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ETFs: Just when you thought you understood them, they've changed · The Money Puzzle

• 0:12
  Speaker 1: Hello and welcome to The Australian's Money Puzzle podcast. I'm
• 0:15
  Speaker 1: James Kirby, the wealth editor at The Australian. Welcome aboard, everybody.
• 0:20
  Speaker 1: Just before we start today's show, I want to just
• 0:23
  Speaker 1: deal with something. Thank you, everybody, who contacted us through
• 0:29
  Speaker 1: the email, themoneypuzzle at theaustralian.com.au in the last few days
• 0:34
  Speaker 1: about the FIRE movement. I knew there would be a response.
• 0:37
  Speaker 1: It's funny. It took a week or two rather than
• 0:39
  Speaker 1: a day or two, but here they come. And lots
• 0:42
  Speaker 1: of correspondence and questions about the FIRE movement. And fair enough,
• 0:47
  Speaker 1: a few people saying, well, you know, James Gerrard was
• 0:51
  Speaker 1: on basically offering a critique of the FIRE movement and
• 0:54
  Speaker 1: the FIRE movement, Financial Independence Retire Early movement. They should
• 0:58
  Speaker 1: have the right to come on and give their side
• 1:01
  Speaker 1: of the story, which they certainly do. And I will
• 1:04
  Speaker 1: do that. Just give me a chance to... There's two things.
• 1:06
  Speaker 1: First of all, I've got to find some time to
• 1:08
  Speaker 1: get them on the show, and I have to choose
• 1:10
  Speaker 1: who the spokesman, the most appropriate spokesperson, might be for
• 1:14
  Speaker 1: the fire movement. So we will sort that out. ASAP.
• 1:17
  Speaker 1: All right. Okay. Speaking about the email box. Every day,
• 1:21
  Speaker 1: without fail, there are questions about exchange-traded funds, ETFs. It's
• 1:25
  Speaker 1: easily the top subject, and I'm not surprised because exchange-traded
• 1:30
  Speaker 1: funds have become a gateway to the market. particularly for
• 1:34
  Speaker 1: people who are starting investing, early investors. But just as easily,
• 1:39
  Speaker 1: they are very popular with, can I call them sophisticated investors,
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  Speaker 1: experienced investors who have a kind of what they call
• 1:45
  Speaker 1: a core and satellite approach. So they have ETFs to
• 1:49
  Speaker 1: cover off certain areas of investing. It might be the
• 1:54
  Speaker 1: American share market or it might be bonds or it
• 1:57
  Speaker 1: might be emerging markets or whatever. And they have become
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  Speaker 1: so popular, of course, Understandably, just as I'm starting to
• 2:05
  Speaker 1: understand them and just as I think I've imparted what
• 2:07
  Speaker 1: you need to know about them, of course, they're shifting.
• 2:10
  Speaker 1: GoPosts are shifting as to what they actually are. So
• 2:14
  Speaker 1: I've had a few people on the show before about ETFs,
• 2:16
  Speaker 1: always to good response. So we've had Robin Bowerman from Vanguard.
• 2:21
  Speaker 1: We've had David Bassanese from BetaShares. And today my guest
• 2:25
  Speaker 1: is from the Global X Group. Global X, you may
• 2:28
  Speaker 1: not know, but once upon a time they were called ETF.
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  Speaker 1: And That was an organization which launched the first, the
• 2:36
  Speaker 1: original of the species, the first ever ETF in Australia,
• 2:40
  Speaker 1: which I remember reporting upon at the time. I think
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  Speaker 1: it was 1997. And it was a gold ETF, which
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  Speaker 1: remains the biggest gold ETF in the market, about three
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  Speaker 1: and a half billion in the market today. Looking over
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  Speaker 1: all that is Mark Jokum. He is at the Global
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  Speaker 1: X Group. He's an investment strategist there. How are you, Mark?
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  Speaker 2: Hi, James. Thanks so much for having me on the show.
• 3:01
  Speaker 2: Really looking forward to it.
• 3:03
  Speaker 1: Did I get the history right there? Was it 97?
• 3:05
  Speaker 3: So we launched the first gold ETF in 2003. But
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  Speaker 3: we started looking at the first ETF came in 1991
• 3:13
  Speaker 3: in Canada. But yes, as you alluded to, Australia, we
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  Speaker 3: were the first country to launch a gold exchange traded product.
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  Speaker 3: And we've seen a range of gold ETFs come after that.
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  Speaker 3: But yeah, we were the first. And yeah, we're now
• 3:25
  Speaker 3: recording this 2024. So yeah, 21 years we've been in
• 3:28
  Speaker 3: the market with it.
• 3:29
  Speaker 1: And money pouring into that one at the moment, I expect.
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  Speaker 3: Yeah, I mean, we've seen a lot of interest within
• 3:35
  Speaker 3: gold exchange traded funds, in particular around geopolitical risk. There
• 3:39
  Speaker 3: was inflation, obviously, and also with interest rates coming down,
• 3:42
  Speaker 3: that usually bodes quite well for the yellow metal. So
• 3:46
  Speaker 3: the last few months have been successive inflows into ETFs,
• 3:49
  Speaker 3: which contradicts the last 12 to 18 months, which is actually,
• 3:52
  Speaker 3: funnily enough, been outflows. So it just shows that even
• 3:55
  Speaker 3: investors are investing into gold at their all-time highs at
• 3:58
  Speaker 3: the moment because they want it for that defensive capability.
• 4:01
  Speaker 1: Yes, just to use that as a sort of proxy
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  Speaker 1: for the whole area. So, I mean, ETFs are very
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  Speaker 1: useful anyway, folks, because you can buy, as I say,
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  Speaker 1: you can buy the American share market or you can
• 4:11
  Speaker 1: buy the European share market. You can buy emerging markets
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  Speaker 1: or bonds. What it does, it gives access to people.
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  Speaker 1: Most people still never buy bonds, but it was a
• 4:23
  Speaker 1: way in. I don't know if it's the best way in.
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  Speaker 1: We haven't time to talk about that, but it's a
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  Speaker 1: way in. And similarly with gold. I mean, really, people
• 4:31
  Speaker 1: who were gold investors, they had gold bars, and they
• 4:34
  Speaker 1: had them in vaults, and they paid an awful lot
• 4:37
  Speaker 1: to keep those bars insured and all that sort of thing.
