Invesco considers ETFs for Australia

High dividend and clean energy may appeal

By Vishal Teckchandani
Tue 23 Jun 2009

Invesco is considering some of its PowerShares suite of ETFs for the Australian market, Invesco Australia chief said.

Global asset manager Invesco is considering bringing some of its PowerShares suite of exchange-traded funds (ETFs) to the Australian market, Invesco Australia chief executive Mick O'Brien told InvestorDaily.

"If you look at our [global] product range, you can invest in particular industries or sectors or sub-sectors or into particular themes like global water, global clean energy and other forms of renewable energy including nuclear and wind," he said.

"Our product range also covers commodities like metals, agriculture, oil or coal, so it gives you easy access to an investment idea or theme.

"I think the things that Australian investors might like is things like a commodities ETF, as it's a way of playing the commodities cycle but not having the company risk of say investing in BHP Billiton and Rio Tinto."

O'Brien said Australian investors might also like ETFs focused on high dividend paying companies or ETFs based on indices that are not simply market weighted, but weighted by other factors such as sales, revenue or profit.

PowerShares, founded in 2003 in Illinois as an independent ETF provider, was bought by Invesco in 2006.

ETFs trade exactly like common shares and are listed on the Australian Securities Exchange (ASX) and other exchanges. Most ETFs replicate the performance of an index.

ETFs are huge in the US but have been a niche sector in Australia and issuers believe there is a lot of potential for the sector to grow in the local market, Lonsec general manager of research Grant Kennaway said.

iShares, State Street Global Advisors, Vanguard Investments Australia and ETF Securities already have ASX-listed ETFs.

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