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ETFs with a different geographical focus

Many investors do not take advantage of diversified Exchange Traded Funds (ETFs) when they create a strategic asset allocation for their portfolio and the need for diversification.

Below is an explanation of what an ETF is and also five ETFs with a different geographical focus.

What is an ETF?

An ETF, or exchange traded fund, is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange. ETFs experience price changes throughout the day as they are bought and sold. ETFs typically have higher daily liquidity and lower fees than mutual fund shares, making them an attractive alternative for individual investors.

Because it trades like a stock, an ETF does not have its net asset value (NAV) calculated once at the end of every day like a mutual fund does.

iShares MSCI WORLD ETF (Geographical focus: Global)

iShares MSCI World ETF is an exchange-traded fund incorporated in the USA. The ETF seeks to track the performance results of the MSCI World Index.

The top five holdings in the index include Apple, Microsoft, Exxon Mobil Corp, Johnson & Johnson and Amazon.com. Together representing 6% of in index.

iShares MSCI Emerging Markets ETF (Geographical focus: Emerging Markets)

iShares MSCI Emerging Markets ETF is an exchange-traded fund incorporated in the USA. The ETF tracks the performance of the MSCI TR Emerging Markets Index. The ETF holds emerging market stocks that can predominantly be classified as large and mid-cap. It weights the holdings using a market capitalization methodology and rebalances quarterly. 

The top five holdings in the index include Tencent Holdings Ltd, Samsung Electronics Co Ltd, Taiwan Semiconductor, Alibaba Group Holding Ltd, and China Mobile Ltd. Together representing 15% of in index.

iShares EURO STOXX 50 UCITS ETF (Geographical focus: Eurozone)

iShares EURO STOXX 50 UCITS ETF (DE) is an open-end UCITS compliant exchange traded fund incorporated in Germany. The fund aims to track the performance of the EURO STOXX 50 index. The fund distributes income received to shareholders.   

The top five holdings in the index include Total SA, Anheuser-Busch InBev SA, Siemens AG, Sanofi and Bayer AG. Together representing 22% of in index.

iShares Core FTSE 100 UCITS ETF (Geographical focus: UK)

iShares Core FTSE 100 UCITS ETF (Dist) is an open-end, UCITS compliant exchange traded fund incorporated in Ireland. The Fund aims to track the performance of the FTSE100 Index. The fund distributes income received to shareholders.   

The top five holdings in the index include HSBC Holdings plc, British American Tobacco plc, BP plc, GlaxoSmithKline plc and Royal Dutch Shell plc. Together representing 25% of in index.

iShares S&P 500 ETF

iShares S&P 500 ETF is an exchange-traded fund incorporated in the USA. The ETF tracks the performance of the S&P 500 Index. It invests in all 500 stocks that comprise the index. The ETF holds predominantly large-cap stocks from U.S. companies. It weights the holdings using a market capitalization methodology and rebalances quarterly. 

The top five holdings in the index include Apple, Microsoft, Exxon Mobil Corp, Johnson & Johnson and Amazon.com. Together representing 11% of in index.

 

This article was issued by Kristian Camenzuli, Investment Manager at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. 

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