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  Speaker 1: And it was very difficult, and you really had to
• 4:43
  Speaker 1: be either a bit obsessional or very wealthy to have
• 4:46
  Speaker 1: gold up until this ETF was launched. So it's a
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  Speaker 1: good example, really, of how they did change everything. I'm
• 4:52
  Speaker 1: going to begin with something. I'm going to begin by
• 4:55
  Speaker 1: giving you a free kick mark, but it's worth introducing
• 4:58
  Speaker 1: to people why ETFs have been successful. And we know
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  Speaker 1: that they are, at their best, they're simple and low fee.
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  Speaker 1: But also, there was a habit. Once upon a time,
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  Speaker 1: you could only buy, an Australian investor, everyday investor, could
• 5:16
  Speaker 1: only buy funds in the way of managed funds. And
• 5:19
  Speaker 1: there was big fund houses, Platinum and Perpetual and Magellan.
• 5:23
  Speaker 1: And they were all big names and they have all,
• 5:25
  Speaker 1: in various ways, faded rapidly and shrunk. And one of
• 5:29
  Speaker 1: the reasons you've put to me is what they call
• 5:32
  Speaker 1: closet indexing. Explain what that is and the critique that
• 5:37
  Speaker 1: your industry, the ETF industry, has about closet indexing.
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  Speaker 3: Yeah, it's a really interesting phenomenon, James, where you've got
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  Speaker 3: this idea of closet indexing, which is just another way
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  Speaker 3: to describe fund managers who are masquerading themselves as active
• 5:53
  Speaker 3: fund managers, but their portfolios closely resemble index funds. And
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  Speaker 3: I think that's really important now with the proliferation of
• 6:01
  Speaker 3: ETFs that investors actually look under the hood of their
• 6:05
  Speaker 3: active manager to see what are the underlying holdings. Are
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  Speaker 3: they traditionally different from a benchmark or an index ETF?
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  Speaker 3: Because if you look at some of the top fund
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  Speaker 3: managers out there, a lot of them have very similar
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  Speaker 3: holdings in terms of, you know, when you look at
• 6:21
  Speaker 3: the top 10 holdings to a low cost index ETF,
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  Speaker 3: the only difference with them is they charge significantly higher fees.
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  Speaker 3: And usually just the simple arithmetic of the share market
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  Speaker 3: is they normally underperform by the amount of their fees.
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  Speaker 3: So I think not necessarily saying that the likes of
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  Speaker 3: Magellan and Perpetual were closet indexes per se, but I
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  Speaker 3: think the key push is that investors really push for
• 6:44
  Speaker 3: greater transparency from their fund managers.
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  Speaker 1: So what you're saying is that once upon a time,
• 6:49
  Speaker 1: or still, I go and I buy a fund. It's
• 6:52
  Speaker 1: called the Australian Share Fund. It's from white box managers. And-
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  Speaker 1: It's a managed fund. And when I look inside, I
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  Speaker 1: find that the top stocks are the four banks, the
• 7:02
  Speaker 1: big two miners, Coles and Woolworths, etc. And then you're
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  Speaker 1: saying to me, why didn't you just buy an ETF
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  Speaker 1: on the Australian share market? It's got much lower fees.
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  Speaker 1: It's going to outperform active managers invariably. That is, it's
• 7:16
  Speaker 1: going to do better anyway, nine times out of 10.
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  Speaker 1: And on top of that, if you look inside the ETF,
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  Speaker 1: it's going to have the big four banks, the big
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  Speaker 1: two miners. And the big two supermarkets. So why bother
• 7:27
  Speaker 1: go to the active person if they're not being active?
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  Speaker 1: Is this the point? Okay, that's the point you're making. Now,
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  Speaker 1: here's the thing. That's all fine. And I don't disagree
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  Speaker 1: with it for one minute. More recently, do you at GlobalX,
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  Speaker 1: do you offer active ETFs?
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  Speaker 3: So within our Australian business, no, we don't offer active ETFs.
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  Speaker 3: We have traditionally been index-based ETFs. And all that is
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  Speaker 3: it follows just a rules-based methodology to classify a particular investment.
• 7:54
  Speaker 3: That being said, we have seen a range of different
• 7:56
  Speaker 3: active ETFs come to the market as well, which I'm
• 7:58
  Speaker 3: happy to dive into as well.
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  Speaker 1: So just to clear the air for everybody. So for
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  Speaker 1: a long time, an ETF was always the same thing.
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  Speaker 1: It was an index. So if you bought the Vanguard
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  Speaker 1: or BellaShares or GlobalX American Wall Street S & P
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  Speaker 1: Index Fund, you were buying the S & P index.
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  Speaker 1: Every single stock in it was represented in that fund
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  Speaker 1: proportionately as they are on the actual market. It's very
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  Speaker 1: easy to understand, and it acted in a certain way. Now,
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  Speaker 1: more recently, I'm sure you're not going to rule out
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  Speaker 1: doing active ETFs anyway, and a lot of your competitors
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  Speaker 1: already offer them. James Gerrard, who already triggered the debate
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  Speaker 1: on the FIRE movement a few weeks ago, also said,
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  Speaker 1: possibly on that same show, that I found this really interesting,
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  Speaker 1: that the new style active ETFs Where an ETF, for instance,
• 8:55
  Speaker 1: we give a good easy example, electric car ETF, right?
• 8:58
  Speaker 1: Where they simply say, we're going to buy a bunch
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  Speaker 1: of electric car stocks, choose them for you, and then
• 9:02
  Speaker 1: we're going to let that run. And you can see
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  Speaker 1: how it goes. He said that traditional ETFs, like you've
• 9:09
  Speaker 1: just been talking about, that dominate your company and your offerings,
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  Speaker 1: that they beat active ETFs just like they beat active
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  Speaker 1: fund managers. Is that the case?
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  Speaker 3: I think when it comes to this whole active versus passive,
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  Speaker 3: it really depends on, one, an investor's timeframe. Because the
• 9:28
  Speaker 3: one thing you see, James, is some active fund managers
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  Speaker 3: can be passive over the short term.
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  Speaker 2: But over the long term, it's a really different story.
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  Speaker 1: But do you know, do active ETFs, are they beaten
• 9:39
  Speaker 1: by passive ETFs? Is there any data to suggest that?
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  Speaker 2: Yeah, majority of the time they are.
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  Speaker 1: Okay, just hold that thought. Why do they offer active
• 9:48
  Speaker 1: ETFs if the industry knows that passive ETFs will beat them?
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  Speaker 2: It's about distribution at the end of the day, James.
