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Surge in financial advisors recommending low cost ETFs

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New research has uncovered a growing trend among financial advisers recommending low-cost exchange-traded funds to their clients, indicating a shift towards more cost-effective investment strategies.

According to recently released data from wholesale trading platform AUSIEX, nearly a third (30.9%) of buying volumes directed by advisers went into ETFs in 2023, marking a significant increase from the quarter seen in 2022.

The adoption of ETFs was particularly pronounced among younger advised investors, with ETFs constituting almost half (49.2%) of buy trades facilitated by advisers for individuals aged between 18-24. This represents a notable 5% uptick from the previous year.

Steady growth

Similarly, for those aged between 25-49, ETFs accounted for more than a quarter (24.7%) of the buying volumes from advisers in 2023, reflecting a steady growth trajectory over the past two years.

Brett Grant, Head of Product, Marketing & Customer Experience at AUSIEX, emphasized the increasing significance of ETFs in advisers’ investment strategies, particularly amid market uncertainty.

“ETFs have become an increasingly important part of advisers’ investment strategies, in part due to market uncertainty,” said Grant. “Today, ETFs continue to offer a diversified, low-cost exposure to an index or specific thematic, allowing advisers and their clients to gain exposure to a range of asset classes in a single transaction.”

Balanced portfolio

Grant highlighted the versatility of ETFs in constructing well-balanced portfolios tailored to individual risk tolerance and financial goals, adding that they present opportunities for advisers to engage with the next generation of investors by aligning investment options with client values.

He outlined three key advantages driving the popularity of ETFs among advisers:

1. Diversification: ETFs enable exposure to various asset classes, investment trends, and regions, facilitating instant diversification for investors.

2. Cost Efficiency: ETFs are known for their low costs compared to managed funds, providing value for clients seeking cost-effective investment solutions.

3. Liquidity and Transparency: ETFs trade on stock exchanges like individual stocks, offering intraday liquidity. The transparent nature of ETF holdings allows advisers to make well-informed investment decisions.

The findings underscore a broader industry shift towards embracing ETFs as a preferred investment vehicle, driven by their affordability, versatility, and potential for portfolio diversification.

Ahron Young is an award winning journalist who has covered major news events around the world. Ahron is the Managing Editor and Founder of TICKER NEWS.

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Money

Dow struggles, investors lose confidence amid trade fears

Dow on track for worst April since 1932 amid trade uncertainty and investor ‘no confidence’ signals, as losses deepen.

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Dow on track for worst April since 1932 amid trade uncertainty and investor ‘no confidence’ signals, as losses deepen.

In Short

The Dow Jones fell almost 1,000 points, heading for its worst April since 1932, with investors worried about trade restrictions and the future of the Federal Reserve Chairman.

Amidst declining stock confidence, traditional safe assets like bonds are under pressure, while gold prices have soared as investors seek safety.

The Dow Jones Industrial Average dropped nearly 1,000 points on Monday, heading towards its worst April since 1932. The S&P 500 has recorded its worst performance for any president at this stage since 1928.

Investors are concerned about trade restrictions and the potential removal of Federal Reserve Chairman Jerome Powell by President Trump, leading to fears of further losses. Many doubt that the administration’s trade negotiations will provide timely relief.

Traditional safe assets like government bonds and the U.S. dollar are also under pressure, limiting safe investment options during this instability. Chief investment officer Scott Ladner noted that this reflects a widespread “no confidence” sentiment among investors.

Tax cuts and deregulation

Following Trump’s election, stock indexes initially rose due to optimism around tax cuts and deregulation. However, the introduction of aggressive tariffs sparked significant market declines. Although there was some retraction of tariff plans, markets have not stabilised.

Typically, bond prices should increase during stock declines, but yields on 10-year U.S. Treasurys have risen, indicating a sell-off in government bonds.

The U.S. dollar has weakened due to economic concerns and Trump’s tensions with the Fed, hitting a three-year low. In contrast, gold prices have surged to all-time highs as investors seek safer assets.

Wall Street sentiment is declining, with bearish expectations remaining high for eight consecutive weeks, marking a record for prolonged pessimism among individual investors.

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Money

Trump warns of economic slowdown unless interest rates are slashed

Trump criticizes Fed’s Powell over interest rates, warning of economic slowdown, as markets react sharply.

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Trump criticizes Fed’s Powell over interest rates, warning of economic slowdown, as markets react sharply.


President Donald Trump has once again lashed out at Federal Reserve Chair Jerome Powell, claiming the U.S. economy could “slow down” if interest rates aren’t cut immediately.

Markets reacted sharply, with bond yields jumping and equities falling as investors brace for a possible standoff between the White House and central bank.

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Money

Dow falls nearly 1,000 points amid market turmoil

Dow Drops Nearly 1,000 Points as Market Turmoil Grows Amid Tariff Concerns and Fed Leadership Threats.

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Dow drops nearly 1,000 points as market turmoil grows amid tariff concerns and Fed leadership threats.

In Short

The stock market fell significantly on Monday, with the Dow losing nearly 1,000 points, raising concerns over President Trump’s trade policies and Federal Reserve leadership.

Additionally, the dollar plummeted to multiyear lows, while gold prices surged to a record high.

On Monday, the stock market experienced a significant decline, with the Dow industrials closing nearly 1,000 points lower. This downturn is part of a troubling trend, as April is on track to be the worst month for the market since 1932.

The value of the dollar also fell, reaching multiyear lows against major currencies like the euro.

Investor concerns are mounting over President Trump’s ongoing tariff war and his threats to remove Federal Reserve Chairman Jerome Powell. On social media, Trump called for lower interest rates, suggesting that economic slowdown is possible if action is not taken promptly.

National Economic Council Director Kevin Hassett indicated on Friday that the administration is dissatisfied with Powell’s performance and is considering his potential removal.

Export worry

Data from South Korea revealed a significant decrease in exports to the United States this month, further heightening market anxiety.

All major stock indexes reported losses, with the Nasdaq witnessing the largest decrease of around 2.5%. Key technology shares, including Tesla, Nvidia, and Apple, also fell sharply.

The ICE U.S. dollar index decreased by over 1%, marking its lowest value in three years against a basket of currencies. Treasury yields increased, the 10-year note reaching 4.39%.

Meanwhile, gold prices surged to an unprecedented $3,400 per troy ounce, and Bitcoin prices rose. Japan’s Nikkei index fell by 1.3%, while China’s CSI 300 managed a slight increase of 0.3%. Markets in Hong Kong and Europe remained closed for the Easter holiday.

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