Australian Shares

Australian Shares

The Best ETFs Australian shares sector includes ETFs, managed funds and index funds which cover the ASX and national stock exchange (NSX). It also includes other sharemarket-focused ETFs and funds which may hold investments overseas (e.g. via the New Zealand or US exchanges).

Performance Characteristics

Over the ultra-long-term, the Australian share market has proven to be among the best-performing in the world. We truly are 'the lucky country'.

One of the unique features of the Australian sharemarket is a willingness by companies to pay substantial dividends back to shareholders. We believe this may be a result of Franking Credits.

Australian Shares Sector Risks

The Australian sharemarket is heavily skewed towards financials (i.e. banks and insurers), resources and property. These companies tend to be ‘cyclical’, meaning they move in-line with the direction of the broader economy and financial markets.

Some risks to investing in this sector include:

  • Market risk: This is the risk that the performance of the ETF/fund rises or falls unexpectedly day-to-day, month-to-month or even year-to-year. We believe these price movements are unpredictable. Therefore, we believe investing for multiple years is the most prudent way to invest.
  • Home country bias: That happens when you invest a larger amount of your money in local/Australian investments and exclude overseas markets. This may be because it is ‘too difficult’ or ‘too complex’ to invest in overseas markets.
  • Concentration: The Australian share market is made up of many companies. However, traditional market indices have a very high proportion of their performance tied to just a few investments, such as blue-chip shares in the financial and resources sectors.
  • Regulatory risk: Australia is a market with a robust financial system. Changes to the rules or laws regarding public investments could alter the performance of ETFs and funds in the sector.

