An ETF is an open-ended investment fund that is traded on the ASX – just like any share. ETFs aim to closely track the performance of a given index or asset class, so ETF investors can gain exposure to a range of investment strategies, geographic regions and asset classes, often at lower costs than a traditional fund manager. ETFs and can be bought as simply as buying a share on the ASX during the trading day. ETFs are also eligible to be bought inside Self-Managed Super Funds.
GOLD offers an exposure to physical gold assets by providing a return equivalent to the movements in the gold spot price less the applicable management fee. GOLD is backed by physical allocated gold held by HSBC Bank plc (the Custodian). Each share represents a beneficial interest in approximately 1/10th of one fine troy ounce of physical gold.
Gold is often considered as a safe haven in times of volatility and economic uncertainty. Gold also can be used as a hedge against potential inflation. Spot gold price has been surging from last September. Currently, the fund size is $664.16 million, as of 31 Jan 2019.
BEAR gives investors a simple and accessible way to obtain ‘short’ exposure to Australian market. A 1% fall in the Australian market on a given day can generally be expected to deliver a 0.9% to 1.1% increase in the value of the Fund (and vice versa). Management cost of this ETF is 1.38% p.a., with net assets of $41,451,875 as of Feb 1st, 2019. This is a great investment tool for anyone who is feeling ‘bearish’ about the Australian stock market, as often shorting stocks is a difficult process to an ordinary investor.
A200 exposures to the largest 200 companies listed on the ASX, based on their market capitalization. Management costs of this ETF is only 0.07% p.a., the lowest cost Australian shares ETF. As Jan 31st, the Net Assets of A200 is $384,786,882 as of Feb 1st, 2019. Also, this ETF is scheduled to distribute quarterly.
AAA help investors to exposure to assets are invested in bank deposit accounts with selected banks in Australia. AAA provides a monthly distribution of regular income returns. Management cost is 0.18% p.a., with net assets of $1,324,045,792 as of Feb 1st, 2019.
VAP tracks the return of the S&P/ASX 300 A-REIT Index. The ETF provides a low-cost way to invest in property securities listed on the ASX. The property sectors in which the ETF invests include retail, office, industrial and diversified. Management cost of this ETF is 0.23% p.a., and the top 10 holdings represent 83.3% of this ETF. Top 10 holdings are: 1. Scentre Group 2. Goodman Group 3. Dexus 4. GPT Group 5. Stockland 6. Vicinity Centres 7. Mirvac Group 8. Unibail-Rodamco-Westfield 9. Charter Hall Group and 10. Shopping Centres Australasia Property Group
In conclusion, ETFs are a great investment tool you can use to gain exposure to various indexes, sectors and geographic regions at low costs. The benefit of using ETFs are that they are much more cost effective in comparison to a traditional fund manager. They also provide the benefit of not needing to select individual stocks and allocating a portfolio weight to them, which in turn can save a lot of time and money.