Australian ETF News
Exchange Traded Funds (ETFs) in Australia have been in the spotlight lately – mostly because of the huge interest they have been attracting from foreign investors. What makes Aussie ETFs such good investments at the moment – and how easy it is it include them in your SMSF?
Australia – land of optimism for ETF investors?
After a slow but steady start to the year, the Australian ETF market enjoyed a bumper month in June as US investors poured $250 million into local funds in a single week. Australia’s interest rates, which are still high by developed world standards, and the rebound in commodities prices appear to have given foreign investors renewed confidence in Aussie ETFs – and it would seem that local investors are starting to take notice.
Investing in ETFs – what are you actually buying?
There are more funds in the world than there are hours to research all of them – and for many investors, choosing the right fund can be a huge challenge. ETFs make things simple by tracking the performance of a specific market index or a sector. In other words, when you invest in an ETF, you’re buying a tiny chunk of all the shares in an index.
The ASX 20, 50, 100, and 300 are just some of the indexes that are available to ETF investors – you can also opt to buy a fund consisting of shares from a certain sector (like mining or finance), or hedge against fluctuations in the Australian Dollar by investing in foreign markets or currencies.
The main advantage of an ETF is that you don’t need to go to the trouble of researching individual shares, buying them, and monitoring the performance of each. This convenience is extremely appealing to busy professionals – but it’s important to find out exactly what shares and currencies are included in an ETF before you buy into it.
What does the future hold?
Predicting the future of financial markets is a tricky business, but as things currently stand it may be a good year to take advantage of the rising tide in Australian ETFs. With commodities showing signs of recovery and interest rates holding steady for the moment, these convenient investments are an easy addition to make to your SMSF.
Contact me today on 0414168327 and let’s set up a one-on-one consultation that could change your financial future.
August 10, 2017
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