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GOLD WINNER ISHARES Australians can get a stake in the world’s great technology companies
The iShares S&P 500 exchange traded fund wins this year for providing low-cost access to the top 500 companies in the US, including Apple, Microsoft, Amazon, Berkshire Hathaway, Facebook, JP Morgan Chase & Co, Johnson & Johnson, Alphabet and Exxon Mobile.
The US sharemarket soared in the year to the end of September before being sold down in October. The hedged version of the ETF (fee 0.10%pa) performed better than the unhedged version (0.04%pa) over the past year because of the strength of the US dollar.
Twenty-six per cent of the iShares S&P 500 ETF is invested in information technology companies such as Apple, Microsoft, Amazon and Facebook – a sector that is largely missing in the Australian sharemarket.
iShares originally cross-listed its S&P 500 ETF on both the Aus- tralian and US sharemarkets but in the second half of 2018 it converted it into an Australian-domiciled fund ETF, removing the need for investors to complete a US tax form known as W-8BEN.
In second place is Magellan, with a global equities exchange traded product that is actively managed. Magellan has pulled back its exposure to US sharemarkets to 46%, with 15% in emerging markets, 12% in western Europe, 17% in cash and 9% in the rest of the world. It charges a rather high 1.35%pa.