List of Australian Shares ETF

SPDR (ASX:E200) ETF. The SPDR ASX 200 ESG ETF provides investors with exposure to the largest 200 Australian/ASX-listed companies while also being tilted towards companies which exhibit strong Environmental, Social and Governance (ESG) characteristics — and E200 excludes companies in tobacoo and controversial weapons and those which earn more than 5% of their revenue from thermal coal.
VanEck (ASX:DVDY) ETF. The DVDY ETF tracks the Morningstar Australia Dividend Yield Focus Index which aims to capture the highest dividend-paying ASX shares, excluding A-REITs, while also meeting Morningstar’s Economic Moat, Quantitative Economic Moat, and Distance to Default Measures.
Vanguard (ASX:VETH) ETF. The VETH ETF tracks the FTSE Australia 300 Choice Index and attempts to provide low-cost exposure to Australian shares, with an ethical filtering process to exclude shares of companies from particular industries and those which have demonstrated ‘severe controversies’.
InvestSMART (ASX:IIGF) ETF. The IIGF ETF or Intelligent Investor Australian Equity Growth Fund (Managed Fund) by InvestSMART employs an active investment strategy to outperform its Australian share market index, the ASX 200 Accumulation Index.
ETF Securities (ASX:ZYAU) ETF. The ETFS ZYAU ETF aims to track the S&P/ASX 300 Shareholder Yield Index, and invests in 40 stocks from within that index with the highest shareholder yields.
Magellan (ASX:AASF) ETF. The Airlie Australian Share Fund invests in 15-35 companies on the Australian stock exchange using a ‘best ideas’ approach to active investing. The fund aims to have no more than 10% of its portfolio in cash. The AASF fund aims to provide long-term capital growth and regular income to their investors.
Vanguard (ASX:VHY) ETF. The Vanguard VHY ETF provides exposure to the largest dividend-paying Australian shares, based on market capitalisation and forecast dividend yield. It tracks the FTSE Australian High Dividend Yield Index. The index excludes real estate investment trusts (REITs) and caps the total exposure to any sector/industry at 40%.
Vanguard (ASX:VLC) ETF. The Vanguard VLC ETF provides exposure to the MSCI Australian Shares Large Cap Index. This index is a ‘free float-adjusted market capitalization index’ which provides investors with exposure to the largest companies on the ASX.
Vanguard (ASX:VSO) ETF. The Vanguard VSO ETF provides exposure to a diversified portfolio of Australian small caps and tracks the MSCI Australian Shares Small Cap Index. This is a low-cost way to access the performance of Australian small-cap shares through a single fund.
BetaShares (ASX:YMAX) ETF. The BetaShares YMAX ETF is an actively managed portfolio of Australia’s top 20 blue-chip companies, designed to maximise income by using covered calls.
Vanguard (ASX:VAS) ETF. The Vanguard VAS ETF provides exposure to the largest 300 Australian shares, based on market capitalisation. This is a low-cost way to access top Australian companies through a single fund.
Vanguard (ASX:VAP) ETF. The Vanguard VAP ETF provides investors with low-cost exposure to listed Australian property companies and real estate investment trusts (REITs).
BetaShares (ASX:RINC) ETF. The BetaShares Legg Mason RINC ETF is an actively managed fund that invests in companies that own physical assets, like A-REITs, utilities and infrastructure. These companies are expected to grow revenues and profits overtime and provide sustainable dividend income to investors.
ETF Securities (ASX:SELF) ETF. The SelfWealth SELF ETF is an actively managed portfolio of Australian companies, which tracks an index that is made up of top performing SelfWealth member SMSF portfolios.
SPDR (ASX:SFY) ETF. The SPDR SFY ETF is the only Australian ETF providing exposure to Australia’s top 50 listed companies, by market capitalisation. SFY provides a low-cost way to invest in the ASX’s top 50 companies through a single fund.
SPDR (ASX:SLF) ETF. The SLF ETF by SPDR invests in shares/securities of listed real estate investment trusts (REITs). Investors can use these property-focused ETFs to get exposure to a broad basket of trusts and companies exposed to property, including office spaces, commercial rental spaces and construction projects.
Betashares (ASX:SMLL) ETF. The BetaShares SMLL Fund is an ASX-listed managed fund that aims to outperform the S&P/ASX Small Ordinaries Accumulation Index and provide investors with regular capital growth and income.
SPDR (ASX:SSO) ETF. The SPDR SSO ETF provides exposure to a diversified portfolio of Australian companies and tracks the S&P/ASX Small Ordinaries Index. SSO is designed to capture the performance of the top 200 Australian small companies based on market cap, ranking from 101 to 300.
SPDR (ASX:STW) ETF. The SPDR STW ETF is Australia’s first ETF and has been operating for over 15 years. STW provides exposure to the largest 200 Australian shares, based on market capitalisation. This is a low-cost way to access top Australian companies through a single fund.
Switzer (ASX:SWTZ) ETF. The Switzer SWTZ Fund is an actively-managed fund, with the aim to provide investors with capital growth and a tax-effective income stream.
SPDR (ASX:SYI) ETF. The SPDR SYI ETF invests in a diversified portfolio of high-yielding ‘blue chip’ Australian companies – excluding real estate investment trusts (REITs). This ETF tracks the MSCI Australia Select High Dividend Yield Index.
Betashares (ASX:QFN) ETF. The BetaShares QFN ETF is a more unique ETF that invests in financial companies from within the ASX 200, while excluding A-REITs. This ETF has a substantial exposure to the ‘Big 4’ Australian banks.
Betashares (ASX:QOZ) ETF. The BetaShares QOZ ETF provides exposure to a ‘fundamentally weighted’ index of 200 large Australian shares. This ETF focuses on weighting the portfolio with a focus on ‘economic importance’ rather than market capitalisation, while also aiming to outperform traditional market-cap weighted indices.
Betashares (ASX:QRE) ETF. The BetaShares QRE ETF provides a targeted exposure to some of the largest companies in the Australian resources sector and aims to track the Solactive Australia Resources Sector Index.
Russell Investments (ASX:RARI) ETF. The Russell Investments RARI ETF invests in companies that demonstrate positive environmental, social and governance (ESG) characteristics. RARI also negatively screens out companies that have significant involvement in activities that are deemed inconsistent with responsible investment considerations.
Russell Investments (ASX:RDV) ETF. The Russell Investments RDV ETF invests in a diversified portfolio of high-yielding ‘blue chip’ Australian companies. This ETF tracks this Russell Australia High Dividend Index.
SPDR (ASX:OZR) ETF. The SPDR OZR ETF invests in resources companies from within the ASX 200 and aims to track the S&P/ASX 200 Resources Index.
VanEck (ASX:MVA) ETF. The VanEck MVA ETF provides investors with exposure to the Australian property market by investing in a portfolio of ASX-listed property companies and real estate investment trusts (REITs).
Vaneck (ASX:MVB) ETF. 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.
Vaneck (ASX:MVE) ETF. The VanEck MVE ETF provides exposure to a diversified portfolio of large Australian companies and is the only ETF tracking the S&P/ASX Midcap 50 Index in Australia. The MVE ETF is designed to capture the performance of the top 50 Australian midcap companies based on market cap, ranking from 51 to 100.

Something missing?

This brilliant (and free!) report is issued by Best ETFs Australia, a division of The Rask Group Pty Ltd. It is not a recommendation.
Speak to a financial professional before relying on this information and please read our Financial Services Guide (FSG).

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? Please give us us some feedback :)

We care about your experience, please let us know if you have any suggestions to improve our site.