“The resource sector has again outperformed on a yearly basis with investors in our Metals & Mining ETF enjoying returns of 21%, almost double that of the ASX 200 index,” said Annmaree Varelas, Aii CEO.

This is consistent with the long-term trend for resources, with the Metals & Mining, Resources and Energy sectors all outperforming the ASX 200 over a five-year period.

Local ETF researcher, PennyWise Investment has for the last 12 months taken an overweight position in resource-based ETFs within their model portfolios, and their view isn’t likely to change in the near future.

“Although commodity prices are likely near their peak for the next year or so, the demand profile facing Australian resource companies remains strong and valuations are far from expensive.  The local resources sector also retains good relative price momentum in global markets, and remains among our preferred ETF exposures within our satellite model portfolio,” said David Bassanese, Managing Director of PennyWise Investment.

“Sector ETFs can maximise portfolio returns with income and growth opportunities. An investor seeking higher income could look to invest in the Aii Financials x-A-REITs ETF with a grossed up yield of 8.22% or capitalise on long-term growth with the resource ETFs,” said Ms Varelas.“In both instances, it takes away the guess work for investors over which stock to pick, minimising the stock specific risk in portfolios.” said Ms Varelas.

“Research has shown 70-80% of a stock return is generated by the market and the sector, not the stock. So taking a market view by picking the right sector, you are 70% of the way there,” said Ms Varelas.

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• Average weekly earnings rose by 0.4 per cent in the three months to August with private sector earnings up just 0.2 per cent and public sector wages up 1.5 per cent. Wages rose by 4.5 per cent over the year.
• Over the year male wages rose by 4.3 per cent while female wages rose by 5.0 per cent. The average wage stands at $65,457. The highest average wage can still be found in the mining sector, at $107,510 per year.
• Wages in the ACT ($75,936) remains well ahead of the other states and territories due its large public sector. However the clear surprise in wage growth has been the Northern Territory ($64,745), which has
  now elevated itself ahead Queensland ($64,407) and Victoria ($63,809) in the pay stakes.
• The ABARE Mineral and energy major projects publication has confirmed that the mining sector is once again ramping up investment. In the six month to October, 72 projects were at an advanced stage of
  development, totalling a record capital expenditure of $132.9 billion.

Click here to download this document (pdf)

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• Australia’s population grew by 403,082 people over the year to March. Population growth consolidated,
  increasing by 1.8 per cent over the past year, however continuing to ease from the 40 years highs reached
  in the year to March 2009.
• Not only is Australia experiencing healthy migration levels but also a baby boom. There were 303,500
  babies born in the year to March, – the most since quarterly records began 28 years.
• Across the state and territories, it was the mining states of Western Australia and Queensland that
  recorded the fastest annual population growth rates – a trend that is likely to gain traction in coming
  years. South Australia’s population growth held just shy of the fastest pace since the mid 1970s.

Click here to download this document (pdf)

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• Petrol prices have risen for the first time in five weeks. The Australian Institute of Petroleum reports that the average Australian petrol price rose by 3.6 cents a litre last week – the biggest weekly price gain in seven months. The national pump price stands at a 3-week high of 122.7 cents a litre.
• While pump prices rose sharply last week as massive discounts ended, the good news is that the wholesale price continues to fall, hitting a 10-month low.
• The Reserve Bank Governor has delivered a talk: “Monetary Policy and the Regions”. The key point the Governor wanted to get across is that the Reserve Bank is listening – alert to the needs, concerns and differences across the country.

Click here to download the document (pdf)

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