Like us, you might have noticed the Vaneck Australian Equal Weight ETF (ASX: MVW) and think that now could be a good time to consider taking a closer look. Here’s what ETF investors need to know.
1. What does the MVW ETF do for investors?
The VanEck MVW ETF provides exposure to over 60 of the largest and most liquid Australian shares, equally weighted. By equally weighting shares, this ETF aims to reduce concentration risk in specific Australian stocks and sectors.
The VanEck MVW ETF could be used by investors to gain exposure to a broad basket of Australia’s largest public companies, which are likely to grow their profit over time and pay regular, tax-effective dividends to their shareholders. The fund can also include companies which are not from the ASX but generate at least 50% of their revenue in Australia. Please note: MVW’s “equal weight” index will have a different performance and risk profile compared to a traditional sharemarket index, such as the ASX 200, which uses a company’s market capitalisation.
2. Funds under management (FUM)
The Vaneck MVW ETF had $1775.91 million of money invested when we last pulled the monthly numbers. Given MVW’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 Australian shares sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
3. Don’t forget about the fees & costs
Vaneck charges investors a yearly management fee of 0.35% for the MVW ETF. This means that if you invested $2,000 in MVW for a full year, you could expect to pay management fees of around $7.00.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.51% or around $10.20 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Now what?
These are just a few of the considerations or factors you would need to look at when running the rule over the MVW ETF. Before you go any further, take a look at our free Vaneck MVW report. And while you’re at it, don’t forget to search our complete list of ASX ETFs.
So how can you actually invest in the MVW ETF? In the month of March 2022, you can buy the MVW ETF and get free brokerage with Pearler. All you have to do is buy and hold the ETF for 12 months! You can invest as little as $500. To buy MVW for free click here to go to Pearler and sign up (hint: it’s also free to get an account).
