Australian ETFs on watch: BetaShares QAU & Vanguard VVLU

On the ASX, the BetaShares Gold Bullion ETF – Currency Hedged ETF (ASX: QAU) and Vanguard Global Value Equity Active ETF (Managed Fund) ETF (ASX: VVLU) are two ASX ETFs worthy of closer inspection.

What the BetaShares QAU ETF does for investors

The BetaShares QAU ETF provides investors with exposure to the performance of gold bullion, hedged into Australian dollars.

According to our most recent data, the QAU ETF had $317.65 million of money invested. With QAU’s total funds under management (FUM) figure over $100 million, the ETF meets our team’s minimum investment criteria for FUM levels. As a general rule, our team draws the line at $100 million for ETFs in the Commodities sector because we believe that, relative to smaller ETFs, achieving this amount of FUM lowers the chance that the ETF issuer will close the ETF.

Fees to consider

According to our numbers, the annual management fee on the QAU ETF is 0.59%. The issuer, BetaShares, collects this fee automatically.

Meaning, if you invested $2,000 in the QAU ETF for a full year you could expect to pay management fees of around $11.80. This fee is different from the fee you pay to your brokerage provider (e.g. CommSec, NabTrade, SelfWealth, etc.), which is the fee to buy or sell the ETF. In addition to a management fee charged by the issuer, be mindful to check the ‘spread‘ for the ETF.

A fee comparison

Fees aren’t the only key consideration for ETF investors, but it’s an easy thing to do. To understand if the ETF you’re looking at is too costly, compare it with other ETFs from the same sector, and against the industry average. For example, the average management fee (MER) across all of the ETFs covered by the Best ETFs Australia team was 0.51%, which is $10.20 per $2,000 invested. Keep in mind that small changes in the fees paid can make a big difference after 10 or 20 years. You should read the QAU Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it will detail the fees, tax implications and the latest information.

Side note: did you know you can access our full review of the QAU ETF by clicking here?

What does the Vanguard VVLU ETF do?

The Vanguard VVLU Fund is an actively-managed ETF which invests in small, mid and large-cap companies across global equity markets, focusing on companies which have low prices relative to fundamental measures of value.

With our numbers for July 2020, VVLU’s FUM stood at $21.19 million. Given it has less than $100 million invested, ask yourself (or your adviser) if the ETF is still too small (and if you should wait to buy into it). If you’re concerned the ETF might not be established enough, compare it alongside one of the other Value sector ETFs, using our full list of ETFs.

Are the fees for the VVLU ETF bad?

Vanguard, the ETF issuer, charges a yearly management fee of 0.28% for the VVLU ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $5.60.

The management fee is above the average for all ETFs on our list of ASX ETFs, but keep in mind the ETF may be able to justify the higher price tag with superior performance over time.

If you want to learn more about the VVLU ETF, you should know that you can access our free investment report.

From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

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Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

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From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

Low fees? Check.

Long-term growth potential? Check.

Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

Simply click here to access the full ETF report, ticker code, and step-by-step investment guide. Our expert's #1 ETF report is completely free.

No gimmicks, no payment, no credit card info. Just click the link below and enter your email address. We'll send you the report right away.

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