Unit trusts are actively managed investments, whilst ETFs are normally tracker funds and only tracks a certain index, for example the ALSI/FTSE 40 that is tracked by the Satrix 40.
ETFs are normally a cheaper investment because there are no fund management involved, like with an actively managed unit trust, but CHEAPER is not always the best.
A tracker fund cannot change its composition due to market changes like a unit trust can, for instance resources have been suffering for a long time, but there are quite a number of resource shares in the ALSI/FTSE 40.
The underperformance is clear from the following example, where the ETF funds are compared to unit trusts within the same grouping, over the last year:
|Satrix Divi:||160th out of 162 funds|
|Satrix 40:||9th out 13 large cap funds|
|Performance of some of the other ETFs:|
|Satrix Fini:||7th out of 9 funds|
|DBX-trackers MSCI World Index ETF:||17th out of 34 funds|
|Satrix Indi:||4th out of 9 funds|
|Source: Funds on Friday, 30 November 2013|
Please note that this performance is not necessarily an indication or guarantee for the future.
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