ETFs will eventually take off, says Tria

ETFs/commissions/platforms/gearing/self-managed-super-fund/

27 July 2010
| By Milana Pokrajac |

Despite recent data to the contrary, Tria Investment Partners managing director Andrew Baker believes exchange-traded funds (ETFs) are playing into a particularly positive environment.

Baker said a world of unbundled product commissions, advisers being under pressure to lower costs and less concessionally taxed super would create perfect conditions to take ETFs into the mainstream.

Baker’s comments come despite evidence showing Australian advisers are not picking up on ETFs, with most of their popularity being positioned with non-advised self-managed super fund investors.

“We do admit it is still early days, but all the anecdotal evidence is showing an increasing number of advisers trying to work out how to use ETFs,” said Baker.

“Most [advisers] make their investments through platforms, and platforms are in the process of upgrading their equity capabilities,” he added.

The size of the ETF category is around $3 billion in a $1 trillion market, but Tria research shows ETF assets grew by more than 60 per cent.

Baker also noted recent clarifications regarding the way in which gearing in super would work — further adding to the ETF category.

“Gearing in super is complicated for equities. You need separate borrowing for each security. If you’re after a diversified portfolio, ETF is going to make gearing in super much simpler,” said Baker.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months 3 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 4 weeks ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

1 week 4 days ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

2 weeks 3 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

3 weeks 1 day ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND