Investors can get easy access to a wide range of global ETF products courtesy of iShares. The provider now offers ETFs on the MSCI South African, Australian and Canadian stock indices. All of these countries have large quantities of natural resources, and using ETFs to trade their local stock indices is a good way to get exposure to oil, gold and timber. Investors can benefit from demand for commodities from emerging markets. South African gold producers are also well placed to benefit from investor demand for safe-haven assets like gold.
UTILITIES ETFS ARE A HIT
The flow of funds into European equity ETFs during the week ending 26 February were nearly £46m, according to BlackRock, the asset manager. The largest inflows were into the media sector, which recorded £24m of inflows. In contrast, telecommunications registered net outflows of nearly £30m. Since the start of the year, the utilities sector has been the most popular ETF investment, with £123m of net inflows, as investors search for exposure to defensive stocks. Likewise, telecommunications has been the least popular sector, suffering £198m of net outflows.
FIXED INCOME FLOATING RATE NOTE
The Royal Bank of Scotland (RBS) launched a Euribor floating rate note last month. A floating rate note is a bond with a variable coupon. It will depend on the European Interbank Offered Rate (Euribor), which is the rate at which banks can lend to each other within the Eurozone. This product also has a floor, and will pay investors a minimum return. Floating rate notes are a hedge against rising interest rates because when interest rates rise, bond prices fall. The benefit of the floor is that it limits how exposed you are to a fall in the price of the bond.