ETF sector heats up with more products to market
Australia's exchange traded funds (ETF) sector is set to see more activity with the three new products launched by major players with BetaShares launching a US equities ETF and iShares launching a hedged versions of two existing products.
BetaShares will offer its FTSE RAFI US 1000 Index ETF under the Australian Securities Exchange (ASX) code "QUS" which access the largest 1000 securities by 'fundamental value' amongst US-listed stocks.
BetaShares managing director Alex Vynokur believes the launch will provide investors with a way to obtain diversified US equities exposure, with the potential to outperform the market-cap benchmark over the long-term similarly to more active strategies.
"Investors looking for simple, transparent access to the US equities market through an ETF will now have the option of selecting a product that provides broad-based exposure at low cost, while additionally using an intelligent methodology that seeks to avoid the potential of market cap indices to overweight stocks that are overvalued, and underweight stocks that are undervalued", Vynokur concluded.
The two iShares ETFs are hedged versions of its Core S&P 500 ETF and Global 100 ETF and lift its ETF product suite to 28 with Jon Howie, Head of BlackRock's iShares business in Australia stating the two ETFs are constructed by combining the respective unhedged iShares ETF with applicable currency forward contracts.
"With the Australian sharemarket representing just 3 per cent of global markets, it means 97 per cent of the investment opportunity is outside Australia. iShares international ETFs help investors access these global opportunities and provide instant, diversified exposures with just one trade on the ASX," Mr Howie said.
AUTHOR
Priya Prakash
Recommended for you
Grant Hackett has been promoted from CEO of Generation Life to head up the wider Generation Development Group.
Tribeca Investment Partners has made a distribution hire from Australian Ethical in a newly-created role focused on the national intermediary market.
Asset managers may be urged to diversify their product ranges, but investment executives have warned any M&A deal should avoid simply filling gaps and instead consider long-term value creation.
Specialist wealth platform provider Mason Stevens has become the latest target of an acquisition as it enters a binding agreement with a leading Sydney-based private equity firm.
