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Index Funds - Australian or Overseas?

Discussion in 'Exchange Traded Funds (ETF)' started by rookie67, 8th Sep, 2008.

  1. rookie67

    rookie67 New Member

    2nd Sep, 2008
    Horsham, VIC
    I have been reading a bit about investing in index funds, which basically promise returns identical to the share market (less fees). Does anyone have any experience with these funds over a reasonable period of time?
    It seems to me that saving and investing into these funds is a fool-proof way of earning reasonable returns inthe long-term, but I'm a bit unsure as to how to invest into these funds here or overseas?
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    9th Jun, 2005
    Sydney, Australia
    Here in Australia there are two main index tracking Exchange Traded Fund (ETF) offerings - you can invest in a number of local share funds from SSgA: SPDRS Australia Exchange Traded Funds, ETFs ... or quite a few international share funds from iShares ETFs for Australian Investors

    You buy and sell units in these funds just like you would buy shares on the stock exchange - they all have their own ASX code, and you just go to your broker to buy and sell.

    It is worth using these funds as a benchmark for more actively managed funds - you may well find that many funds which claim to add value above and beyond what the market does ... actually fail to do so over the long term (which means you would have been better off just buying the index).

    Unfortunately I don't have full ETF data available on Compare Funds :: Managed Fund Comparison Charts and Statistics yet, but I'm working on it so you will be able to do easy comparisons.

    There are also ordinary managed funds (not exchange traded) which offer index tracking - Vanguard being the most well known. Quite a few fund managers offer index tracking funds - you'd need to shop around and compare results (and more importantly fees).