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  Speaker 3: So a lot of active ETFs have seen, or active
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  Speaker 3: managers have seen the flight of money that's leaving unlisted
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  Speaker 3: managed funds and going into the ETF wrapper. So for them,
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  Speaker 3: it's really about distribution because people want the transparency of
• 10:07
  Speaker 3: an ETF. They want the liquidity of the ETF and
• 10:10
  Speaker 3: they want the tax efficiency of an ETF. They've seen
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  Speaker 3: a lot of success, particularly the Australian active fund managers
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  Speaker 3: have seen the success of the US and their ETF market.
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  Speaker 2: Where around about a third of.
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  Speaker 3: The flows in the US ETF market are going to
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  Speaker 3: active funds. But just because it looks like an ETF
• 10:26
  Speaker 3: and it acts like an ETF doesn't mean that naturally
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  Speaker 3: money's going to go towards it. And you've actually seen
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  Speaker 3: outflows come from active ETFs.
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  Speaker 2: So you're right.
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  Speaker 3: There has been a barrage of new ETFs. In fact,
• 10:37
  Speaker 3: last year, over half of the new ETFs were active ETFs.
• 10:41
  Speaker 3: They account for around about 30% of the market, but
• 10:44
  Speaker 3: they're not seeing the same level of flows, which is
• 10:46
  Speaker 3: really interesting.
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  Speaker 1: Okay, so you're saying it was a response basically to
• 10:51
  Speaker 1: customer demand that this was offered by the industry. But
• 10:55
  Speaker 1: having said that, it's really worth hearing this, folks. Active
• 10:59
  Speaker 1: ETFs are beaten by passive ETFs. I have to say
• 11:03
  Speaker 1: that I don't know why I certainly would ever buy
• 11:05
  Speaker 1: an active ETF ever if they are beaten by passive ETFs.
• 11:09
  Speaker 1: I just don't see why you would. Tell me I'm wrong.
• 11:12
  Speaker 1: Let's hear from you. I can be intellectually seduced by arguments,
• 11:17
  Speaker 1: you know. about various market weighted ETFs, etc, etc. But
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  Speaker 1: in the end, aren't you being seduced by the old
• 11:23
  Speaker 1: fashioned notion that someone is going to be smarter than
• 11:27
  Speaker 1: the market?
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  Speaker 3: But the harsh reality is of the fund managers who
• 11:30
  Speaker 3: can actively outperform, you know, very few can do it.
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  Speaker 3: And over a long period of time, only one to 2%
• 11:35
  Speaker 3: of them can do it for multiple periods. So even
• 11:38
  Speaker 3: if you can pick the active fund manager in one year,
• 11:40
  Speaker 3: doesn't mean that they can necessarily going to perform in
• 11:42
  Speaker 3: the other year. And, you know, 2023 was a great
• 11:45
  Speaker 3: year when, you know, there was meant to be market volatility,
• 11:48
  Speaker 3: which seemed favorable for active managers. And funnily enough, research
• 11:51
  Speaker 3: actually indicates that the optimal conditions for their outperformance is
• 11:55
  Speaker 3: actually low volatility, which is contrary to belief, high correlations,
• 12:00
  Speaker 3: and there's high stocks dispersions. But that only occurs around
• 12:03
  Speaker 3: about 2% of the time when it comes to markets.
• 12:06
  Speaker 3: So you really got to be quite, pick that right
• 12:08
  Speaker 3: point in time and also pick the right fund manager
• 12:11
  Speaker 3: because And the harsh evidence says that index-based investing has
• 12:13
  Speaker 3: outperformed active, but investors do want that active piece, particularly
• 12:18
  Speaker 3: for funds that have high active share, just to add
• 12:20
  Speaker 3: a bit of spice to the portfolio.
• 12:22
  Speaker 2: So that's where a lot of people are seeing the
• 12:24
  Speaker 2: use of it.
• 12:24
  Speaker 1: To kind of back their own hunch or back their
• 12:27
  Speaker 1: own instincts or whatever when that comes up. Okay, very interesting.
• 12:29
  Speaker 1: We're going to take a break and we'll come back
• 12:31
  Speaker 1: and we'll talk to Mark about the ETF scene and
• 12:34
  Speaker 1: how it's unfolding, where most people put their money and
• 12:37
  Speaker 1: what sort of trends he's starting to distinguish in our
• 12:40
  Speaker 1: market here in the Australian scene. Okay, back in a moment.
• 12:56
  Speaker 1: Hello and welcome back to the Australian's Money Puzzle. I'm
• 12:58
  Speaker 1: James Kirby and I'm talking to Mark Jokum of the
• 13:02
  Speaker 1: Global X Index Funds and ETF Group, one of the
• 13:05
  Speaker 1: big operators in the local market for ETFs. Mark, tell me,
• 13:10
  Speaker 1: I look at the figures, it seems to me most people,
• 13:13
  Speaker 1: once they've bought their Australian share market ETF, what happens
• 13:17
  Speaker 1: after that? What does the data tell you? What do
• 13:20
  Speaker 1: most people do after that?
• 13:22
  Speaker 3: Well, funnily enough, this year, James, it's really been about
• 13:24
  Speaker 3: global shares. And I think that's the great use of
• 13:26
  Speaker 3: exchange traded funds is, you know, you can buy your
• 13:29
  Speaker 3: Aussie stocks, you can buy your Aussie ETFs, but global
• 13:32
  Speaker 3: shares have actually really opened up access for investors to
• 13:35
  Speaker 3: gain access to leading global companies using a low cost
• 13:38
  Speaker 3: wrapper like an ETF. And you've seen gradually over time,
• 13:42
  Speaker 3: you know, if I go back to when the ETF
• 13:44
  Speaker 3: market first started, It was really dominated by Aussie shares
• 13:47
  Speaker 3: and commodities, gold being one of them that we spoke
• 13:50
  Speaker 3: about earlier. But now the majority of the actual ETF
• 13:53
  Speaker 3: market is global shares. And that's because ETFs are used
• 13:57
  Speaker 3: as that vehicle for accessing these international opportunities. So far
• 14:00
  Speaker 3: this year, it's been very much a risk on sentiment, James,
• 14:03
  Speaker 3: where we've seen a lot of money coming out of
• 14:05
  Speaker 3: areas like cash and going into areas like global shares
• 14:09
  Speaker 3: because we've seen the rise of the dominance of some
• 14:11
  Speaker 3: of these developed markets like the U.S., Last year was
• 14:14
  Speaker 3: a little bit different where we saw a lot more
• 14:16
  Speaker 3: flows going into bond ETFs, particularly within things like floating
• 14:20
  Speaker 3: rate notes.
• 14:20
  Speaker 2: And I think that's your point, James. The beautiful thing
• 14:22
  Speaker 2: about an ETF.
