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With their popularity and consumer interest growing in exchange traded funds (ETFs), it’s imperative for financial advisers to be on top of their game. How does a financial adviser construct a portfolio that uses ETFs as the building blocks for successful returns?

As at end-August 2021, ETFs with a market capitalisation in excess of R113bn were traded at a YTD average daily value in excess of R310m on the JSE. The total value of trades sits at more than R50bn.

“ETFs continue to offer a significant value proposition for novice and astute investors in an economic environment that remains difficult to navigate,” says Adèle Hattingh, business development and exchange traded products manager at the JSE.

The popularity of ETFs is growing: they’re efficient, relatively inexpensive investment vehicles, and they offer higher levels of liquidity and transparency than many other funds. And because they can be traded like any other stock, they’re a great offering for investors.

With a wide variety of ETFs — 85 on the JSE (as at September 9 2021) — available: equity, bond and fixed income, commodity, currency, speciality and factor, a solid understanding of their unique features will give financial advisers the edge when it comes to constructing well balanced client portfolios, particularly during the volatile economic times in which we live.

Picture: 123RF/DANIIL PESHKOV
Picture: 123RF/DANIIL PESHKOV

They offer higher levels of liquidity and transparency than many other funds

Join the BDFM Investment Dialogues, in association with the JSE, for the second of a two-part series geared towards financial advisers — for a thorough dissection of ETFs and the benefits that can be derived from each.

An expert panel will examine the various ETF types and provide financial advisers with a firm understanding to be able to make judicious comparisons in terms of structure, total expense ratios and the underlying security options on which they rest.

Moderated by award-winning financial journalist Fifi Peters, you’ll hear from experts, including:

  • Gareth Stobie, CoreShares MD;
  • Maurice Madiba, Cloud Atlas Investing MD;
  • Grant Locke, head of OUTvest; and
  • Thato Matsafu, JSE head: primary markets.

Date: Thursday September 16 2021
Time: 9am-10am


Watch part one of the two-part series geared towards financial advisers below:

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