The growth of assets under management in the Australian exchange-traded funds (ETF) market has exploded over the past three years to around $125 billion. ETFs enable investors to gain exposure to a wide range of assets at relatively low cost and generally replicate their investment benchmarks closely.
With over 270 listed on the ASX, how do you choose in which to invest? For most retail investors the main choice comes down to Australian based or international?
When it comes to Australian based ETFs there are 4 which stand out -
- Vanguard’s Australian High Yield ETF (VHY) has a 3 year return of 9.1% pa with a 32% return over the past year.
- Blackrock’s iShares ASX 20 ETF (ILC) earned a return of 9.8% pa over the past 3 years including 32.9% over the last 12 months.
- VanEck’s Australian Sustainable Equity ETF (GRNV) achieved a 3-year return of 11.5% pa and a one-year return of 25.7%
- State Street SPDR ASX 50 ETF (SFY) returned 9.3% pa for 3 years and 27.6% for the last year.
For the International based ETFs, three ETFs caught our attention in sectors not well covered by Australian investments –
- Morningstar’s Global Technology ETF (TECH) with 3 year return of 24% pa achieved 30.8% for the past year.
- BetaShares’ Cybersecurity ETF (HACK) earned 22% pa over 3 years and 43.8% over the last 12 months.
- On the Global Sustainability front, BetaShares ETHI ETF returned 24.4% pa over 3 years and a staggering 32.8% over the last year.
Would your portfolio benefit from including such ETFs? We always advise you to look before you leap when it comes to investing and to know what you are investing in. Spend four hours with us at the Virtual Investment Forum on 23 November to learn all you need to know about investing in ETFs.