• 14:24
  Speaker 3: Is your listeners and investors can access all these different
• 14:27
  Speaker 3: asset classes that were once cumbersome or hard to get
• 14:30
  Speaker 3: exposure to via a low cost ETF to provide that
• 14:34
  Speaker 3: access point.
• 14:35
  Speaker 1: Cumbersome. The perfect word. I should have thought of that earlier.
• 14:38
  Speaker 1: That's right. When you're talking about the gold, like that
• 14:41
  Speaker 1: was cumbersome. That's for sure. Or as for buying bonds,
• 14:44
  Speaker 1: I mean, really, where would you start and how many
• 14:47
  Speaker 1: would you have? And you try to have a ladder
• 14:48
  Speaker 1: of maturities and, you know, you always had to do
• 14:51
  Speaker 1: a short course about how to even start. Okay, talking
• 14:55
  Speaker 1: then about this area of offshore. So you're telling me
• 14:58
  Speaker 1: that the big trend among Australian investors in their use
• 15:03
  Speaker 1: of index funds and ETFs is to buy global markets. Okay,
• 15:08
  Speaker 1: what did they buy? I'm guessing Wall Street, NASDAQ, And
• 15:13
  Speaker 1: then maybe a global fund, but the global funds are
• 15:15
  Speaker 1: going to be 70% Wall Street anyway, aren't they?
• 15:18
  Speaker 2: Exactly.
• 15:19
  Speaker 3: And that's why a lot of you're seeing a lot
• 15:20
  Speaker 3: more this year is just going towards your general broad market,
• 15:23
  Speaker 3: low cost ETFs. So you think about your entire world
• 15:28
  Speaker 3: access products, but also some countries are becoming a bit
• 15:31
  Speaker 3: more popular. US is one area that a lot of
• 15:33
  Speaker 3: people want exposure to due to the Magnificent Seven stocks.
• 15:37
  Speaker 3: But there's other regional pockets, like we're seeing a bit
• 15:39
  Speaker 3: of interest in Europe. We're seeing a lot more in India.
• 15:42
  Speaker 3: India is a very interesting one because it's almost going
• 15:44
  Speaker 3: to take over the lead of China in the Emerging
• 15:47
  Speaker 3: Markets Index. Most of the flows are still going towards
• 15:49
  Speaker 3: your broad-based diversified ETFs covering very broad market exposure. And
• 15:54
  Speaker 3: I think that's a very sensible way for a majority
• 15:56
  Speaker 3: of people to invest. But then they can take a
• 15:58
  Speaker 3: bit more tactical views. If you want to go into
• 16:01
  Speaker 3: a particular country, a particular style, a particular thematic, a
• 16:05
  Speaker 3: lot of people have been talking about investing in things
• 16:08
  Speaker 3: like copper, uranium. You can get very esoteric investment at
• 16:13
  Speaker 3: exposure via an ETF, which is such a great way
• 16:15
  Speaker 3: for investors, instead of having to worry about pick all
• 16:18
  Speaker 3: these stocks, especially if you're trading international stocks, you don't
• 16:21
  Speaker 3: want to have to open up a brokerage account, change
• 16:23
  Speaker 3: your Aussie dollars into US dollars, handle all the paperwork,
• 16:26
  Speaker 3: an ETF really jumpler.
• 16:28
  Speaker 1: Give us an example of what in terms of those
• 16:30
  Speaker 1: thematic ETFs or specialized ETFs, is there one in particular
• 16:35
  Speaker 1: that's getting inflows at the moment?
• 16:39
  Speaker 3: Yeah, we're seeing a lot of interest within our copper
• 16:41
  Speaker 3: miners ETF. The ticket code for that is WIRE, W-I-R-E.
• 16:45
  Speaker 3: The reason for that, James, is everyone knows copper is
• 16:48
  Speaker 3: an incredibly.
• 16:49
  Speaker 2: Important part of the global economy.
• 16:52
  Speaker 3: It used to be a bit of a proxy for
• 16:53
  Speaker 3: what's going on with economic activity, but it's slowly transitioning.
• 16:57
  Speaker 1: Dr. Copper.
• 16:59
  Speaker 2: Yeah, Dr.
• 16:59
  Speaker 3: Copper, as they called it. It's slowly transitioning into this
• 17:03
  Speaker 3: secular economy. commodity that's going to be driven by electrification
• 17:07
  Speaker 3: urbanization the rise of artificial intelligence because copper is used
• 17:11
  Speaker 3: in a lot of things when you talk about renewable
• 17:13
  Speaker 3: energy it's used in building things like wind turbines solar
• 17:17
  Speaker 3: panels if you look at data centers which are powering
• 17:20
  Speaker 3: this ai revolution they require per gigawatt of data they
• 17:24
  Speaker 3: require 65 000 tons of copper So if you're talking
• 17:28
  Speaker 3: about the use of AI.
• 17:30
  Speaker 1: And the electric cars, of course.
• 17:32
  Speaker 2: Exactly. So electric cars is.
• 17:33
  Speaker 3: A good example where compared to an internal combustion engine,
• 17:36
  Speaker 3: it requires four times the amount of copper to use.
• 17:39
  Speaker 3: So people are starting to understand this broad case for copper.
• 17:43
  Speaker 3: And it's predicted to be in deficit for over the
• 17:46
  Speaker 3: medium term as well, which bodes quite well for the price.
• 17:48
  Speaker 3: And a lot of Aussies wanting to get exposure to
• 17:50
  Speaker 3: copper tend to invest just in the Australian miners. And
• 17:54
  Speaker 3: we've seen the likes of BHP. They had a bid
• 17:57
  Speaker 3: when it came to some of the global companies. They've
• 17:59
  Speaker 3: just set up a joint venture with London, which is
• 18:01
  Speaker 3: a company that's in our Y ETF. But there's a
• 18:04
  Speaker 3: global range of companies that investors may be missing out on.
