Getting exposure to the Fixed interest – Australia sector has never been easier thanks to ASX ETFs like the VanEck Vectors Australian Corporate Bond Plus ETF (ASX: PLUS). That said, no matter how easy it seems to be, we think it’s still important to do your own ETF review.
How the PLUS ETF could be used in portfolios
The VanEck PLUS ETF provides investors with exposure to a portfolio of Australian dollar-denominated bonds from investment-grade companies.
PLUS exceeds our minimum market cap (FUM) criteria
The VanEck PLUS ETF had $257.7 million of money invested when we last pulled the monthly numbers. Given PLUS’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.
PLUS’s fees & costs explained
VanEck charges investors a yearly management fee of 0.32% for the PLUS ETF. This means that if you invested $2,000 in PLUS for a full year, you could expect to pay management fees of around $6.40.
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.
This is just a quick overview of the PLUS ETF. Before ‘testing the depth of water with both feet’ so to speak, be sure to read the PLUS ETF’s Product Disclosure Statement (PDS), available on the VanEck website, or speak to your financial adviser. For another handy resource, take a look at our VanEck PLUS report. You can also use our complete list of ASX ETFs to search for a few different ETFs in the sector and conduct a side-by-side comparison using everything you’ve learned here.