In this short article, we’ll take a look at two top ETFs: VanEck Vectors Australian Property ETF (ASX: MVA) and SPDR S&P/ASX 200 Listed Property Fund ETF (ASX: SLF).
What do the MVA and SLF ETFs do?
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).
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.
If you like the look of the MVA ETF, check out our free MVA ETF report.
One of the easy ways we compare ETFs such as SLF and MVA at Best ETFs and Rask Australia is by analysing the fees and costs of an ETF. Internally, we score ETFs based on management fees, plus indirect costs and we take into account the buy-sell spread. We like to look at the ‘all-in’ costs of buying and owning an ETF.
We’ll keep it easy and just study the fees. Based on our data for December 2021, the MVA ETF has a management expense ratio (MER) of 0.35% while the SLF ETF’s yearly fee was 0.40%.So MVA comes out on top. That said, a more useful metric to know is the fee quartiles that these ETFs find themselves in (note: quartile 1 is best). For example, any ETF which has a fee below 0.3% would be considered in our first (best) quartile.
How do they perform?
Performance matters. Keep in mind, performance isn’t everything — and past performance is not indicative of future performance. It’s just one part of a much bigger picture. The reason we say performance is not everything is because of volatility of financial markets and the economy from one year to the next. Some ETFs and funds can put in a solid return one year just to generate lacking returns the next time around. That’s why we prefer three-year or seven-year track records over one-year track records. It can smooth out the temporary performances caused by external factors. Both ETFs have achieved our three-year performance hurdle. As of December 2021, the MVA ETF had an average annual return of 12.24%. During the same time, the SLF ETF returned 12.34%.
Finally, at Best ETFs Australia, we apply a rating to the ETF issuer or provider. That is, the company that starts and is responsible for operating the ETF on the ASX. There are too many considerations that go into our scoring to detail here. The issuer of MVA is VanEck. VanEck ranks highly for our scores of ETF providers and issuers in Australia. Our team considers VanEck to be one of Australia’s leading providers of specialised ETFs and funds for retail investors and advisers.
Best ETFs Takeaway
Did you know we have free reports? View our ASX MVA review and ASX SLF review today.
For us, the SLF ETF rates positively against our internal scoring methodology, but only just.
We hope this article helped you analyse ETFs. Don’t forget, there’s a lot more to investing well than what we just outlined (risks, diversification, other potentially better ETFs, etc.). Our analyst team at Rask Australia spends months looking at new ASX investments (it’s our day job!). To make your life easier, you can get the name of our team’s top ETF pick for 2022 in a free report. Keep reading to find out how to get our analyst’s report emailed to you right now…