• 18:07
  Speaker 1: The BHP in there was clearly shifting towards copper, as
• 18:13
  Speaker 1: you say, the commodity of the future. Okay. Can I
• 18:16
  Speaker 1: just ask you, though, about the ETFs, whether they're specialized
• 18:19
  Speaker 1: or whether they're broad brush? So whether you're talking about
• 18:22
  Speaker 1: a copper ETF? or an electric car ETF, or a
• 18:26
  Speaker 1: Wall Street ETF. One of the things that's a criticism
• 18:30
  Speaker 1: of ETFs, and I'm not talking about some of the
• 18:34
  Speaker 1: more sort of arcane things that come up, but a
• 18:36
  Speaker 1: very simple one is that in buying everything, you buy
• 18:40
  Speaker 1: all the rubbish, and you buy all the bad stuff,
• 18:43
  Speaker 1: and you buy all the nasties, you buy all the
• 18:46
  Speaker 1: ethically questionable, if not downright dreadful companies, because if I
• 18:51
  Speaker 1: go and buy a copper ETF, and it has 87
• 18:56
  Speaker 1: or 870 copper mining companies in there, and it must
• 19:01
  Speaker 1: buy everything that's on the market by definition, it promises
• 19:06
  Speaker 1: to buy everything, so it must buy everything. And that
• 19:08
  Speaker 1: means it must also buy some pretty bad companies that
• 19:10
  Speaker 1: you would never buy, ever. But you must because it's
• 19:14
  Speaker 1: an ETF. Is that a failing of ETFs?
• 19:19
  Speaker 3: I think so, but I don't know if it's more
• 19:21
  Speaker 3: a bug or a feature, James, because the good thing
• 19:24
  Speaker 3: about an ETF is you're expressing the view of that
• 19:28
  Speaker 3: intellectual humility that you don't really know who are going
• 19:30
  Speaker 3: to be the winners and losers. Naturally, particularly the ETFs
• 19:34
  Speaker 3: that weight the stocks by size or by market cap,
• 19:37
  Speaker 3: the market does a pretty good job at distilling all
• 19:41
  Speaker 3: the information out in the market to accurately price these
• 19:45
  Speaker 3: particular securities. And I think it's actually quite good to
• 19:48
  Speaker 3: get exposure, even though you're right, there are a bunch
• 19:50
  Speaker 3: of junk stocks that can come into an index. But naturally,
• 19:54
  Speaker 3: the bigger players are going to have a larger weight
• 19:56
  Speaker 3: in your portfolio. So if you didn't have exposure to
• 19:59
  Speaker 3: some of the Magnificent Seven stocks, you probably would have
• 20:02
  Speaker 3: underperformed the market. And the harsh reality is 67% of
• 20:06
  Speaker 3: stocks underperform a basic market index.
• 20:10
  Speaker 1: Indisputably, that's an argument, a very strong argument on the
• 20:13
  Speaker 1: basis of price. But is there any ethical dimension here? Like,
• 20:16
  Speaker 1: for instance, do you think ETFs should have more of
• 20:18
  Speaker 1: a role in voting, etc.
• 20:21
  Speaker 3: Yeah, I mean, that gets into the political nature around ETFs,
• 20:24
  Speaker 3: and they are becoming a greater part of the global
• 20:28
  Speaker 3: share market. You're seeing that companies in the US, ETF
• 20:32
  Speaker 3: issuers are starting to think about, well, how can they
• 20:34
  Speaker 3: actually outsource the proxy voting to all their individual investors?
• 20:38
  Speaker 2: Which is a very.
• 20:39
  Speaker 3: Interesting topic because when you invest in an ETF, you're
• 20:42
  Speaker 3: really outsourcing that to the ETF managers who use as
• 20:45
  Speaker 3: an investment steward to vote on shareholders' behalf. That being said,
• 20:50
  Speaker 3: I don't know how many people actually do want to
• 20:52
  Speaker 3: vote when they go to the meeting of a particular company.
• 20:54
  Speaker 3: And especially if you're owning a broad market ETF that
• 20:56
  Speaker 3: holds hundreds of companies going to all the individual meetings
• 20:59
  Speaker 3: and voting on them, some people will, especially some that
• 21:03
  Speaker 3: have strong, pretty strong for instance, sustainability views, ESG views.
• 21:08
  Speaker 3: But for the vast majority, they just want low-cost exposure.
• 21:11
  Speaker 3: But I do see that as a way of innovating
• 21:13
  Speaker 3: in terms of ETFs providing more access, more choice. And
• 21:16
  Speaker 3: proxy voting is particularly an area that could see some
• 21:19
  Speaker 3: development in the ETF market.
• 21:22
  Speaker 1: All right, we'll leave it at that. We will be
• 21:23
  Speaker 1: back in a moment, folks. I have pre-selected, curated a
• 21:28
  Speaker 1: couple of questions strictly from our audience, strictly on ETFs.
• 21:34
  Speaker 1: So perhaps we will get through some of the questions
• 21:37
  Speaker 1: that have been boiling up at the Money Puzzle in
• 21:39
  Speaker 1: recent times. OK, back in a moment. Hello and welcome
• 21:50
  Speaker 1: back to the Australian's Money Puzzle podcast. I'm James Kirby
• 21:54
  Speaker 1: with Mark Jochum of the Global X Group. He's the
• 21:58
  Speaker 1: investment strategist there. Now, Mark, these questions are, several of
• 22:03
  Speaker 1: them willfully break our golden rule of keeping questions short.
• 22:07
  Speaker 1: I don't know how I can shorten some of them,
• 22:11
  Speaker 1: but if you bear with me, I'll just try and
• 22:13
  Speaker 1: go through them and I'll try and paraphrase to the
• 22:16
  Speaker 1: extent I can without losing the nature of the question.
• 22:20
  Speaker 1: I'll just take an easy one first from Adam. Dear James,
• 22:23
  Speaker 1: can you outline what is meant by an open-ended ETF?
• 22:26
  Speaker 1: How do such open-ended ETFs adjust their prices to reflect
• 22:30
  Speaker 1: underlying assets? And is there such a thing as a
• 22:33
  Speaker 1: closed-end ETF? Okay, Mark Jochum, investment strategist, what's an open-ended
• 22:38
  Speaker 1: ETF and is there a closed-ended one?
• 22:42
  Speaker 2: Yeah, so great question, Adam.
• 22:43
  Speaker 3: Very simply, open-ended just means that units can be created
• 22:47
  Speaker 3: or destroyed based on the underlying demand. So when there's
• 22:50
  Speaker 3: demand for a particular product, the fact that it's open-ended
• 22:52
  Speaker 3: means that these market makers or authorized participants can come
• 22:56
  Speaker 3: in and either create new units or end up redeeming units.
