Increasing “ownership” of investment decisions is lifting the popularity of exchanged traded funds (ETFs) within the SMSF industry, according to Russell Investments.
Russell Investments portfolio manager Scott Bennett told SMSF Adviser that investors are taking greater control over their assets, which is being seen in the growth of the SMSF industry.
Furthermore, these investors are controlling their wealth by implementing traditional stock options themselves.
“We’re seeing a growing number of investors start managing their super or their assets on an unmediated basis,” Mr Bennett said.
“So, in terms of the role of advisers, we’re seeing investors take a lot more ownership of that investment decision, and when they increase their ownership they usually are doing that by implementing traditional stock options.”
“One of the great things about ETFs is that they actually trade on the Australian Securities Exchange (ASX) so it’s quite easy for an investor to actually hold that allocation, because it trades on the same basis as the rest of their portfolio.”
Mr Bennett said that SMSF trustees, along with retail investors, make up a majority of ETF investors in the Australian market.
ETF traits such as lower fees than managed funds, access to franking credits and tax efficiency are part of the reason why SMSF investors continue to grow in the ETF space.
Mr Bennett said he expects the momentum in the ETF industry to continue through 2013.
“Across our broad suite of ETFs, we’ve seen tremendous pick-up in terms of volume throughout 2013 and I think we kind of expect to see that continue to come on board just as investors are more willing now to take on a bit more equity risk in their portfolio,” Mr Bennett said.
“So as we start to see that money come back in, we’ll continue to see the growth of ETFs.”
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 26 Sep 2017ATO set to add new items to SMSF watch listBy Katarina Taurian
- 26 Sep 2017ATO tipped to scrutinise property development and unit trustsBy Jotham Lian
- 26 Sep 2017Statistics reveal full impact of events-based reportingBy Staff Reporter
- 26 Sep 2017Tax advice exemption discrepancy driving away accountantsBy Jotham Lian
- 26 Sep 2017Consultant flags strategies to negate complex ECPI calculationsBy Miranda Brownlee
- 25 Sep 2017Survey results point to major concerns with new reportingBy Miranda Brownlee
- view all
- ATO tipped to scrutinise property development and unit trusts
One big four accounting firm says the ATO has started to zoom in on property development in unit trusts being held in SMSFs and the calculat...read more
- Statistics reveal full impact of events-based reporting
Analysis conducted by SMSF software provider BGL Corporate Solutions has indicated that around 290,000 SMSFs will be affected by the events-...read more
- Tax advice exemption discrepancy driving away accountants
A discrepancy in ASIC’s treatment of licensed and unlicensed accountants in relation to the tax advice exemption instrument is driving acc...read more
- view all