Don’t you wonder if now is the time to start analysing the VanEck Vectors Australian Floating Rate ETF (ASX: FLOT) and Vaneck Australian Equal Weight ETF (ASX: MVW)? These Exchange-Traded Funds (ETFs) aim to provide exposure to the Fixed interest – Australia and Australian shares sectors, respectively.
Is the FLOT ETF a good investment? Here’s where you start…
The VanEck FLOT ETF gives investors exposure to a portfolio of Australian dollar-denominated floating rate bonds of investment-grade quality.
According to our most recent data, the FLOT ETF had $261.62 million of money invested. With FLOT’s total funds under management (FUM) figure over $100 million, the ETF meets our team’s minimum investment criteria for FUM levels. As a general rule, our team draws the line at $100 million for ETFs in the Fixed interest – Australia sector because we believe that, relative to smaller ETFs, achieving this amount of FUM lowers the chance that the ETF issuer will close the ETF.
Get our team’s FLOT ETF review, available free when you click this link: access the free investment report.
A quick take of the MVW ETF
The VanEck MVW ETF provides exposure to over 60 of the largest and most liquid Australian shares, equally weighted. By equally weighting shares, this ETF aims to reduce concentration risk in specific Australian stocks and sectors.
With our numbers for July 2021, MVW’s FUM stood at $1612.15 million. Since the MVW’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 Equal weight sector should be able to scale well and become profitable for the ETF issuer.
Are the fees for the MVW ETF bad?
Vaneck, the ETF issuer, charges a yearly management fee of 0.35% for the MVW ETF. Meaning, if you invested $2,000 for a full 12-month period you could expect to pay a base management fee of around $7.00.
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 MVW by clicking here?
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