ETFs – Elements 5


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8 Responses

  1. Avatar John B says:

    It would be a good idea to explain the domicle/reporting status for ETFs, as that confused me when I first started. Get the wrong sort and your capital gains could be considered income, or you could be taxed at source by another country (as some US ETFs are) unnecessarily

  2. Avatar Martin says:

    Hi Mike, although they are cheap and can make overseas markets accessible, ETFs don’t pay any dividend income? Looking at the FTSE 100, it is at the same level as exactly 10 years ago. I’m not sure about other markets, but I would be looking to gain exposure to say China or Emerging Markets within my asset allocation. Although probably more expensive would I not be better off opting for Investment Trusts rather than ETFs? I would be interested to understand in what instances you would opt for an ETF over other instruments such as an Investment Trust.

    • Mike Rawson Mike Rawson says:

      Hi Martin,

      ETFS do pay dividends, based on the underlying investments.

      In an ideal world, I would be 50% passive (ETFs) and 50% active (25% investment trusts, 25% OEICs) for international stocks and non-equities. I would use individual stocks for UK equity exposure, since we have good information and cheap dealing for those.

      Unfortunately, there are no tax-sheltered accounts with capped charges for OEICs, so I am gradually moving away from them.

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ETFs – Elements 5

by Mike Rawson time to read: 4 min
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