A look at Betashares EX20 and the MVR ETF
The BetaShares EX20 ETF provides exposure to the largest 180 Australian shares, based on market capitalisation, excluding the top 20.
The VanEck MVR ETF provides focused exposure to the Australian resources sector, which is a significant part of the Australian economy. This is a low-cost way to invest in the Australian resources industry through a single fund.
Learn more about the MVR ETF with our full analysis page. Get our MVR review.
So where do we start analysing MVR and EX20? In addition to using our years of experience analysing ETFs to ‘get a feel’ for the ETF, there are simple checks and balances our team uses to compare similar ETFs.
The first is fees. We score ETFs based on their management fees and costs and we take into account the spread. We’ll then compare these ‘all in’ fees and costs across sectors, strategy types and ETF providers.
We’ll keep it easy and just study the fees. Based on our data for December 2020, the EX20 ETF has a management expense ratio (MER) of 0.25% while the MVR ETF’s yearly fee was 0.35%.So EX20 comes out on top. That said, a more useful metric to know is the fee quartiles that these ETFs find themselves in (note: quartile 1 is best). For example, any ETF which has a fee below 0.3% would be considered in our first (best) quartile.
How do they perform?
Performance matters. Keep in mind, performance isn’t everything — and past performance is not indicative of future performance. It’s just one part of a much bigger picture. The reason we say performance is not everything is because of volatility of financial markets and the economy from one year to the next. Some ETFs and funds can put in a solid return one year just to generate lacking returns the next time around. That’s why we prefer three-year or seven-year track records over one-year track records. It can smooth out the temporary performances caused by external factors. Both ETFs have achieved our three-year performance hurdle. As of December 2020, the EX20 ETF had an average annual return of 7.30%. During the same time, the MVR ETF returned 11.09%.
There’s one more important thing to consider: the company that starts and runs the ETF. They are in charge of operating the ETF on the ASX. The provider of the EX20 fund is Betashares. Betashares ranks highly for our scores of ETF providers and issuers in Australia. We believe BetaShares is one of the leading providers of index and non-index style products to retail investors in Australia. Meanwhile, the company responsible for MVR is Vaneck. VanEck ranks highly for our scores of ETF providers and issuers in Australia. Our team considers VanEck to be one of Australia’s leading providers of specialised ETFs and funds for retail investors and advisers.
For us, the MVR ETF rates positively against our internal scoring methodology, but only just.
We hope this article helped you analyse ETFs. Don’t forget, there’s a lot more to investing well than what we just outlined (risks, diversification, other potentially better ETFs, etc.). Our analyst team at Rask Australia spends months looking at new ASX investments (it’s our day job!). To make your life easier, you can get the name of our team’s top ETF pick for 2021 in a free report. Keep reading to find out how to get our analyst’s report emailed to you right now…