Getting exposure to the International shares sector has never been easier thanks to ASX ETFs like the Vanguard FTSE Asia Ex-Japan Shares Index ETF (ASX: VAE). That said, no matter how easy it seems to be, we think it’s still important to do your own ETF review.
How the VAE ETF could be used in portfolios
The Vanguard VAE ETF provides exposure to a portfolio of companies listed in Asia, excluding Japan, Australia and New Zealand. As the ETF is not hedged, investors are also exposed to currency fluctuations.
VAE exceeds our minimum market cap (FUM) criteria
The Vanguard VAE ETF had $280.33 million of money invested when we last pulled the monthly numbers. Given VAE’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 International shares sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
VAE’s fees & costs explained
Vanguard charges investors a yearly management fee of 0.40% for the VAE ETF. This means that if you invested $2,000 in VAE for a full year, you could expect to pay management fees of around $8.00.
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.
Bottom line
This is just a quick overview of the VAE ETF. Before ‘testing the depth of water with both feet’ so to speak, be sure to read the VAE ETF’s Product Disclosure Statement (PDS), available on the Vanguard website, or speak to your financial adviser. For another handy resource, take a look at our Vanguard VAE report. You can also use our complete list of ASX ETFs to search for a few different ETFs in the sector and conduct a side-by-side comparison using everything you’ve learned here.
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