Blue Chip speaks to Andrew Brotchie, MD, Glacier International.
Please tell us about the new exchange traded funds (ETFs) that are available direct on the Glacier International platform.
Clients have always had the ability to buy ETFs, but it required them to open a custodian account within our platform and then to trade directly with a third-party provider. We’ve recently made available a range of ETFs directly on the platform. They can be traded directly by our clients who have unit trust portfolios.
ETFs are very successful overseas and we do have a way to go to catch up with this trend locally. We feel it was an important step in our evolution to be able to offer our clients direct access to these investment opportunities on the platform. It’s about us expanding the ability for our clients to access the various ways of gaining international exposure in their portfolios.
ETFs help clients control their cost of investing. An ETF is a straightforward option to get access to international investment opportunities without having to do research oneself to try to find the best actively managed options in a foreign country.
Why invest in an ETF?
Cost is a big driver. The other benefit is straightforward index exposure to different opportunities. It allows quick-and-easy access from a flexibility perspective. You don’t necessarily have to research which fund is the most appropriate for a specific area or sector; you can buy the ETF that covers an index relevant to that area or sector.
The Global Life Plan, an offshore endowment, offers investors financial planning benefits including estate planning advantages and solvency protection.
How does Glacier International select its ETFs?
We offer a range of ETFs that our research team has selected. We have a core offering that covers the major markets around the world, such as the MSCI World, MSCI Emerging Markets, S&P 500, Euro Stoxx 50, Japan, and Developed Markets Property Yield indices. We also have thematic (ESG) and specialist ETF offerings, like gold.
Please provide an overview of the Global Life Plan.
The Global Life Plan, an offshore endowment, offers investors financial planning benefits including estate planning advantages and solvency protection.
Glacier International is responsible for the calculation, collection and administration of any tax due, therefore the investor has no personal tax administration to take care of. Any tax paid may be less than they would pay in their personal capacity, depending on their tax rate.
International estate duty rules won’t apply in the case of the Global Life Plan. In addition, the investor can nominate beneficiaries to receive the funds on their death, and these funds will not form part of the winding up of the estate.
Why does an offshore life wrapper – or endowment structure – make sense?
Traditionally, as South African markets started opening and people started taking advantage of international opportunities, they would either go direct or set up an offshore trust, typically.
Today, offshore life wrappers are the preeminent vehicle for investing money offshore. They offer many of the same benefits as trusts, often with significantly reduced costs, as well as providing administrative flexibility to manage international portfolios that can span many jurisdictions. Their financial planning benefits – as set out above – as well as their ease of administration really can help to simplify the management of a client’s international investment exposure.
