What do the GEAR and MVB ETFs do?
BetaShares GEAR Fund is an internally geared fund, investing in the largest 200 companies on the ASX, by market capitalisation.
The VanEck MVB ETF provides focused exposure to Australia’s largest industry, the banking sector. This is a low-cost way to invest in the Australian banking industry through a single fund.
If you like the look of the GEAR ETF, check out our free GEAR ETF report.
One of the easy ways we compare ETFs such as MVB and GEAR at Best ETFs and Rask Australia is by analysing the fees and costs of an ETF. Internally, we score ETFs based on management fees, plus indirect costs and we take into account the buy-sell spread. We like to look at the ‘all-in’ costs of buying and owning an ETF.
We’ll keep it basic and just study the fees. Based on our data for December 2021, the GEAR ETF has a management expense ratio (MER) of 0.80% while the MVB ETF’s yearly fee was 0.28%. Therefore, MVB wins on this one. 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.
Three-year return?
Typically, we want to a see ETFs with a three-year track record of positive performance. Put another way, when an ETF achieves a three year track record, we score it fairly better than might otherwise be the case. That said, there are exceptions to this rule of thumb. Also, remember that it’s hard to compare an ETF with a hedge fund strategy against other ETFs. Why? Hedge fund ETFs often use inverse or ‘opposite’ strategies which means that they’re designed to move in an opposite direction to the market. Nevertheless, we can see that both ETFs met their three-year performance milestone.
Finally, at Best ETFs Australia, we apply a rating to the ETF issuer or provider. That is, the company that starts and is responsible for operating the ETF on the ASX. There are too many considerations that go into our scoring to detail here. The issuer of GEAR 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.
Best ETFs Takeaway
Don’t forget our free reviews on ASX GEAR and ASX MVB.
In summary, the GEAR ETF rates more positively for our internal scoring methodology but not by much compared to MVB.
Please, keep in mind, there is much more to zeroing in on a good ETF. That’s why you should now use these skills to find the best ETF you can. If you want the name of our team’s top ETF pick for 2022, keep reading…
