This month eight new iShares exchange-traded funds from Barclays Global Investors will start trading on the Australian Securities Exchange, offering investors direct access to the US, Euro
This month eight new iShares exchange-traded funds from Barclays Global Investors will start trading on the Australian Securities Exchange, offering investors direct access to the US, European, Japanese, Asian and emerging markets.
BGI plans to follow the launch of its first iShares ETFs in Australia with funds choices in the near future. The eight ETFs are cross-listed from the New York Stock Exchange, have assets under management of more than AUD125bn, and represent exposure to international markets that in aggregate represent around 30 times the total capitalisation of the Australian market (about AUD30trn).
The iShares funds track the S&P SmallCap 600, S&P MidCap 400 and S&P 500 indices of the US market, along with the MSCI Japan, S&P Europe 350, MSCI Emerging Markets and MSCI EAFE (European, Australasian and Far Eastern markets) indices.
‘In the first tranche we have included the S&P Global 100 iShare,’ says BGI Australia chief executive Morry Waked. ‘This offers Australian investors instant exposure to the world’s top 100 transnational companies such as Microsoft and GE, simply by buying one share on the ASX.
‘The Australian equity market represents around 2 per cent of the world’s equity markets, and hence Australian investors will generally be seeking investment opportunities outside their home market. The listing of a range of international iShares on the ASX opens up these world equity markets in our time zone.’
Waked says investors will benefit from much lower charges than with traditional equity funds. While Australian retail investors in international equity funds pay annual management fees and expenses averaging 1.87 per cent of fund assets, the iShares S&P Global 100 has an expense ratio of 0.40 per cent a year.
Barclays Global Investors accounts for half the world’s ETFs with 190 iShares funds traded on stock exchanges around the world, and managed a total of more than USD2.4trn in total assets at the end of June. Sydney-based Barclays Global Investors Australia is one of the country’s leading investment managers with more than AUD45bn in assets under management in June.
