. The dividends are paid to you (in that particular ETF, they are distributed quarterly).

You buy at the offer price and sell at the bid price. As of about 20 minutes ago the prices were:

Bid 392.30p Offer 392.50p

Stavros_3

Many thanks