As global investment markets have increasingly become characterised by uncertainty and volatility; a growing number of investors are recognising the value of Exchange-Traded Funds (ETFs) as a way of achieving diverse market exposure through a single investment transaction. Not only does such diversification mean that investors can reduce the risks associated with market volatility and economic fluctuations, but they also position themselves to capitalise on international growth opportunities.
FNB continues to expand its ETF offering and this time has launched three new Core Global ETFs, catering to the growing demand for accessible, rand-denominated, global market exposure. Sizwe Nxedlana, CEO of FNB Private Segment says, “These new ETFs represents our commitment to providing investment solutions that serve as a conduit to the world’s financial markets, without the complexity traditionally associated with direct offshore investments. Our compelling range of ETFs provides investors with the opportunity to achieve global and local equity and bond market exposure in a convenient and cost-effective way.”
“The products augment FNB’s existing suite of ETFs, bringing the total offering to eight. The existing solutions include the FNB Top40 ETF which offers investors exposure to the blue-chip companies listed on the JSE, which in combination with the FNB MidCap ETF, grants investors access to the heart of the South African equity market,” adds Nxedlana.
The new Core Global ETFs include:
- The new FNB MSCI Emerging Markets Feeder ETF which is designed for the investor with an eye for emerging markets, offering a vehicle to invest in a range of large, medium, and small-cap stocks across emerging economies. This ETF is best suited for those with a long-term investment horizon who are comfortable with the higher volatility typically seen in these markets.
- For those investors leaning more towards developed markets, the FNB MSCI World Feeder ETF tracks the MSCI World Index and provides a gateway to a diversified pool of large- and mid-cap companies across established economies. This ETF is tailored for investors seeking a more measured approach to international investment, with the stability that comes from developed market equities.
- Finally, the new FNB S&P 500 Feeder ETF offers investors direct access to the largest companies in the USA by tracking the performance of the S&P 500 Index. This ETF offers specific exposure to companies in the USA, which forms part of the exposure within the existing FNB S&P 1200 Fund of Funds ETF making it an attractive option for investors looking to integrate the robust performance of the USA economy and its largest companies into their investment strategies. The FNB S&P 500 Feeder ETF will also pay distributions (dividends), which means the product can be leveraged to generate a regular income if that is required.
Bheki Mkhize, CEO of FNB Wealth and Investments, echoes Nxedlana’ s sentiment and believes that the expanded range makes it simple and affordable for investors to achieve a balanced, well-rounded portfolio to optimise returns and manage risk. “FNB’s new and existing ETFs are a testament to our expertise and our dedication to providing low-cost, high-value investment opportunities to our client, and by providing an easy and cost-effective entry point into local and global markets, the FNB ETFs give effect to FNB’s commitment to democratising investment,” says Mkhize.
Mkhize further says that “in line with FNB’s drive to make investment more accessible, the bank’s ETFs are all designed with lower barriers to entry. They are available through FNB’s investment platforms, including FNB Shares Zero, which charges no monthly fees or brokerage for the initial purchase of these investments, thereby enhancing their appeal to a broader range of investors. Selected FNB ETFs are available as tax-free investments through FNB, amplifying the potential for long-term, tax-optimised growth.” The ETFs are also available through any other share trading platform in South Africa.
For global reach, the FNB Global 1200 Equity Fund of Funds ETF follows the S&P Global 1200 Index, encapsulating a significant portion of the global market capitalisation. Meanwhile, the FNB Government Inflation Linked Bond ETF and the FNB World Government Bond ETF offer exposure to the bond markets, with the latter tracking the World Government Bond Index and providing access to investment-grade sovereign bonds in both developed and emerging markets.
“We have leveraged our experience to refine our ETF solutions continually, our combination of accessible investment platforms and low-cost ETFs – many with proven track records – make FNB ETFs an obvious choice for novice and experienced investors alike. Testament to this, the FNB top 40 ETF has won best exchange traded fund when considering tracking efficiency over 3 years referencing South African equities over the last 3 years since 2022 and the best performing South African Equity exchange traded fund over a 5-years and 10-years period in 2024 at the South African Listed Tracker awards”, Bheki concludes.
For more information about FNB’s ETF offering, including the three new solutions, visit https://www.fnb.co.za/share-investing/exchange-traded-funds.html
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