House Prices

ETFs offer easy entry to exciting markets

The controversy over the high cost of managed share funds may lead to consideration of ETFs (exchange-traded funds), which offer low costs (usually 0.75%) and entry to different and exciting markets.

Friday, July 16th 2004

ETFs are essentially index funds that trade like shares on major stock exchanges. They were launched in the US in 1994 and now have a market value of $US150 billion ­ only a fraction of the $US7.5 trillion held in funds but growing quickly.

They are attractive because they are low-cost passive funds that track various indices. Their attractions also include high liquidity.

They trade continuously during market hours and allow investors to lock in a price at any moment. Other funds in contrast are priced once a day using the closing price of their stocks.

ETFs offer wonderful diversification. Investors can buy products designated by industry or country, growth or income. Many opt for an ETF that tracks Wall Street's most important index, the Standard & Poor's 500. The advantage is that fees have been honed down to as little as 0.09%.

The S&P500 iShare is a transparent investment; its price is quoted throughout the day and investors can also follow it on the futures market.

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Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
China Construction Bank 6.75
TSB Special 6.75
ICBC 6.75
ANZ Special 6.79
ASB Bank 6.79
AIA - Go Home Loans 6.79
Kiwibank Special 6.79
BNZ - Classic 6.79
Unity 6.79
Westpac Special 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
ASB Bank 6.55
AIA - Go Home Loans 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

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