The Australian ETF industry seems to be growing faster by the day, and one of the ETFs you might have your eye is the ETF Securities EURO STOXX 50 ETF (ASX: ESTX). In this article, we’ll provide a quick review of the ESTX ETF.
1. Exposure
The ETFS ESTX ETF provides investors with exposure to 50 blue-chip companies from 12 eurozone countries; namely Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain.
2. Funds under management (FUM)
The ETF Securities ESTX ETF had $47.67 million of money invested when we last pulled the monthly numbers. With a funds under management (FUM) or ‘market cap’ figure of less than $100 million, it’s important to consider if this ETF is still too small.
We say an ETF with more than $100 million invested is typically more sustainable than one with less than $100 million (at least). This is because if an ETF is too small, it may not be sustainable for an ETF issuer/provider, such as ETF Securities, to continue to operate it.
That said, there are exceptions to this rule of thumb, especially if the ETF issuer is committed to growing the ETF’s FUM to the point where it becomes profitable.
3. Management fees & costs matter
ETF Securities charges investors a yearly management fee of 0.35% for the ESTX ETF. This means that if you invested $2,000 in ESTX 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 0.5% or around $10.00 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
What now?
These are just some of the considerations or factors you would need to consider when weighing up the ESTX ETF. If you’re looking to do some further digging, be sure to read our ETF Securities ESTX report – it’s free. While you’re at it, don’t forget to search our complete list of ASX ETFs. You can filter the results according to sector, issuer, size, and more.
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