[GRTV] The nitty gritty of Smart’s ETFs
Instead of buying the needle in the haystack, exchange-traded funds or ETFs give investors the opportunity to buy the whole haystack, Smart CEO Anna Scott tells GRTV in our latest episode.
Monday, December 2nd 2024, 8:33AM 
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by Kim Savage
The NZX-owned fund manager is a specialist in market-tracking funds and recently launched 4 new funds to grow its stable to 40 ETFs in total, with more options in the pipeline.
Diving into how ETFs work, Smart chief executive Anna Scott told GRTV that instead of buying a share of an individual stock, ETFs allowed investors to buy a unit of a fund.
“When you buy that stock, you've made a single choice,” she said.
“It's like going to the ice cream store and choosing strawberry versus putting together a bunch of different flavors that you want to have in your ice cream sundae.”
With the NZX50 for example, a market-tracking fund would give exposure to all 50 companies, said Anna Scott.
And ETFs could be used as a simple tool to diversify a portfolio, whether it was broad exposure to the New Zealand economy or exposure across a sector or investment theme investors were after.
“If you look at a wealth advisor, or you might have your own view on diversification, then in your asset allocation, you're going to hold a bit of Australia and a bit of America and some emerging and some emerging markets and some New Zealand - so you're putting all those ice cream flavors together.”
“We have some (funds) that represent all of those markets.”
“But if you also have a view that you particularly think that you're interested in the growth of health care as an industry, or robotics and automation, then that's where you get that specialist slice.”
Another benefit of including ETFs in portfolio structure was their ease of use.
“They're accessible, but they're also liquid and transparent, so you know what the price is at all times,” said Anna Scott.
To find out more about Smart’s ETF offering, check out this episode of GRTV.
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