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
Australian equities manager Datt Capital has built a retail-friendly version of its small-cap strategy for advisers, previously only available for wholesale investors.
The dominance of passive funds is having a knock-on effect on Australia’s M&A environment by creating a less responsive shareholder base, according to law firm Minter Ellison.
Morningstar Australasia is scrapping its controversial use of algorithm-driven Medalist ratings in Australia next year and confirmed all ratings will now be provided by human analysts.
LGT Wealth Management is maintaining a neutral stance on US equities going into 2026 as it is worried whether the hype around AI euphoria will continue.
