Would a shrewd ASX investor consider the VanEck Vectors Australian Subordinated Debt ETF (ASX: SUBD) and Antipodes Partners Global Shares (Quoted Managed Fund) ETF (ASX: AGX1) right about now? These two ASX ETFs invest in the Fixed interest – Australia and International shares sectors, respectively.
The VanEck SUBD ETF (ASX:SUBD)
The VanEck SUBD ETF invests in a portfolio of Australian dollar-denominated subordinated bonds from a range of banks and insurance companies.
According to our most recent data, the SUBD ETF had $124.9 million of money invested. With SUBD’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 Fixed interest – Australia 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 SUBD ETF is 0.29%. The issuer, VanEck, collects this fee automatically.
Meaning, if you invested $2,000 in the SUBD ETF for a full year you could expect to pay management fees of around $5.80. 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 SUBD 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 SUBD ETF. To learn more about it, click through to access our free investment review.
The Antipodes Partners AGX1 ETF (ASX:AGX1)
The Antipodes AGX1 is an actively managed portfolio of global equities, which focuses on building a concentrated fund of undervalued companies.
With our numbers for December 2020, AGX1’s FUM stood at $27.58 million. Given it has less than $100 million invested, ask yourself (or your adviser) if the ETF is still too small (and if you should wait to buy into it). If you’re concerned the ETF might not be established enough, compare it alongside one of the other Active ETF (e.g. ETMF) sector ETFs, using our full list of ETFs.
Are the fees for the AGX1 ETF bad?
Antipodes Partners, the ETF issuer, charges a yearly management fee of 1.10% for the AGX1 ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $22.00.
The management fee is above the average for all ETFs on our list of ASX ETFs, but keep in mind the ETF may be able to justify the higher price tag with superior performance over time.
Before you read the Product Disclosure Statement (PDS) or speak to your financial adviser about the AGX1 ETF report (both are very important), take a look at our free investment review.