Don’t you wonder if now is the time to start analysing the ETF Securities Reliance India Nifty 50 ETF (ASX: NDIA) and Vanguard Australian Shares High Yield ETF (ASX: VHY)? These Exchange-Traded Funds (ETFs) aim to provide exposure to the International shares and Australian shares sectors, respectively.
Is the NDIA ETF a good investment? Here’s where you start…
The ETFS NDIA ETF provides investors with exposure to the performance of shares of the largest companies listed on the Indian stock market, based on market capitalisation.
According to our most recent data, the NDIA ETF had $13.47 million of money invested. Given its funds under management (also known as FUM or ‘market cap’) is less than $100 million, you should consider if this ETF is still too small and if it is sustainable for the ETF issuer. At Best ETFs we say an ETF with more than $100 million invested is typically more sustainable than one with less than $100 million (at least). However, there are exceptions to this general rule, especially if the ETF issuer/provider is reputable and committed to growing the ETF’s FUM through effective marketing strategies and distribution to financial advisers.
Get our team’s NDIA ETF review, available free when you click this link: access the free investment report.
A quick take of the 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%.
With our numbers for December 2020, VHY’s FUM stood at $1582.46 million. Since the VHY’s FUM is over $100 million, our investing team would say the ETF has met our minimum criteria for the total amount invested, otherwise known as FUM. A very sustainable ETF in the Index sector should be able to scale well and become profitable for the ETF issuer.
Are the fees for the VHY ETF bad?
Vanguard, the ETF issuer, charges a yearly management fee of 0.25% for the VHY ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $5.00.
The management fee is above the average for all ETFs on our list of ASX ETFs, but keep in mind the ETF may be able to justify the higher price tag with superior performance over time.
Did you know: you can get our full ETF review of VHY by clicking here?
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