What the BetaShares HEUR does for investors
The BetaShares HEUR ETF provides investors with exposure to the largest companies from within the Eurozone, while also generating a large portion of their revenues outside the Eurozone.
As at the end of last month, the HEUR ETF had $22.62 million of money invested. Since its funds under management (FUM) or ‘market cap’ figure of less than $100 million, it’s important to consider if this ETF is still too small. At Best ETFs we say an ETF with more than $100 million invested is typically more sustainable than one with less than $100 million (at least). However, there are exceptions to this rule of thumb, especially if the ETF issuer/provider is committed to growing the ETF’s FUM to the point where it becomes profitable.
Fees & costs
The yearly management fee on the HEUR ETF is 0.58%. The issuer, BetaShares, takes this out automatically.
What this fee means is, if you invested, say, $2,000 in the HEUR ETF for a full year you could expect to pay management fees of around $11.60. This fee is different from the fee you pay to your brokerage provider (e.g. CommSec, NabTrade, SelfWealth, etc.) to buy or sell the ETF. Importantly, you should also be mindful of the ‘spread‘ for the ETF.
Is the ETF too expensive?
The easiest way to know if the ETF is too costly is to compare it with other ETFs in the same sector, and against the industry average. The average management fee (MER) across all of the ETFs covered by Best ETFs Australia is 0.5%, which is around $10.00 per $2,000 invested. Small changes in fees can make a big difference after 10 or 20 years. To understand all of the fees, you should read the HEUR Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it has the complete and up-to-date information.
Side note: did you know you can access our full review of the HEUR ETF by clicking here?
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Why does the BetaShares QAU ETF do?
The BetaShares QAU ETF provides investors with exposure to the performance of gold bullion, hedged into Australian dollars.
At the end of May 2020, QAU’s FUM stood at $238.31 million. With QAU’s FUM over $100 million, we say the ETF has met our minimum criteria for the total amount invested. However, in reality, a very sustainable ETF in the Index sector should be able to scale well beyond that amount.
Are QAU’s fees too high?
BetaShares charge a yearly management fee of 0.59% for the QAU ETF. Meaning, with $2,000 invested for 12 months you can expect to pay a base management fee of around $11.80.
The management fee is above the average for all ETFs on our radar, but keep in mind the ETF may be able to justify it.
If you want to learn more about the QAU ETF, you should know that you can access our free investment report.