International equity ETFs lure Aussies away from domestic bias
Three in four Australian investors are looking to invest in international equity exchange-traded funds (ETFs) in the next 12 months, VanEck reports.
The firm’s latest VanEck Australian Investor Survey 2024, which canvassed over 3,500 individual investors, discovered that more Australians than ever are eyeing out overseas investments to expand their portfolio.
Over three-quarters (77 per cent) of Australian investors are planning to invest in international equity ETFs in the next 12 months, representing a 27 per cent rise compared to last year.
Meanwhile, approximately 70 per cent are looking at their home soil for ETF investment opportunities. This is the first time that international equities have topped the consideration list, overtaking Australian equities, VanEck noted.
“The Australian investor profile is changing. Australians have historically demonstrated a home bias in their portfolios, despite the domestic market representing only a small portion of the opportunities available in the global investment universe,” described Arian Neiron, VanEck Asia-Pacific CEO and managing director.
“The increasing desire to include offshore exposure aligns with the rapid growth of ETFs in the Australian market which offer access to nearly every asset class and market around the world.”
Recent data from ASX and Vanguard found that international equity ETFs have continued to encompass the lion’s share of the broader Australian ETF industry’s growth. International equities accounted for 60 per cent of the total $12.7 billion ETF flows for Q3.
“The appetite for international equity ETFs by investors is not subsiding and continues to outpace the inflows into Australian equity ETFs and other industry segments,” commented Adam DeSanctis, Vanguard head of ETF capital markets for Asia-Pacific, earlier this month.
Additionally, VanEck’s research pinpointed two key sectors that respondents are considering for future investments. Approximately 51.5 per cent of Australian investors are considering investing in technology in the next 12 months and 38.4 per cent are looking at healthcare.
Betashares launches new ETF
The investment manager’s research coincides with a new product launched by Betashares on 17 October.
The Betashares Wealth Builder Nasdaq 100 Geared (30-40 per cent LVR) Complex ETF (GNDQ) is the latest addition to the firm’s wealth builder range of ETFs. These are designed to enhance access to the benefits of gearing as part of an investor’s long-term wealth creation strategy.
GNDQ offers investors with a moderately geared exposure to the Nasdaq 100 Index, which includes some of the world’s largest and most innovative companies such as Apple, Amazon, Netflix and Nvidia.
According to Betashares, the new fund builds on the success of its flagship Nasdaq 100 ETF (NDQ) that has grown to hold over $5 billion in assets since inception.
“Our wealth builder range is designed to provide investors with the opportunity to build wealth over the long term by offering cost-effective and convenient access to gearing. GNDQ allows Australians to invest in world-leading companies in the Nasdaq 100 through a professionally managed geared exchange traded fund,” said Alex Vynokur, Betashares chief executive.
AUTHOR
Jasmine Siljic
Recommended for you
Some 42 per cent of CEOs say they are actively reinventing their business to stay relevant in the next decade, with consumer services the most common choice for asset and wealth managers.
Former Ophir Asset Management chief executive, George Chirakis, has joined private equity manager Scarcity Partners, while the asset manager has appointed a replacement from Macquarie.
Australian Unity has appointed a fund manager for its Healthcare Property Trust, joining from Centuria Healthcare, as it restructures the product with a series of senior appointments.
Financial advisers nervous about the liquidity of private markets funds for their retail clients are the target of fund managers launching semi-liquid products which offer greater flexibility and redemptions.
