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Vanguard FTSE Emerging Markets Shares

Fund Manager: Vanguard
Inception Date: Nov 01, 2013

If 2015 was a year to forget for most investors, 2016 was certainly a year to remember, with global sharemarkets rallying, particularly in the back half of the year. Conversely investors in cash and fixed interest assets suffered with cash rates remaining at or near record lows and the threat of future increases in interest rates impacting returns on fixed interest assets. Back when we first launched ETF Watch, we developed the hypothetical lowest cost ETF portfolio available on the ASX, ... [More]

Returns from shares in emerging markets have been weak since the global financial crisis; the iShares MSCI Emerging Markets ETF (ASX: IEM) has a 5-year average annual return of 1.1%, and 1.48% over 10 years. As the ETF does not use currency hedging, Australian investors are exposed to movements in the underlying currencies. This means the weak Australian dollar has cushioned investors from some of the poor performance – by comparison, the USD version of the same ETF has had an average annual return of -4.71% for the last 5 years. Much like the Australian market, emerging markets have been hurt by soft commodity prices and a slowdown in China. The following chart shows how closely the ETF of emerging markets has tracked with the S&P/ASX 200 (Index:^AXJO) (ASX:XJO), with both underperforming the iShares Core S&P 500 ETF (ASX: IVV) considerably. [More]

2015 certainly was not a year to remember for most investors with global share markets ending the year pretty close to where they started. Nevertheless, last year we put together our Lowest cost ETF portfolio available on the ASX.  This showed that a diversified ETF portfolio could be invested in with management fees between 0.21% and 0.27% depending on the risk tolerance selected. Now that we’ve got through 2015 it’s time to look at how that portfolio performed in 2015. ... [More]

How to invest in emerging markets

Financial Review - Jan 29, 2016

Investors typically use specialist managed funds for emerging markets exposure, but a growing number of exchange traded funds and listed investment companies also provide exposure, and online brokers are making it easier to buy offshore shares directly. Here are four strategies to consider. [More]

If you ask a proponent of Exchange Traded Funds (ETFs) why they like ETFs, without a doubt the conversation will soon move to their low cost nature.  It’s true that the majority of ETFs are more cost effective than alternative funds.  This is generally due to the fact that in most cases ETF investors are not paying expert fund managers to outperform the benchmarks, rather the investor is paying for operational efficiency to ensure performance in line with the benchmark. If we ... [More]

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