HOW TO IN­VEST IN OFF­SHORE SHARES

Money Magazine Australia - - INVESTING MANAGED FUNDS -

Aus­tralians usu­ally in­vest in in­ter­na­tional shares in one of three ways: us­ing a bro­ker, through a man­aged fund or through an ex­change traded fund (ETF). Most bro­ker­age firms or on­line broking ser­vices can trade shares listed on ma­jor in­ter­na­tional ex­changes but di­rect in­vest­ing in in­di­vid­ual in­ter­na­tional shares is sig­nif­i­cantly more ex­pen­sive than in­vest­ing in Aus­tralian shares, warns ASIC’s Mon­eySmart web­site. Costs can in­clude bro­ker­age, cur­rency con­ver­sion fees, for­eign se­cu­rity cus­tody fees and in­ter­nal trans­fer fees. Some man­aged funds fo­cus on in­ter­na­tional shares, per­haps spe­cific re­gions or in­dus­try sec­tors, while oth­ers sim­ply in­clude in­ter­na­tional shares as part of a di­verse mix of as­sets. Fund man­agers may have strate­gies in place to limit the im­pact of ex­change rate move­ments on your in­vest­ment, says Mon­eySmart. ETFs, which are traded on the ASX, can be a cost-ef­fec­tive way to gain ex­po­sure to in­ter­na­tional shares. “But it’s im­por­tant that you read the prod­uct dis­clo­sure state­ment (PDS) to know what you’re in­vest­ing in and the risks in­volved,” says Mon­eySmart.

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