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The number of self-managed super funds (SMSFs) using exchange traded funds (ETFs) has increased exponentially over the last decade from 27,000 to 145,000, according to the Vanguard/Investment Trends 2020 SMSF Report.
Even so, SMSF take-up and exposure to ETFs remains relatively low. Only 10% of SMSFs currently invest in these instruments, representing just 3.9% of their assets, according to data from SMSF administrators SuperConcepts.
Good to know: What is an ETF? As the name suggests, an exchange-traded fund is a managed fund that trades on an exchange, in the same way shares are bought and sold. Most are benchmarked to an index such as the ASX 200 or S&P 500 so investors can only achieve the market return. Active ETFs tend to achieve an above-market return, but there are far fewer of these.
For more information see SuperGuide article ETFs: How do I use them and what do they cost?
How are SMSFs using ETFs?
SMSF investors are predominantly using ETFs to deliver exposure to foreign indices.
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