The VanEck Vectors MSCI International Sustainable Equity ETF (ASX:ESGI)
The VanEck ESGI ETF provides exposure to sustainable international companies not including Australian or fossil fuel stocks.
According to our most recent data, the ESGI ETF had $125.14 million of money invested. With ESGI’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 International shares 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.
Fees to consider
According to our numbers, the annual management fee on the ESGI ETF is .55%. The issuer, VanEck, collects this fee automatically.
Meaning, if you invested $2,000 in the ESGI ETF for a full year you could expect to pay management fees of around $11.00. 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 ESGI Product Disclosure Statement (PDS), available on the ETF issuer’s website, because it will detail the fees, tax implications and the latest information.
These are high level ideas or basics of the ESGI ETF. To learn more about it, click through to access our free investment review.
The iShares S&P 500 AUD Hedged ETF (ASX:IHVV)
The iShares IHVV ETF provides investors with exposure to the largest 500 US companies. This is a low-cost way to access leading US companies through a single fund.
With our numbers for July 2022, IHVV’s FUM stood at $603.09 million. Since the IHVV’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 Index sector should be able to scale well and become profitable for the ETF issuer.
A look at the IHVV ETF fee load?
iShares, the ETF issuer, charges a yearly management fee of 0.1% for the IHVV ETF. Meaning, if you invest $2,000 for a full year from now you can expect to pay a management fee of around $2.00.
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.
Before you read the Product Disclosure Statement (PDS) or speak to your financial adviser about the IHVV ETF report (both are very important), take a look at our free investment review.
