The Bigger Picture

Understanding the ETF landscape

Exchange traded funds have been a revolution in financial services. They’re now the fastest growing investment product in the country, ASX data shows. With a compound annual growth rate of 35% they’ve overtaken LICS by size. However ETFs come in very different shapes and sizes. Most crucially, some are active while others are passive. In this panel, two pioneers of active and passive ETFs, Brett Cairns and Graham Tuckwell, discuss the important similarities and differences between the two.

Understanding the Political Landscape

Some superannuation funds are better than others. The best in breed, an influential study from the Productivity Commission found, are overwhelmingly the not-for-profit industry funds. Industry funds charge lower fees and provide better returns than the bank-owned retail funds, the PC found. Yet the politics around industry funds have been tricky. The Labor Party are thought to be their friends, as industry funds are owned by unions. Whereas the Liberals, it is said, are less keen. In conversation with Sky News, Ian Silk the boss of AustralianSuper, will discuss how this politics is changing.

Implications for the Future of Australian s  avings

Fees paid to many money managers and superannuation funds have been absurd. A report from the Grattan Institute found that Australians pay more than $30 billion a year in super fees a year, which comes to 2 per cent of GDP. Aussies spend more on super fees than they do on energy. But it’s one thing to identify and whinge about a problem; quite another thing to fix it. Our panel, featuring Peter Costello, looks at possible solutions, including index investing and a sovereign wealth fund.