• 23:00
  Speaker 3: And the reason why open-ended is important is because, and
• 23:03
  Speaker 3: your other question was around how it's reflected based on
• 23:05
  Speaker 3: the NAV, is that the price of the ETF will
• 23:08
  Speaker 3: track very closely to the net asset value, the NAV
• 23:11
  Speaker 3: or the NAV, due to the actions of these big
• 23:13
  Speaker 3: banks and these market makers and authorised participants. Because if
• 23:16
  Speaker 3: there's a difference between the price of an ETF and
• 23:19
  Speaker 3: the NAV of an ETF, the net asset value, That's
• 23:22
  Speaker 3: an arbitrage opportunity for these very smart institutions to actually
• 23:25
  Speaker 3: make some money in terms of either buying or selling
• 23:28
  Speaker 3: the underlying ETF versus the security. So if an ETF
• 23:31
  Speaker 3: price trades at a discount to its net asset value,
• 23:34
  Speaker 3: the market maker will go in, buy the ETF and
• 23:37
  Speaker 3: then sell the underlying to profit the difference. And that
• 23:39
  Speaker 3: way it tracks close to NAV. And then your other
• 23:42
  Speaker 3: question was around, are they closed ended ETFs? The answer
• 23:45
  Speaker 3: is yes, they are, but they're not called ETFs. They're
• 23:48
  Speaker 3: called listed investment companies or LICs. So these are different
• 23:51
  Speaker 3: where these are similar in terms of the fact that
• 23:53
  Speaker 3: they do expose to a broad asset class.
• 23:55
  Speaker 1: I don't want to go down this kind of rabbit hole,
• 23:57
  Speaker 1: but the LIC isn't identical to an ETF. I mean,
• 24:00
  Speaker 1: they select the shares they wish. Isn't that right? While
• 24:02
  Speaker 1: the ETF doesn't select them. It literally takes what's on
• 24:05
  Speaker 1: the board.
• 24:05
  Speaker 3: Yeah. And I think the main one is around the
• 24:08
  Speaker 3: structure of them. There's only a fixed pool of capital.
• 24:11
  Speaker 3: So there's only a fixed amount of shares out there.
• 24:12
  Speaker 3: The reason that some of them trade at a large
• 24:15
  Speaker 3: discount to their NTA or sometimes they trade at a
• 24:18
  Speaker 3: premium is is because there is no market maker, there
• 24:20
  Speaker 3: is no authorized participants that are creating and redeeming these shares.
• 24:24
  Speaker 3: And I think that managers don't really have an incentive
• 24:26
  Speaker 3: to close that discount because at the end of the day,
• 24:28
  Speaker 3: it's a closed pool of capital.
• 24:30
  Speaker 2: They collect the fees. So why would they want to
• 24:31
  Speaker 2: close the discount?
• 24:32
  Speaker 1: Okay, we're very popular and remain popular. But there was
• 24:36
  Speaker 1: a period where the LIC was the nearest thing in
• 24:38
  Speaker 1: some ways to they were more than a managed fund.
• 24:41
  Speaker 1: And they were invented way back. And some very big
• 24:45
  Speaker 1: ones still in the market, AFIC and Argo out of Adelaide,
• 24:48
  Speaker 1: which was once connected with Sir Don Brandman. And he
• 24:51
  Speaker 1: was on the board of Argo. They tell us about
• 24:53
  Speaker 1: that every time we talk to them. And they remain popular.
• 24:57
  Speaker 1: Some people see them as a useful. The Wilson Group
• 25:00
  Speaker 1: has some. They remain an interesting variation on the managed
• 25:06
  Speaker 1: fund where you are. using the brainpower of some leading
• 25:10
  Speaker 1: managers to pick stocks, but then the vehicle is a
• 25:14
  Speaker 1: bit more useful than some straight managed funds. Okay, we'll
• 25:17
  Speaker 1: leave that to one side for the moment. I think
• 25:19
  Speaker 1: that answers your question, Adam. That's open-ended ETFs. That's basically
• 25:23
  Speaker 1: how they work. That was the part of the magic
• 25:26
  Speaker 1: of these products that were all created once upon a time.
• 25:30
  Speaker 1: Go back to a man called Jack Bogle, B-O-G-L-E, who
• 25:34
  Speaker 1: was the sort of godfather of all this and created
• 25:36
  Speaker 1: the Vanguard Group. And you can read all about it,
• 25:39
  Speaker 1: I'm sure, somewhere. All right, question from Yogesh, Y-O-G-E-S-H. While
• 25:46
  Speaker 1: looking in ETFs, I came across a geared ETF. I'm
• 25:51
  Speaker 1: unable to understand how they work. Are you able to
• 25:53
  Speaker 1: give that common understanding? Yes, of course. I'm sure Mark
• 25:58
  Speaker 1: Jokom would do that for you, Yogesh. A geared, just
• 26:01
  Speaker 1: to make it easy, folks, is a course. It's an
• 26:04
  Speaker 1: index fund, just like we're talking about. But they borrow,
• 26:07
  Speaker 1: that's all. You don't get the negative gearing. That's the thing,
• 26:09
  Speaker 1: of course. If you borrowed and bought the ETF, you'd
• 26:12
  Speaker 1: get negative gearing. So you don't get it. So maybe
• 26:14
  Speaker 1: Mark will tell us all about that. Okay. Would you
• 26:17
  Speaker 1: illuminate us there, Mark?
• 26:20
  Speaker 3: Yeah, you're exactly right, James. And thanks, Yogesh, for the question.
• 26:23
  Speaker 3: Geared ETFs pretty much use internal borrowing. Saves you from
• 26:26
  Speaker 3: having to go out to get a margin loan, to
• 26:29
  Speaker 3: borrow to invest money. sometimes the ETF wrapper will do
• 26:31
  Speaker 3: it for you. And the fund manager is able to
• 26:34
  Speaker 3: go out and get an institutional rate from some of
• 26:36
  Speaker 3: the large banks. They can get a loan and they
• 26:39
  Speaker 3: handle all the gearing process for you. There is a
• 26:41
  Speaker 3: difference with leverage ETFs, even though they may seem one
• 26:44
  Speaker 3: in the same, where leverage ETFs use a bit more
• 26:47
  Speaker 3: financial magic by using derivatives like futures contract to get
• 26:51
  Speaker 3: magnified exposure. And that's what people who invest in geared
• 26:55
  Speaker 3: or leverage ETFs want. You want exposure that provides more
• 26:58
  Speaker 3: to the market or less to the market as well.
• 27:00
  Speaker 3: So currently there's ETFs out there that provide as little
• 27:03
  Speaker 3: as about 1.4 times the daily price of the actual index.
• 27:07
  Speaker 3: But there's some that are a little bit up the
• 27:09
  Speaker 3: risk curve that provide up to 2.7 times the exposure
• 27:13
  Speaker 3: to the particular market. Good alternative for people who want
• 27:16
  Speaker 3: exposure to the market but in a magnified way and
• 27:20
  Speaker 3: not having to realize going to go get a margin
• 27:22
  Speaker 3: loan and they can access lower borrowing by going through
• 27:24
  Speaker 3: a geared or leveraged ETF.
