Australian Finance Podcast
ETFs 102: index funds, factors, smart beta & quality investing, ft. Betashares' Tom Wickenden
Oct 2, 2024
Tom Wickenden, a representative from Betashares, specializes in factor investing and ETFs. He dives into the fascinating world of smart beta and contrasts it with traditional index funds. The conversation also covers the Betashares Australian Quality ETF, focusing on investing in high-quality companies. Wickenden shares insights on the long-term performance of ETFs compared to gold and the importance of diversification. He emphasizes how financial literature shapes investment perspectives and encourages proactive research in the ever-evolving market.
35:40
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Quick takeaways
- Maintaining a diversified portfolio through low-cost ETFs is essential for long-term wealth growth and risk management.
- Smart beta investing leverages specific factors to enhance portfolio performance, focusing on high-quality companies for better risk-adjusted returns.
Deep dives
Staying Invested Through Diversification
Maintaining a diversified portfolio is crucial for long-term wealth growth. Low-cost, broad-based ETFs serve as foundational elements in achieving this diversification, allowing investors to gain exposure to various asset classes with minimal fees. For instance, ETFs such as AAA, which offers high-interest cash exposure, and A200, representing the top 200 Australian companies, are designed to cater to core portfolio strategies. By regularly reviewing and maintaining a diversified allocation, investors can better manage risk and navigate market fluctuations.
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