BetaShares - Wealth Builder Nasdaq 100 Geared (30-40% LVR) Complex ETF (GNDQ.AX)

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BetaShares - Wealth Builder Nasdaq 100 Geared (30-40% LVR) Complex ETF (GNDQ) offers investors a pathway to long-term wealth accumulation through moderately leveraged exposure to the performance of the Nasdaq 100 index. The fund operates by pooling capital from investors and supplementing it with borrowed funds, then investing the combined sum into the BetaShares Nasdaq 100 ETF (ASX: NDQ). NDQ's objective is to track the returns of the top 100 non-financial companies listed on the Nasdaq exchange, before accounting for fees and expenses. The gearing, or leverage, within the fund is managed internally. On any given day, the fund's gearing ratio—which represents the total borrowed amount as a percentage of its total assets—is generally maintained between 30% and 40%. It's important to note that GNDQ itself is not designed to track a specific index. Gearing is a strategy that involves using borrowed capital to increase the size of an investment beyond one's own funds. While this can magnify potential investment gains, it equally amplifies potential losses. With its 30% to 40% gearing ratio, GNDQ is expected to provide an effective market exposure ranging from approximately 143% to 167% of its Net Asset Value (NAV) on a daily basis. The fund's portfolio exposure is continually monitored and adjusted to remain within this target range. However, investors should understand that GNDQ's returns over periods longer than a single day may not necessarily fall within this daily targeted range. This is primarily due to the constant rebalancing required to maintain the daily geared exposure, the compounding effect of investment returns over time, and the influence of fees and costs. Consequently, returns over extended periods can differ significantly, both in magnitude and direction, from the daily target geared return. This divergence typically becomes more pronounced in volatile market conditions and over longer holding periods. Due to the combined effects of rebalancing and the compounding of investment returns, investors should not expect GNDQ's Net Asset Value to correspond to a specific level of the underlying share market or portfolio at any given time. Investors are advised to regularly monitor their investment to ensure it continues to align with their financial objectives. Gearing intensifies both gains and losses and may not be a suitable strategy for all investors. Those considering geared investments must be prepared for higher levels of investment volatility and potentially substantial fluctuations, both positive and negative, in their investment's value. Geared investments inherently carry significantly higher risk compared to non-geared alternatives, making an investment in GNDQ high-risk by nature.