It’s time to run a ruler over Vaneck Small Companies Masters ETF (ASX: MVS) and Vanguard Australian Government Bond Index ETF (ASX: VGB). The ETFs invest in the Australian shares and Fixed interest – Australia sectors/industries, respectively.
The Vaneck MVS ETF (ASX:MVS)
The VanEck MVS ETF provides exposure to a diversified portfolio of Australian small caps, with a focus on highly liquid, dividend-paying companies. This ETF tracks the MVIS Australia Small-Cap Dividend Payers Index.
According to our most recent data, the MVS ETF had $68.49 million of money invested. Given its funds under management (also known as FUM or ‘market cap’) is less than $100 million, you should consider if this ETF is still too small and if it is sustainable for the ETF issuer. 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 general rule, especially if the ETF issuer/provider is reputable and committed to growing the ETF’s FUM through effective marketing strategies and distribution to financial advisers.
To learn more about the MVS ETF, read our free ETF investment report once you’re done with this article.
Vanguard VGB ETF (ASX:VGB)
The Vanguard VGB ETF provides investors with exposure to a portfolio of Australian Commonwealth Government bonds, state government bonds and bonds from treasury corporations.
With our numbers for Oct 2020, VGB’s FUM stood at $588.75 million. Since the VGB’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 VGB ETF bad?
Vanguard, the ETF issuer, charges a yearly management fee of 0.2% for the VGB ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $4.00.
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.
Did you know that you get access to our free investment report on Best ETFs Australia? View the free VGB ETF report by clicking here.