ETF Trends
ETF Trends

If you’re looking for reasons to consider Australia’s exchange traded funds (ETFs), try this on for size: over the last century, its stock market has outperformed all others and offered the lowest volatility.

Digging deeper, it’s easy to see why.

  • Australia’s economy has benefited well from its proximity to and relations with Asia, as well as its stable and cautious financial system. Australia has a handful of large banks which are known to be highly conservative and straightforward, and  Aussie banks are among the world’s best performers; they were hardly influenced by the global financial crisis, reports Kevin Grewal for Seeking Alpha.
  • While merger and acquisition (M&A) activity in Australia has slowed this year, don’t expect that to last. Sharat on MoneyAU reports that many bankers believe that the number of opportunities that occur for Australian companies invest internationally through a merger or an acquisition will only increase, since there has been extensive consolidation already, and the number of domestic opportunities are limited. [Australia Gets OECD Stamp Of Approval.]
  • CNBC reports that Australian Prime Minister Julia Gillard’s political campaign has officially launched, and she promises to create more jobs, cut company tax and improve education and health via a national broadband network. Her argument is not to leave the economy’s fate to conservative opposition leader Tony Abbott. [Why Australia’s ETF Zigs While Others Zag.]
  • Australia has notched 17 consecutive years of economic growth, on average growing 3.3% each year, according to its government.
  • The country ranks first in the Asia-Pacific region for labor, agricultural and industrial productivity per person working.

The above facts about Australia’s economy is sure to impact the short term movements of the market and shares, however, the country is poised to succeed and grow over the long term.

Visit our Australia page for more stories on this continent. A few of the ways you can get access to this more stable developed economy include:

  • iShares MSCI Australia (NYSEArca: EWA)
  • IQ Australia Small Cap (NYSEArca: KROO)
  • WisdomTree Pacific ex-Japan High-Yielding Equity (NYSEArca: DNH): 90% of the fund is Australia
  • First Trust ISE Global Copper (NASDAQ: CU): Australia is 12%
  • Market Vectors Junior Gold Miners (NYSEArca: GDXJ): Australia is 13%

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.