Would a shrewd ASX investor consider the BetaShares Australia Top 20 Equity Yield Max Fund (Managed Fund) ETF (ASX: YMAX) and ETF Securities Physical Gold ETF (ASX: GOLD) right about now? These two ASX ETFs invest in the Australian shares and Commodities sectors, respectively.
The BetaShares YMAX ETF (ASX:YMAX)
The BetaShares YMAX ETF is an actively managed portfolio of Australia’s top 20 blue-chip companies, designed to maximise income by using covered calls.
According to our most recent data, the YMAX ETF had $247.05 million of money invested. With YMAX’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 Australian shares 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 YMAX ETF is 0.76%. The issuer, BetaShares, collects this fee automatically.
Meaning, if you invested $2,000 in the YMAX ETF for a full year you could expect to pay management fees of around $15.20. 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 0.5%, which is $10.00 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 YMAX Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it will detail the fees, tax implications and the latest information.
These are high level ideas or basics of the YMAX ETF. To learn more about it, click through to access our free investment review.
The ETF Securities GOLD ETF (ASX:GOLD)
The ETFS GOLD ETF provides investors with access to the precious metal of gold, by seeking to achieve a return equivalent to the movements in the gold spot price, before fees and expenses.
With our numbers for Oct 2020, GOLD’s FUM stood at $2186.83 million. Since the GOLD’s FUM is over $100 million, our investing team would say the ETF has met our minimum criteria for the total amount invested, otherwise known as FUM. A very sustainable ETF in the Index sector should be able to scale well and become profitable for the ETF issuer.
Are the fees for the GOLD ETF bad?
ETF Securities, the ETF issuer, charges a yearly management fee of 0.4% for the GOLD ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $8.00.
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.
Before you read the Product Disclosure Statement (PDS) or speak to your financial adviser about the GOLD ETF report (both are very important), take a look at our free investment review.