1. The Perennial Value/eInvest Future Impact Small Caps Fund (Managed Fund) ETF (ASX:IMPQ) ETF
The eInvest IMPQ Fund provides actively-managed exposure to Australian and New Zealand-listed small caps. IMPQ also focuses on investing in companies with positive environmental, social and governance (ESG) outcomes.
According to our most recent data, the IMPQ ETF had $37.01 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.
Fees to consider
According to our numbers, the annual management fee on the IMPQ ETF is .99%. The issuer, Perennial Value/eInvest, collects this fee automatically.
Meaning, if you invested $2,000 in the IMPQ ETF for a full year you could expect to pay management fees of around $19.80. This fee is different from the fee you pay to your brokerage provider (e.g. CommSec, NabTrade, SelfWealth, etc.), which is the fee to buy or sell the ETF. In addition to a management fee charged by the issuer, be mindful to check the ‘spread‘ for the ETF.
A fee comparison
Fees aren’t the only key consideration for ETF investors, but it’s an easy thing to do. To understand if the ETF you’re looking at is too costly, compare it with other ETFs from the same sector, and against the industry average. For example, the average management fee (MER) across all of the ETFs covered by the Best ETFs Australia team was 0.51%, which is $10.20 per $2,000 invested. Keep in mind that small changes in the fees paid can make a big difference after 10 or 20 years. You should read the IMPQ Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it will detail the fees, tax implications and the latest information.
Want to hear more about the IMPQ ETF? View our free investment review.
2. The BetaShares S&P/ASX 200 Financials Sector ETF (ASX:QFN) ETF
The BetaShares QFN ETF is a more unique ETF that invests in financial companies from within the ASX 200, while excluding A-REITs. This ETF has a substantial exposure to the âBig 4â Australian banks.
With our numbers for July 2022, QFN’s FUM stood at $52.27 million. Given it has less than $100 million invested, ask yourself (or your adviser) if the ETF is still too small (and if you should wait to buy into it). If you’re concerned the ETF might not be established enough, compare it alongside one of the other Index sector ETFs, using our full list of ETFs.
A look at the QFN ETF fee load?
BetaShares, the ETF issuer, charges a yearly management fee of 0.34% for the QFN ETF. Meaning, if you invest $2,000 for a full year from now you can expect to pay a management fee of around $6.80.
This management fee is below the average for all ETFs on our Best ETFs Australia list of ETFs. However, you might still be able to find a cheaper ETF for less.
Want to know more? Get our team’s free QFN ETF review. Simply click here now.
