Finance & Fury Podcast

Though banks bear much of the blame for previous financial crises, ordinary investors play a more central role than most people realise… …through greed, and fear. Ironically, it is likely to occur through a vehicle which has been created with just that in mind – exchange-traded funds, or ETFs Listed funds are passive by nature, designed to track the performance of an index of stocks, bonds, currencies or commodities, rather than to pick and choose among individual companies. The ETFs are very popular; The simplicity and low costs But they could be a time bomb for global markets. Australia – Only listed in Australia in 2009, when it was cheap to buy shares (after the GFC) The popularity of ETFs has soared in the past decade. Passively managed have nearly doubled = 40 per cent of Funds under management (in America) Vanguard alone owns a position greater than 5 per cent in 491 of the stocks on the S&P 500, adding up to nearly 7 per cent of the index's total market cap. Japan, where the central bank owns