Trackers, also known as exchange-traded funds (ETFs), are passively managed investment funds that track indices very closely.

·         Trackers provide opportunities for investors to achieve instant, efficient and inexpensive exposure to a market, a sector or a whole country.

·         With just one transaction, investors can put together a diversified investment portfolio.

·         Trackers are passively managed, which means they have relatively low management fees.

·         Trackers are listed on the exchange, so they can be bought and sold on the exchange at any time during a trading day and at current market prices.

·         Trackers have no expiry date.

·         There are no entry or exit fees for trackers.

·         Most trackers pay out regular dividends.

·         As trackers follow an index so closely, their performance corresponds to that of the reference index.

·         Trackers can be used as the underlying for index options and futures.

An index is a barometer of the financial situation in a region, a country or a specific sector, and it includes the most representative and most actively traded shares in that particular market or sector. In practice, it is difficult to outperform an index on a consistent basis. Trying to do so can lead to high active management costs and frequent portfolio changes. By contrast, as trackers are designed with the sole purpose of reflecting an index as closely as possible, they save the investor management and transaction fees.

Active management means that an investment fund manager compiles an investment portfolio, using his or her own judgement, and then makes strategic changes in that portfolio within the framework of the fund. These changes are aimed at helping the fund outperform the benchmark and other comparable funds. Active management can be successful, of course, but it can also have unfavourable results. Trackers are only designed to follow an index. By eliminating the need for active management, trackers save costs, and because they generally change less than an actively managed fund, transaction costs are lower as well.

Passive management consists of administrative activities such as processing dividends, implementing share splits and ensuring the portfolio always corresponds to the reference index.

Trackers are relatively new in Europe, but they were first introduced in the United States in 1993, where they are now a huge success. After their introduction, trackers have quickly become popular in Europe too. At present, more than 120 trackers are traded in Europe, with a combined market value of just above 10 billion.

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Trackers are issued by fund managers.

The value of a tracker is primarily determined by the level of the reference index. Accumulated dividends and management fees also play a role, as do buy and sell orders in the market. The tracker price is usually a fraction of the level of the reference index. For example, if the level of the index is 500, and one tracker relates to one-tenth of the index, the price of a tracker will be about € 50.

You can buy trackers through your bank or broker, which will put your order through to Euronext.

The ordinary transaction fees that apply to shares also apply to trackers. Fees vary from one intermediary to another.

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Since trackers are passive managed funds, low management fees are deducted on the performance of the fund.

The minimum order size is one tracker share

Euronext offers investors in trackers the same guarantees as shares.

·          Euronext monitors all transactions closely and can cancel transactions or even temporarily suspend trading in a tracker if it suspects any irregularities. As with shares, there is a limit on the level of price fluctuation that is allowed.

·          For every transaction, the system checks whether the seller has the necessary trackers and the buyer has the required funds, thus eliminating the risk that either party will fail to fulfil their obligations.

Click here for a complete list of trackers.

That depends on the purpose of your investment. Euronext never offers investment advice, but has devel oped a search tool to help you selecting the right tracker based on the following criteria : exposure, index type, product family, index family, sector, PEA (French savings fund).

You can also fine-tune your search by looking at our different sections per product, which will give you additional information such as expense ratio, dividend treatment, liquidity, turnover, etc.

Go to Trackers

A tracker is a share and not a derivative, such as an option or a warrant. There is no expiry date, so you can keep your trackers for as long as you want.