• 27:26
  Speaker 1: And what could go wrong with the leveraged ETF compared
• 27:30
  Speaker 1: to a standard ETF?
• 27:31
  Speaker 3: Yes, so they are very risky, just pointing out there,
• 27:34
  Speaker 3: because they are really designed to achieve this multiple on
• 27:37
  Speaker 3: a daily basis. which means over the long term, even
• 27:40
  Speaker 3: though share markets go up, because of this idea of
• 27:42
  Speaker 3: daily movements and daily rebalancing, it actually could, if the
• 27:46
  Speaker 3: gearing ratio does fall outside that particular range, can be
• 27:50
  Speaker 3: quite detrimental to investors. And I think that this idea
• 27:53
  Speaker 3: of this compounding effect of daily rebalancing can sometimes cause
• 27:57
  Speaker 3: people's representation of what the ETF.
• 28:00
  Speaker 2: Might do over the long term.
• 28:02
  Speaker 3: As an example, if you're invested in a two times,
• 28:04
  Speaker 3: let's use a simple example, two times leverage ETF.
• 28:07
  Speaker 1: Just to explain, Mark, two times, that means for every
• 28:09
  Speaker 1: dollar you put in, they borrow a dollar.
• 28:11
  Speaker 3: Exactly.
• 28:11
  Speaker 2: So that's double the exposure.
• 28:13
  Speaker 3: So if the index is down 5%, your ETF will
• 28:16
  Speaker 3: probably be down 10% on that day.
• 28:18
  Speaker 1: So everything's magnified.
• 28:20
  Speaker 2: Exactly. Your $ 100 is now $ 90.
• 28:22
  Speaker 3: And let's say the market's up the next day, because
• 28:26
  Speaker 3: that's generally what happens. Large fall days are accompanied by
• 28:29
  Speaker 3: large up days. So if the index goes up 5%,
• 28:33
  Speaker 3: that means, again, the ETF will go up 10% that day.
• 28:36
  Speaker 3: But if you think about it, that $ 90 going up 10%
• 28:39
  Speaker 3: is now $ 99. So you're still down a dollar overall.
• 28:42
  Speaker 3: And this is this whole arithmetic is that over time
• 28:45
  Speaker 3: in a volatile market, these small differences can lead to
• 28:47
  Speaker 3: larger deviations, particularly magnified when you have leveraged ETFs. So
• 28:52
  Speaker 3: our view is they should be short-term trading tools and
• 28:54
  Speaker 3: also keep an eye on the borrowing. Ask your fund
• 28:57
  Speaker 3: manager what the borrowing cost is versus the return on
• 28:59
  Speaker 3: the shares.
• 28:59
  Speaker 1: You're of the view they should be short-term tactical products
• 29:03
  Speaker 1: as opposed to a long-term... I'm geared to 30% into
• 29:07
  Speaker 1: the market forever.
• 29:08
  Speaker 2: Yeah.
• 29:09
  Speaker 1: Okay. Very interesting. We'll just leave it at that. Thank you.
• 29:12
  Speaker 1: And I'm sure that was very useful to you, Yogesh. Okay.
• 29:16
  Speaker 1: Declan says, on a number of occasions recently, you have
• 29:20
  Speaker 1: suggested there is an inherent contradiction in investing in private
• 29:23
  Speaker 1: credit and private equity via the ASX or listed markets.
• 29:27
  Speaker 1: There isn't. Okay. Just a context there. I continually say,
• 29:31
  Speaker 1: and I'm sorry, Declan, I'm going to say it continually,
• 29:34
  Speaker 1: that accessing unlisted assets through a listed vehicle, which can
• 29:40
  Speaker 1: crash with a share market crash, I find contradictory. But
• 29:43
  Speaker 1: I'm happy to hear new views. So Declan says, additionally,
• 29:48
  Speaker 1: ETFs themselves can invest in unlisted assets, including real estate,
• 29:53
  Speaker 1: private equity, gold, and so on. There you are. He
• 29:56
  Speaker 1: says there's no contradiction there. Now, that's good. I'm interested
• 30:01
  Speaker 1: in what he says there. It is testing my bias,
• 30:06
  Speaker 1: if you like, because the gold ETF from anybody, including
• 30:11
  Speaker 1: the original one, which was created by, it just so happens,
• 30:14
  Speaker 1: GlobalX and Marx from them, it allows you to buy
• 30:18
  Speaker 1: a physical asset in paper form. So let's just test this.
• 30:22
  Speaker 1: But let's say there was a crash, an almighty crash.
• 30:28
  Speaker 1: 1929-like share market crash. And everything crashed with it, including
• 30:32
  Speaker 1: gold ETFs. And then everybody wanted to get their money
• 30:36
  Speaker 1: out at the same time from the gold ETF. Could the...
• 30:41
  Speaker 1: I'm not talking about you, Mark. I'm just talking about
• 30:43
  Speaker 1: the ETF industry. Could it produce... Could it get the
• 30:50
  Speaker 1: gold and sell the gold dollar for dollar that's represented
• 30:54
  Speaker 1: by every piece of paper out there on listed ETFs?
• 30:58
  Speaker 3: Yes.
• 30:58
  Speaker 2: So, I mean, it's a great question, James.
• 31:00
  Speaker 1: Was that yes, they can or yes, it's a good question?
• 31:03
  Speaker 3: No, it is a good question because at the end
• 31:05
  Speaker 3: of the day, ETFs only account for a small part
• 31:07
  Speaker 3: of the overall market. It is growing. So, if there
• 31:10
  Speaker 3: is going to be a crash, it's not just going
• 31:12
  Speaker 3: to be the ETFs that are selling. It's going to
• 31:13
  Speaker 3: be active fund managers selling, institutions selling. Gold is quite
• 31:16
  Speaker 3: interesting because gold isn't just speculators or investors using gold.
• 31:21
  Speaker 3: A lot of people use gold for industrial use. Central
• 31:23
  Speaker 3: banks use them for their reserves. So, there could be
• 31:26
  Speaker 3: buyers on the other side. But the great thing about
• 31:29
  Speaker 3: an ETF is if people do want to sell, well,
• 31:31
  Speaker 3: you've got that liquidity over there, even though it is
• 31:33
  Speaker 3: considered to be an unlisted asset. It's a highly liquid market.
