With so many ETFs listed on the Australian stock market, choosing the right one can feel overwhelming. Many ETFs focus on a single asset type, like Australian shares or overseas bonds. If you only invest in one type of investment, there’s more risk. That’s why spreading your money across different types of investments can help. One easy way to do this is with diversified ETFs.
What sets diversified ETFs apart?
A diversified ETF is a fund that holds different types of asset classes like shares and bonds, all in one single investment. This helps lower risk while still offering the chance to grow your money. ETFs suit a range of long-term financial goals and risk levels.
For example, you can choose from conservative, balanced, growth, or high-growth ETF options. The more conservative funds hold more bonds. The high-growth funds hold more shares.
Examples of diversified ETF categories:
- Conservative: 70% bonds, 30% shares
- Balanced: 50% bonds, 50% shares
- Growth: 30% bonds, 70% shares
- High growth: 10% bonds, 90% shares
- All growth: 100% shares
- Income-focused: 40% bonds, 60% shares
Each option holds a mix of local and international shares and bonds, giving you access to a broad range of investments in one fund.
How to use diversified ETFs
Diversified ETFs can be the foundation of your investment strategy or be your whole plan. They’re a great option if you want a simple setup or are just getting started. You can also mix them with other types of investments.
Why diversified ETFs are a good choice
These funds are typically low-cost, making them a budget-friendly option. They also offer global exposure, helping to reduce the risk of concentrating your investments too narrowly. By choosing a single diversified ETF, you can access a wide range of assets without the need to manage multiple funds
LBW’s Geelong financial advisers can help you choose the right diversified ETFs for your investment strategy. They will discuss your financial goals and assist you with selecting the right mix for your portfolio.
Partner with LBW for smarter investing
LBW’s experienced Geelong financial planning team works with individuals to build smarter, more balanced portfolios. To learn more about diversified ETFs or get help improving your investments, call (03) 5221 6111 to book an appointment with our financial advisers.
