How to navigate this market volatility with ETFs
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They say market meltdowns make an investor (a lot of money if they're wise, that is). That said, trying to pick the winners when the rest of the market is running for the hills isn't exactly easy.
After all, the S&P/ASX 200 has dropped more than 12% since the beginning of the year, while the S&P/ASX 200 VIX Index - the gauge of expected volatility for the Aussie stock market - has lifted nearly 60%.
It hasn't been easy for the country's top stockpickers either. From what we can see from ASX Fund data, more than 40% of Australian equity managers underperformed the benchmark over the 12 months to the end of May. Meanwhile, SPIVA data shows that 73.45% of active managers underperform the S&P/ASX 200 over a five-year period.
It therefore begs the question, is a passive approach a safer bet?
So in this episode, Livewire's Ally Selby was joined by Shaw & Partners' Felicity Thomas and Apt Wealth's Sarah Gonzales for their thoughts on using active or passive products to navigate market volatility.
Plus, they also share the number one question they are hearing from clients right now, as well as one ETF that they are recommending to clients to help sail through these stormy markets.
Note: This video was shot on Wednesday 6 July 2022. You can read the transcript below: