The allure of overseas travel for Australian holiday makers is understandable. While Australia has great beaches and incredible natural wonders, overseas destinations offer ancient cultures, unique celebrations, mountains higher than 2,228 metres and man-made wonders thousands of years old. The affordability of international travel due to increased competitiveness among airlines and falling accommodation costs has made overseas holidays more accessible for Australians.
Likewise, ETFs listed on ASX have made international investing immediately accessible to Australians, without leaving home. ETFs are traded on the ASX, so via one trade investors are instantly accessing a world of opportunities.
The allure of international investing, like travel, is to access opportunities you cannot acquire locally. The Australian share market represents about 3% of the global stock market, so investing internationally opens up 97% of the world that you are missing out on if you only invest in Australian equities. There is no ASX equivalent of Google, Intel, Mastercard or Johnson & Johnson.
Australia is an economy coming off a commodity super-cycle. To access economies that are rapidly changing and are exposed to the trends fuelling global growth, you could just invest in an ASX listed multinational like BHP and hope for some indirect benefit or you could invest in an international equity ETF with exposure to technology and healthcare such as the Market Vectors MSCI World ex Australia Quality ETF (ASX code: QUAL).
The growth in international equity ETFs on the ASX has been extraordinary. In the past 12 months 23 new international ETPs (including ETFs) have been launched and assets under management have increased 75% surpassing $8 billion as at 30 September 2015.
To help investors capitalise on the benefits of international equity ETFs we have launched a new educational webpage including a number of short videos; http://www.marketvectors.com.au/etf-international/
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