Find out what the ETF does
The Vanguard VGMF Fund is an actively-managed ETF providing investors with exposure to a portfolio of global companies selected using a rules-based, quantitative approach.
VGMF may be used by investors who want to gain global exposure to equity markets, and by those who believe active management can outperform a broad index and lead to higher long-term returns.
VGMF’s FUM does not meet our minimum hurdle
The Vanguard VGMF ETF had $0 million of money invested when we last pulled the monthly numbers. With a funds under management (FUM) or ‘market cap’ figure of less than $100 million, it’s important to consider if this ETF is still too small.
We say an ETF with more than $100 million invested is typically more sustainable than one with less than $100 million (at least). This is because if an ETF is too small, it may not be sustainable for an ETF issuer/provider, such as Vanguard, to continue to operate it.
That said, there are exceptions to this rule of thumb, especially if the ETF issuer is committed to growing the ETF’s FUM to the point where it becomes profitable.
Pay attention to yearly costs & fees
Vanguard charges investors a yearly management fee of 0.00% for the VGMF ETF. This means that if you invested $2,000 in VGMF for a full year, you could expect to pay management fees of around $0.00.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.5% or around $10.00 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Our takeaway
If you’re thinking about investing in VGMF, bear in mind that this is just an introductory glance at the ETF. To explore further, check out our free Vanguard VGMF report. And for good measure, search our complete list of ASX ETFs for similar ETFs in the International shares sector to do a good comparison.
