The tax regime for investment funds (including ETFs) is pretty draconian which is why I am of the view that investment trusts are generally a better option for collective investment in equities outside of a pension fund.
As an aside, I am often surprised at the number of people on here that invest in equities outside of tax-deferred retirement vehicles, given that the
fact that the vast majority of people don't even maximise their pension contributions. Each to his own I suppose.
A relatively new low cost fund (0.49% TER) has recently opened up on the Irish exchange. The Wisdom tree ISEQ 20 ETF, with dividend payments distributed semi annually.
http://www.ise.ie/Media/News-and-Ev...er-of-ETFs-lists-ISEQ-20®-ETF-on-the-ISE.html
As an inexperienced investor I would consider buying into this fund as part of maybe a 20% portion of a mixed portfolio.
Pros-
No currency conversion costs.
I am concerned that over a 10-20 year period the Euro will strengthen and de-value profits from non Euro denominated fund. A Euro denominated fund like this mitigates the risk.
The fund offers a relatively mixed portfolio of Irish assets.
Total expense ratio TER a reasonable 0.49%
No stamp duty.
Wisdom tree has over $50bn AUM (Assets under management) globally
Cons
Gross roll up rules apply including no loss relief, gains taxed at 41%, deemed disposal after 8 years. Not sure how dividends are taxed under these rules ?
Any other thoughts concerns?
biggest negative is that most companies on it are very expensively valued
the DAX is 25% cheaper than the ISEQ right now
biggest negative is that most companies on it are very expensively valued
the DAX is 25% cheaper than the ISEQ right now
What exactly does that mean?
Expensively valued ..... as in the share prices of the stocks are trading at a premium? I.e. Above their net asset value
How do you know that the Dax is 25% cheaper. Where does that information come from?
I looked over your post again about vanguard ETF's on the Amsterdam stock exchange and found this.
http://www.etfstrategy.co.uk/vangua...n-nyse-euronext-in-amsterdam-and-paris-48652/
The TERs look good, also the fact that they are denominated in Euro avoids currency exchange fees. Shame about the complex tax issues.
From your earlier comments is the Amsterdam stock exchange over valued, as these ETFs are also available on the French stock exchange.
The stock exchange where an ETF is listed has no bearing on the NAV of the ETF. The exchange is simply the place where the securities are traded - most European ETFs are listed on multiple exchanges but trade at essentially the same price regardless.
Sarenco, I have to consult that AIC website glossary of terms every time you write a post!!!! Ha ha
But it's all part of the learning experience!!
I understand that, but would galway_blow_in have meant that THE INDIVIDUAL stocks within this fund would be overvalued, (I.e. If you bought any of them outside of the fund it would be trading at a premium) therefore this fund in its entirety would be overvalued compared to for example a vanguard world ETF fund?
What exactly does that mean?
Expensively valued ..... as in the share prices of the stocks are trading at a premium? I.e. Above their net asset value
How do you know that the Dax is 25% cheaper. Where does that information come from?
I looked over your post again about vanguard ETF's on the Amsterdam stock exchange and found this.
http://www.etfstrategy.co.uk/vangua...n-nyse-euronext-in-amsterdam-and-paris-48652/
The TERs look good, also the fact that they are denominated in Euro avoids currency exchange fees. Shame about the complex tax issues.
From your earlier comments is the Amsterdam stock exchange over valued, as these ETFs are also available on the French stock exchange.
This is essentially the same as saying that the multitude of market participants in the global equity market have mis-priced both the Irish and German markets. You may of course be proved correct but I don't see how you could possibly say this with any degree of confidence.
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