Monday, June 04, 2007

More On ETFs

The brilliant thing about ETFs is its like a unit trust or mutual fund. Most funds have an expense ratio of 0.75%-2% p.a. and it comes out of your returns. ETFs have a much lower expense ratio between 0.1%-0.8%). The other thing is that one does not have to trouble themselves with tax and dividend issues as the ETFs will use the funds to buy more shares. You can trade in and out of ETFs like stocks. ETFs are good if you can pick the right sector or country exposure, without having to do actual stock picking: which can be time consuming and hard to get right. ETFs are made for genuine top-down investors.

Examples of current ETFs on Nasdaq:

Sector ETFs


US Oil Fund ETF

Oil Equipment ETF

Semiconductor ETF

Natural Gas Fund ETF

Gold Trust ETF

Base Metals ETF

Precious Metals ETF

Silver Trust ETF

New Types

Hedge Fund ETF

Corporate Credits ETF

Fixed Income ETF

Global Water ETF

Quant ETF

Overbought/Oversold Currency ETF

Dividend Paying ETF

Dermatology ETF

Clean Energy ETF

There are hundreds, if not thousands of ETFs on Nasdaq alone. Then there are the country specific ETF, yes there are Malaysia ETFs on Nasdaq. So, back to the Bursa, its not as simple as it sounds. Size is an important factor and then depth of market. When you can get the size right and product is unique/viable, the buyers will come. Chicken or egg? Best solution, Asia based regional sector ETFs have the best chance of succeeding in Asian bourses. It will be deep enough in size and attractive in terms of exposure for international investors.


Jomaropol said...

As the sun sets, James Bond's hand will be forced on the discmaker by the coldness of the big city.

rask3 said...


jomaropol: discmaker? what's that? I thought he'd be more likely to reach for something hot and heaving. :)

Okay, for me, as an average guy, stocks are already risky enough. I don't need side bets like ETFs, call warrants and other derivatives. For those with lotsa money to splash around and have the risk apettite, well, have a party.


Jomaropol said...

i was thinking of the word discworld to make it more cryptic, but then again maybe not. :)

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