# ANZ ASX 200 Index Fund



## boozealot (10 May 2009)

Hi Folks

Just looking to get people thoughts (good idea/bad idea, why) on the ASX200 index fund offered by ANZ?


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## Jack Payback (10 May 2009)

*Re: ASX 200 Index Fund*

There is an alternative, which is a listed fund. 

SPDR S&P/ASX 200 FUND

Not knowing what the management fees for the ANZ are, but usually listed funds are cheaper than unlisted ones. And there is no entry or exit fees.

Also quicker to redeem funds when you need them. You would be looking at least 1-2 weeks for the ANZ fund to get your money out, the listed funds you can have back in 3 days.


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## jono1887 (10 May 2009)

*Re: ASX 200 Index Fund*

Whats the code for it??


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## awg (10 May 2009)

*Re: ASX 200 Index Fund*

stw

google that stock code, that links to their website, shows full details, including very low commission


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## SWR (10 May 2009)

*Re: ASX 200 Index Fund*

Vanguard  have also just listed a range of EFT's 
Have a look at ASX Code VAS. Details on  www.vanguard.com.au


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## So_Cynical (10 May 2009)

*Re: ASX 200 Index Fund*

STW – SPDR ASX 200 Fund – Exchange traded Index tracking fund 

https://www.aussiestockforums.com/forums/showthread.php?t=14461

http://www.spdrs.com.au/etf/fund/fund_detail_STW.html


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## boozealot (11 May 2009)

*Re: ASX 200 Index Fund*

Thanks everybody.

Do you guys have any opinions on unlisted over listed index funds?


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## SWR (11 May 2009)

*Re: ASX 200 Index Fund*

The Vanguard Index Australian Shares Fund and their new VAS listed Fund both track the ASX 300.
Their website compares the two and as they offer both the comparison is fairly impartial.
A point to note however is the fees on their unlisted fund are 0.75% while the VAS listed fees are .27%


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## Jack Payback (11 May 2009)

*Re: ASX 200 Index Fund*

The performance of the listed or unlisted funds should be identical, as it tracks the index.

They are a vanilla type fund as the managers don't make any active investment decisions which keeps the costs down, this decreases some risk in that the manager can't make bad decisions, you are still open to general market risk however. So all index funds should be the same.

Generally, the listed ones are the better option, as there is no commissions to be paid, to advisers, or platforms or master funds. If you want an index fund you don't need an adviser anyway, as they can't add any value. 

I would go with the listed index fund, as it's easier to get your money out quick and they are cheaper to achieve the same result. Half a percent in fees can have a big impact on your end result over a 20 year time frame, lowering performance by tens of thousands of $$$$. You have to think about your time frame though. Is it short, medium, or long term?


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## jono1887 (11 May 2009)

*Re: ASX 200 Index Fund*

so how do they work? do they buy stocks in the same proportion to the ASX200?


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## SWR (11 May 2009)

*Re: ASX 200 Index Fund*

I understand they buy the top 270 stocks in order to avoid brokerage costs on the bottom 30 which tend to move in and out of the Index


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## Jack Payback (12 May 2009)

*Re: ASX 200 Index Fund*

The fund manager will mimic the makeup of the index. The index is weighted to market capitalisation. 

So if BHP makes up 10% of the index, the fund will be 10% BHP stock. They have to buy and sell various shares each day as the prices change and the makeup of the index by weight for each company changes.


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## beamstas (12 May 2009)

Why not just buy SPI Contracts and save on brokerage


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## sails (12 May 2009)

beamstas said:


> Why not just buy SPI Contracts and save on brokerage




Brad, I think most index funds pay distributions which you don't get on the SPI.


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## Jack Payback (12 May 2009)

Will a long term buy and hold strategy work for SPI contracts? I have never used them.


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## Blue Monday (17 May 2009)

Jack Payback said:


> So if BHP makes up 10% of the index, the fund will be 10% BHP stock. They have to buy and sell various shares each day as the prices change and the makeup of the index by weight for each company changes.




Just a small clarification - prices going up and down does not require an index fund to rebalance. For example if stock XYZ goes up 10% while the market is flat, its weighting goes up 10% in the index because its market cap is higher, but its weighting also goes up in the index fund by the same amount. Rebalancing is only needed when companies enter/exit the index quarterly, or when the number of shares a company has on issue changes.



Jack Payback said:


> Will a long term buy and hold strategy work for SPI contracts? I have never used them.




Probably not as well as you would have to roll the contracts every few months, there is basis risk/roll risk so you may actually lag behind the index, and you obviously don't get franking credits this way


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