Best International Share ETPs
Global sharemarkets, in both developed and developing countries, can provide stunning returns even in the midst of a pandemic
Exchange traded products (ETPs) have been a godsend for investors looking to diversify their portfolio with international exposures, which could previously only be done through a broker or managed fund.
International ETP assets have risen 14% since the beginning of the year and now represent the largest slice of the Aussie ETP market. More than a third of all money invested in the space went to international ETPs.
First place goes to the BetaShares Global Sustainability Leaders ETF. It has blown the competition out of the water with its one- and three-year returns of 26.31% and 21.48% respectively. It’s no surprise then that investors are flocking to this ETF, as they are with other ethical ETFs more broadly.
“This year alone we have seen more than $900 million flow into ethical ETFs, of which more than 40% went into ETHI and its currency-hedged equivalent,” says Alex Vynokur, chief executive of BetaShares.
This fund puts to bed the notion that ethical investing comes at a cost in performance. In fact, the BetaShares fund returned about 17.5% in the year to date (mid-October), outperforming global shares by around the same amount.
Vynokur expects the popularity of ethical funds to continue as the world climbs out of the pandemic-induced recession.
“The crisis is also likely to speed up the rate at which companies incorporate ESG practices into their business activities and dealings with stakeholders. Recent studies have shown that companies that incorporate ESG policies have outperformed the broad market, and we think this may continue as we emerge from the pandemic,” he says.
Further illustrating the strong performance of international ETFs, the iShares Global 100 ETF, which has taken out second place, returned 11.80% in the year to June 30 – a result that any active fund manager would be proud to achieve.
The fund tracks the S&P Global 100 Index, providing investors with exposure to 100 blue-chip companies in developed and emerging markets around the world.
The Magellan Global Equities Fund places third, which is great recognition for an actively managed ETF. The fund invests in 20 to 40 of the world’s best and largest companies.