The Best ETFs in Australia
Member Email:
I know you’re big on ETFs these days over individual stocks. So, which ones are the best income and growth ETFs? LNAS comes to mind. I’m sure members would love you writing about it.
Reply:
'Best' is a difficult description for ETFs. Best in what way? Most are self-explanatory, so best is what suits your purpose, although I do take note of two things:
- Market Cap - tells you whether they are popular, liquid, or traded a lot. Ignore tiny ones.
- Active or Passive - I don't generally bother with active ETFs that involve humans. The great benefit of ETFs is to provide access to indices and asset classes you can't access as an ASX investor without them. I don't need some human involved trying to be clever, charging me more than usual to do so. So I avoid those. Our success in timing the market in the Strategy Portfolio has only required us to use a handful of major ETFs (A200, NDQ, IVV, FANG, LNAS, SNAS). It's simple stuff.
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So, best is
big and
liquid and
passively managed, and the most used are those that represent an index rather than a clever theme. You know what they say, by the time they provide an ETF to cover the latest fad... it's over.
Here is my latest up-to-date list of ETFs for you in a spreadsheet. The 'best' ones, in my humble opinion, are on the left.
More about the author – Marcus Padley
is a highly-recognised stockbroker and business media personality. He founded the
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