Using our pre-defined selection criteria and best execution principles, we regularly survey the landscape of over 2,000 global ETFs and invest in ETFs that are broad-based and have a long-term outlook. We invest in a range of ETFs across various asset classes, including equities, fixed income, foreign currency, commodities and alternatives. Having chosen the asset class, region or market segment we want exposure to, we will then select the most liquid ETFs in each category.
Of course, we are passive buy-and-hold investors and look to ETFs that accurately track their relevant markets; rather than relying on active management.
This means ETFs with high trading volumes, low bid/offer spreads and minimal tracking error. We also pick ETFs with low total expense ratios and only invest in ‘physical’ ETFs, which either replicate the index they are tracking in full or sample a proportion of it.
We avoid ‘synthetic’ swap-based ETFs entirely, which are more complex instruments that use derivatives - and not the actual assets - to track an index, and can expose investors to additional risks.
From time to time, we may switch an ETF in your investment mix for a superior ETF – ensuring continued optimum performance at the lowest cost. And to ensure we remain at the forefront of investment trends, our whole selection process is under continual review.