What the Vanguard VAP ETF actually does
The Vanguard VAP ETF provides investors with low-cost exposure to listed Australian property companies and real estate investment trusts (REITs).
The VAP ETF could be used to gain exposure to the Australian property market without the prohibitive costs of actually purchasing property. It could also be used as a tactical position to diversify an existing equity portfolio and generate a regular income stream.
VAP meets our minimum FUM criteria
The Vanguard VAP ETF had $2283.54 million of money invested when we last pulled the monthly numbers. Given VAP’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 Australian shares sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
Don’t forget VAP’s fees
Vanguard charges investors a yearly management fee of 0.23% for the VAP ETF. This means that if you invested $2,000 in VAP for a full year, you could expect to pay management fees of around $4.60.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.51% or around $10.20 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
What to do next
If you’re weighing up investing in the VAP ETF, keep in mind that this is just a brief introduction. Indeed, before doing anything, take a look at our free Vanguard VAP report. And while you’re at it, consider searching our complete list of ASX ETFs for similar ETFs in the Australian shares sector to compare your options.
