What is the TECH ETF used for?
The ETFS TECH ETF provides investors with exposure to the performance of shares in around 30 undervalued competitively-advantaged global technology businesses. Think global social media companies, online or cloud-based platforms, leaders in artificial intelligence, software creators and digital advertisers.
TECH could be used by Australian investors to gain exposure to a basket of the world’s leading technology companies. Buying the TECH ETF makes investing in some leading technology providers easier (and less costly) than buying each individual share on the market.
Keep an eye on FUM
The Global X TECH ETF had $295.65 million of money invested when we last pulled the monthly numbers. Given TECH’s total funds under management (FUM) figure is over $100 million, the ETF has met our minimum criteria for the total amount of money invested, otherwise known as FUM. We draw the line at $100 million for ETFs in the International shares sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
Fees and costs for investors
Global X charges investors a yearly management fee of 0.45% for the TECH ETF. This means that if you invested $2,000 in TECH for a full year, you could expect to pay management fees of around $9.00.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.5% or around $10.00 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Summary
These are just some of the considerations or factors you would need to look at when weighing up the TECH ETF. Before doing anything, take a look at our Global X TECH report – it’s free. While you’re at it, don’t forget to search our complete list of ASX ETFs.