Could Vanguard Australian Shares Index ETF (ASX:VAS) be the best ETF?

Might Vanguard Australian Shares Index ETF (ASX: VAS) be the best exchange-traded fund (ETF) to own in a portfolio?

A lot of investors have certainly put their money into the VAS ETF.

There are quite a few reasons to consider it:

Exposure to ASX 300 shares

The VAS ETF could be one of the best ways to get exposure to the ASX share market.

Investors do get exposure to 300 businesses with this investment, but a lot of the allocation is on a few large businesses like BHP Group Ltd (ASX: BHP), CSL Limited (ASX: CSL), Rio Tinto Limited (ASX: RIO), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB), Australia and New Zealand Banking Group Ltd (ASX: ANZ) and Commonwealth Bank of Australia (ASX: CBA).

There are plenty of other names in the portfolio, though they become tiny parts of the portfolio the further down the ASX 300 list you go.

Low costs

The annual management fee is an important part of the equation for the net returns. Vanguard ETFs are famous for having very low management fees.

The Vanguard Australian Shares Index ETF is no different. It has an annual management fee of 0.10%, which is really good.

Dividend yield

The businesses that dominate the holdings of the ETF are typically known for paying big dividends – the banks, miners and so on.

But COVID-19 has hit those dividends, though I expect they will recover over this reporting season.

An ETF simply passes through the dividends and distributions it receives, so if there are bigger dividends then the ETF can have a bigger yield.

Why I don’t think it’s the best option

The above points are attractive about Vanguard Australian Shares Index ETF.

But, the thing is, I think the total return is the best measure of success. ASX shares aren’t bad, but the blue chips are slow growers (at best).

There are quite a few other ETFs that may be able to produce stronger returns over the long-term such as Betashares Global Quality Leaders ETF (ASX: QLTY) and VanEck Morningstar Wide Moat ETF (ASX: MOAT).

From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

Low fees? Check.

Long-term growth potential? Check.

Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

Simply click here or enter your email address below to access the full ETF report, ticker code, and step-by-step investment guide. Our expert's #1 ETF report is completely free.

No gimmicks, no payment, no credit card info. Just enter your email address below and we'll send you the report right away.

From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

Low fees? Check.

Long-term growth potential? Check.

Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

Simply click here to access the full ETF report, ticker code, and step-by-step investment guide. Our expert's #1 ETF report is completely free.

No gimmicks, no payment, no credit card info. Just click the link below and enter your email address. We'll send you the report right away.

CLICK HERE TO GET THE REPORT

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Keep reading:

General Financial Advice warning
The information on this website is general financial advice only. That means, the advice does not take into account your objectives, financial situation or needs. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. Please read our Terms & Conditions and Financial Services Guide before using this website.

© Rask Australia 2020

Join 20,000+ smart investors

Join the Rask Australia mailing and we’ll send you free investment reports, podcasts, expert insights, investing courses, ASX news and lots, lots more. All free. 

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian-owned.

feedback-icon

What can we do better?

Howdy, ASX investor.

I really care about your experience today.

Please, let me know if you have any suggestions we can use to improve our site and help others invest in ETFs. 

Cheers! 

Owen Rask