Investment Ideas


US Equities

Access the world’s largest market

Most Australian investors hold highly concentrated portfolios focused on the local stock market. And as a result, are highly exposed to Australian economic cycles. By investing in US equities, you can gain exposure to a larger and more diverse economy.

Quick Links


US Market


3 Reasons to Diversify portfolios into the US Market

The United States’ flagship benchmark of US large capitalisation equities, the S&P 500®, offers investors the opportunity to:

  1. Diversify into the world’s largest market. Australian investors, like most, have a love affair with their home market. As a result, investors could gain significant diversification benefits from allocating some of their investments globally, including to the US – compared to the S&P/ASX 200, the S&P 500 offers vastly higher stock diversification.
  2. Harness the growth potential of the US economy. Diversifying into the US market gives investors the opportunity to tap into the growing momentum of the world’s biggest economy as it bounces back from the global financial crisis of 2008–09. Recently, the US economy has recorded healthy growth, with indications the economy will continue to strengthen.
  3. Access underrepresented sectors. The US market gives investors access to industries typically absent or underrepresented in the Australian economy, such as IT, pharmaceuticals and defence. It also offers the opportunity to access the growth potential and market power of some of the world’s biggest companies, which represent a significant part of global equity market capitalisation, revenue and earnings.

 

Diversifying into the US with SPDR ETFs

Previously, the complexity of investing offshore may have deterred Australian investors and SMSFs from accessing the diversification benefits and growth potential of the US market. The world’s most widely traded ETF1, SPDR S&P 500® ETF (SPY) gives investors the opportunity to tap into the world’s economic powerhouse. It tracks the performance of America’s top 500 companies. 

SPY seeks to provide investment results that, before expenses, correspond to the performance of America’s largest blue-chips through the S&P 500 Index. It gives investors exposure to 500 US stocks, across 24 industry groups, in one single investment. 

Related products


Facts About Us


We Built the First US ETF

We pioneered ETFs as a simple, cost effective means of investing in the performance of market indices, with all the benefits of listed market liquidity.

With the American Stock Exchange, we developed and launched the SPDR S&P 500® ETF, the first of its kind in the US. Each new member of the SPDR ETF family reflects our intimate knowledge of the ETF market and over 35 years of indexing experience.

As with our first ETF, all our ETFs are physically backed to closely replicate the performance of each index. 

Launch of SPY at the NY Stock Exchange

1Source: State Street Global Advisors, Bloomberg Finance, L.P. as of 31 May 2019.