Why ETfs ? | ESG ETF Portfolio Management Solution SWM

ETFs: EXPONENTIAL GROWTH

ETF stands for Exchange Traded Fund. An ETF is a listed fund which can be bought and sold on a stock exchange, just like a share. Since their origin in the 1990’s, ETFs have witness exponential growth. At end Dec 2019, there was over USD 6 trillion invested worldwide, in over 7000 different ETFs.

The first ETF was launched in Canada in 1990. Since then, the low-cost, flexibility and transparency of ETFs has led to enormous growth in the assets invested in these instruments.

ETFs replicate the performance of an underlying index, for example the S&P 500 equity index in the USA. ETFs are available on indices of equities, bonds, commodities and other asset classes. Using ETFs, it is possible to gain exposure to virtually any asset class, country, sector or investment style globally. As of end 2019, there were over 7,000 different ETF available.

What are the advantages of ETFs?

ETFs will replace traditional mutual funds over time. Total asset in Exchange Traded Products (ETPs) have grown from USD 1 billion 17 years ago to USD 6 trillion at the end of December 2019 (source: ETFGI).

Using ETFs, we can construct a low-cost portfolio for you which exactly matches your risk profile. It will be a fully-diversified ETF portfolio, covering the major asset classes, geographic regions and investment styles.

“ETFs continue to break records. As of end 2019, the total invested in ETFs and ETPs (Exchange Traded Products) reached 6 trillion US dollars. Already during 2015, ETFs overtook hedge funds, measured by total assets managed.”

Interested?
We have written a guide to ETFs especially for you.

LOW-COST

Offering better value than traditional funds, ETFs typically cost investors 0.1% – 0.2% per annum. Using ETFs, we construct ready-made portfolios for your clients.

LIQUIDITY

ETFs are highly liquid, meaning there are high trading volumes and they can be bought and sold even in times of market turbulence. All our portfolios offer 24-hour encashment.

DIVERSIFICATION

ETFs can reduce the overall volatility of your portfolio through diversification. Our ETF portfolios are all globally diversified amongst asset classes (equities, bonds, commodities etc.).

TRANSPARENCY

ETFs are completely transparent with regard to their holdings,

their performance and their costs.

You can always see exactly what your clients own.

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