• 31:37
  Speaker 3: So there's always buyers and sellers. And in fact, the
• 31:39
  Speaker 3: gold market is actually a lot more liquid than some
• 31:41
  Speaker 3: share markets out there because it's so heavily traded globally.
• 31:44
  Speaker 1: That's why I think it probably does test the bias
• 31:48
  Speaker 1: that unlisted assets are sort of uncomfortably placed sometimes in
• 31:53
  Speaker 1: listed markets.
• 31:55
  Speaker 3: And I think, James, your point around the unlisted assets,
• 31:57
  Speaker 3: particularly Declan mentioned around private assets or private credit, private equity,
• 32:02
  Speaker 3: we haven't seen a lot of private credit going through
• 32:05
  Speaker 3: a default cycle because a lot of them came during,
• 32:08
  Speaker 3: were pretty much post the 2008, 2009 GFC because banks
• 32:12
  Speaker 3: refused or pretty much shut the doors to a lot
• 32:15
  Speaker 3: of lending to risky borrowers. So it'll be very interesting
• 32:18
  Speaker 3: to see how these private creditors managers go during a
• 32:21
  Speaker 3: financial crisis. What happens if investors run for the exit? Yeah,
• 32:25
  Speaker 3: I'm very interested to watch that.
• 32:26
  Speaker 1: Do I recall in the GSC that there was some
• 32:29
  Speaker 1: strain on gold ETFs and their ability to actually achieve liquidity?
• 32:36
  Speaker 2: Not entirely.
• 32:36
  Speaker 3: If anything, you saw a lot more buying within gold
• 32:38
  Speaker 3: ETFs during times of market turmoil. And that's because gold
• 32:41
  Speaker 3: has a bit more of a defensive capability to it.
• 32:44
  Speaker 2: Same with COVID as well.
• 32:45
  Speaker 3: There was no issues around buying into gold products. So yeah,
• 32:49
  Speaker 3: it's got that defensive characteristics to cushion share market volatility.
• 32:52
  Speaker 1: Okay. Okay. Thank you for that, Declan. Do appreciate the
• 32:55
  Speaker 1: correspondence and the points you make. It's certainly an area
• 32:59
  Speaker 1: where there's two sides. Okay. Final question from David. I
• 33:04
  Speaker 1: have a question I was hoping you could answer on
• 33:05
  Speaker 1: the podcast in relation to a couple borrowing to invest
• 33:08
  Speaker 1: in ETFs. If a couple are both borrowing separately in
• 33:12
  Speaker 1: their own names to invest in a diversified portfolio of
• 33:15
  Speaker 1: passive ETFs, what are the considerations for deciding who should
• 33:18
  Speaker 1: invest in Australian ETFs for the frankie and who should
• 33:22
  Speaker 1: invest in global ETFs? Because they don't have frankie. That's
• 33:26
  Speaker 1: the sort of question you're going to say, speak to
• 33:29
  Speaker 1: a financial advisor. I wouldn't blame you if you gave
• 33:31
  Speaker 1: that answer straight away, Mark. But I imagine it happens,
• 33:34
  Speaker 1: does it, when people come in buying ETFs? They can't
• 33:36
  Speaker 1: help it. They start asking questions like this.
• 33:38
  Speaker 2: They do.
• 33:39
  Speaker 3: I would not say to speak to a financial advisor.
• 33:41
  Speaker 3: I'd say to speak to a tax accountant because they are.
• 33:42
  Speaker 2: The professional when it comes to tax.
• 33:44
  Speaker 3: That being said, I would say that a lot of
• 33:46
  Speaker 3: people use ETFs for its tax efficiency, right? When it
• 33:50
  Speaker 3: comes to high income versus medium income earners, again, I'm
• 33:53
  Speaker 3: not giving tax advice, but you're right. Who answered the
• 33:56
  Speaker 3: question around Australian versus global shares. If you invest in
• 33:59
  Speaker 3: Australian shares, they do have a lot more distributions that
• 34:02
  Speaker 3: are treated as dividends, which means that, you know, they
• 34:05
  Speaker 3: can use the franking credits to offset their tax liability
• 34:08
  Speaker 3: and But tax should never be a reason to invest.
• 34:10
  Speaker 2: It's more byproduct.
• 34:11
  Speaker 3: And keep in mind that if you're investing in global shares,
• 34:14
  Speaker 3: they have more capital growth potential versus the Australian market,
• 34:18
  Speaker 3: which has dividends. But the thing about an ETF is
• 34:20
  Speaker 3: that the ETF packages those capital gains when it rebalances
• 34:24
  Speaker 3: and distributes it as an income, right? As a similar
• 34:27
  Speaker 3: to a dividend, but it forms part of a distribution.
• 34:29
  Speaker 3: So that will still be treated as income for that investor.
• 34:32
  Speaker 3: So it's always hard whether you're high income versus medium
• 34:35
  Speaker 3: income owner to be deciding what to do. But yes,
• 34:38
  Speaker 3: if you are a high income earner and you want
• 34:40
  Speaker 3: those franking credits to offset that tax liability, then it
• 34:43
  Speaker 3: can make sense to be more heavily weighted to Australian shares.
• 34:46
  Speaker 3: Just keep in mind to be diversified and there are
• 34:48
  Speaker 3: capital gains implications from the global share component too.
• 34:52
  Speaker 1: Okay, terrific. Really good answer. Thank you. And remember, none
• 34:55
  Speaker 1: of this is ever advice. This is information only as
• 34:57
  Speaker 1: you all know by now, but I must say it
• 35:00
  Speaker 1: every week. Okay, very good. Hey, Mark Jochum from GlobalX,
• 35:04
  Speaker 1: the ETF house. Thank you very much for coming on
• 35:06
  Speaker 1: the show.
• 35:07
  Speaker 2: Thanks for having me, James. Really appreciate it.
• 35:09
  Speaker 1: Great to have you on the show. We'll have you again.
• 35:11
  Speaker 1: Thank you very much for coming on. Okay, everybody. Now,
• 35:14
  Speaker 1: a few things. If you would, it would be really
• 35:17
  Speaker 1: good if you would mention us to someone you know
• 35:20
  Speaker 1: about the show. We'd love that. You can drop a
• 35:22
  Speaker 1: Google review, too, if you'd like. That would be very nice.
• 35:25
  Speaker 1: And the email, I have mentioned it more than once,
• 35:28
  Speaker 1: but here it is once more, themoneypuzzle at theaustralian.com.au. Today's
• 35:33
  Speaker 1: show was produced by Leah Simangalu. Talk to you soon.
• 35:41
  Speaker 1: Thank you.