Enough is enough. A case for action

iShares

Enough is enough. A case for action

Being frustrated with markets is a dead-end.

Your clients can benefit from investment ideas that can sit alongside your stock picking skills.

So what can I do for my client?

You can help them get off the side-lines and search for return opportunities provided by Exchange Traded Funds (ETFs).

ETFs provide your clients access to the world’s markets and hard-to-reach asset classes.

Global equity valuations appear attractive

Right now, the high AUD is making global shares cheap on a relative basis.

The chart below shows the spread between the Australian and US government 10- year bond yields. Between 2007 and 2012, movements in Australian and US yield spreads and the AUD/USD were broadly correlated.

That relationship appears to have broken down recently. The AUD has stayed high even as the spread between Australian and US bond yields has widened.


iShares global chief investment strategist Russ Koesterich recently confirmed his positive stance on emerging markets and global mega caps Read more here

Valuations for both the MSCI Emerging Markets Index and S&P Global 100 Index are trading below their historic PEs. See charts below. Past performance is not indicative of future performance.



At a glance – key client talking points

iShares S&P Global 100 (IOO)

  • designed to deliver the performance of 100 transnational mega-caps before fees and expenses.
  • largest holdings - Exxon Mobil, IBM, Microsoft, Chevron and GE. US country allocation is 52%.
  • approximately 35% of IOO is comprised of three sectors, IT (14%), healthcare (14%) and consumer discretionary (7%). These sectors are poorly represented in the domestic market.
  • holds physical securities, not derivatives or synthetics.
  • combines transparency, low cost and diversification with the trading flexibility of a listed stock.

Product information


iShares MSCI Emerging Markets (IEM)

  • designed to deliver the performance of 24 emerging-market economies before fees and expenses.
  • over 800 emerging-market companies in one ASX trade.
  • largest holdings - Samsung, China Mobile and Taiwan Semiconductor.
  • holds physical securities, not derivatives or synthetics.
  • combines transparency, low cost and diversification with the trading flexibility of a listed stock.

Product information


If you have any questions please don't hesitate to contact the iShares team on
1300 474 2737.

Regards,
Tim Sparks
National Broking Strategy & ETF Research

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