ETFs are becoming an increasingly popular and mainstream investment tool for individual and institutional traders alike. By now, most people know that ETFs can be bought and sold like any share on an exchange (like the ASX), through a full service or online broker. However we often get asked if there is anything else that
The NBA (the American basketball league) Finals has just finished with the San Antonio Spurs defeating the Miami Heat. Plenty has been written on how the two teams play different styles of basketball, but it turns out that there may be some investing lessons you can draw from the characteristics of the finalists.
Markets have shown they can crash unexpectedly – for example, most major share markets have fallen by 50% or more 3 times in the first 10 years of the 21st century. That’s far more than expected by traditional investment theory, which is built around the concept that time in the market is the key to
In our Australian ETF Review for May 2014 we reported that the industry had once again set a fresh record high, reaching $11.4B in funds under management. Total assets under management for the industry grew ~3% this month, an increase of $354m. Highlights of the report are set out below:
The little known, but powerful, reality is that around 80% of returns generated from an investment comes from simply selecting the “right” asset class. In this Portfolio Construction post, we introduce the concept of Strategic Asset Allocation and describe how investors can practically use ETFs in their investment portfolio.
Investors are rightly interested to know about the underlying assets held inside their investment products. Buying individual stocks gives you potential access to dividends and capital growth the company generates. But what about managed funds and ASX traded Exchange Traded Funds (ETFs) – what do they hold? We look further into this issue in this
Our Australian ETF Review for April 2014 reported that the industry had a record month which saw it break through the $11 billion barrier in funds under management. The market grew by 4.3% in the month, and has now grown approximately 50% over the last 12 months. Highlights of the report are set out below:
ETFs in Australia are regulated by the Australian Securities and Investments Commission (“ASIC”) as registered “managed investment schemes” (“MIS”) which means ETF issuers are governed by a detailed and strict set of regulations regarding the management of assets. To understand how safe ETF assets are, we need to understand the MIS rules – the laws
Our post entitled “What is a balanced portfolio and what does it mean for me” briefly explained “core and satellite strategies” using ETFs. In this Portfolio Construction post we look further into implementing a core and satellite strategy in an Australian equities portfolio.
All ETFs in Australia utilise a structure where each investor owns “units” which give an ownership share in the overall assets held by the fund. These ETF units are issued by a “unit trust”, which holds the assets of the fund on trust for investors. The structure used for ETFs is the same structure used