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Want to invest ethically for a brighter future? 
(but still make lots of money)?

 Take Rask’s FREE online Ethical Investing course.

What you should know about the Vanguard VIF ETF (ASX:VIF) and the ETPMPD ETF (ASX:ETPMPD)

The Vanguard International Fixed Interest Index (Hedged) ETF (ASX: VIF) and ETF Securities Physical Palladium ETF (ASX: ETPMPD) are Exchange-Traded Funds (ETFs) operating in the Fixed interest – International and Commodities sectors, respectively.

How would an investor add VIF to a portfolio?

The Vanguard VIF ETF provides investors with exposure to high-quality securities issued by governments from around the world. It’s a pretty simple but transparent bond ETF.

According to our most recent data, the VIF ETF had $520.49 million of money invested. With VIF’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 Fixed interest – International 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 VIF ETF is 0.2%. The issuer, Vanguard, collects this fee automatically.

Meaning, if you invested $2,000 in the VIF ETF for a full year you could expect to pay management fees of around $4.00. 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.

How about those fees?

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 VIF Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it will detail the fees, tax implications and the latest information.

The VIF ETF could be one to add to your watchlist. If you want to access our full ETF review, click here to get our full report – it’s totally free.

Getting to know the ETPMPD ETF

The ETFS ETPMPM ETF provides investors with access to the precious metal of palladium, by seeking to achieve a return equivalent to the movements in the palladium spot price, before fees and expenses. Palladium comes from the same family of metals as platinum and is used in many electronic and industrial products, particularly in the automotive industry.

With our numbers for July 2020, ETPMPD’s FUM stood at $6.57 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 Index sector ETFs, using our full list of ETFs.

Fees to watch

ETF Securities, the ETF issuer, charges a yearly management fee of 0.49% for the ETPMPD ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $9.80.

This management fee is below the average for all ETFs on our Best ETFs Australia list of ETFs. However, you might still be able to find a cheaper ETF for less.

Picking over ETFs seems too easy to be true: ‘just pick one and put it in your bottom-drawer’. However, it’s important to get it right the first time so that you won’t end up having to chop-and-change positions (and potentially pay extra tax). To make your life a little easier, if you’re looking at the ETPMPD ETF, make sure you click here to access our analyst’s investment report. It’s free.

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 or enter your email address below 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 enter your email address below and we'll send you the report right away.

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.

CLICK HERE TO GET THE REPORT

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The information on this website is general financial advice only. That means, the advice does not take into account your objectives, financial situation or needs. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. Please read our Terms & Conditions and Financial Services Guide before using this website.

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