If you’re looking for an ASX ETF in the Fixed interest – Australia sector, chances are, the VanEck Vectors Australian Floating Rate ETF (ASX: FLOT) is an ETF you’re considering. Here’s what you need to know.
How ASX investors can use the FLOT ETF
The VanEck FLOT ETF gives investors exposure to a portfolio of Australian dollar-denominated floating rate bonds of investment-grade quality.
FLOT meets our minimum market cap (FUM) criteria
The VanEck FLOT ETF had $282.92 million of money invested when we last pulled the monthly numbers. Given FLOT’s total funds under management (FUM) figure is over $100 million, the ETF has met our minimum criteria for the total amount of money invested, otherwise known as FUM. We draw the line at $100 million for ETFs in the Fixed interest – Australia sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
FLOT ETF fees explained
VanEck charges investors a yearly management fee of 0.22% for the FLOT ETF. This means that if you invested $2,000 in FLOT for a full year, you could expect to pay management fees of around $4.40.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.5% or around $10.00 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Putting it all together
If you’re weighing up investing in FLOT, keep in mind that this is just a brief introduction to the ETF. To supercharge your research, take a look at our free VanEck FLOT report. Then, consider searching our complete list of ASX ETFs for similar ETFs in the Fixed interest – Australia sector to compare your options.