What does the IAF ETF do for a diversified portfolio?
The iShares IAF ETF provides Australian investors with exposure to a portfolio of Australian investment-grade fixed income securities, which includes treasury bonds, corporate bonds and cash.
Investors could use the IAF ETF to diversify an existing portfolio and gain exposure to Australian bonds, or to create a regular income stream from the quarterly distributions offered by this ETF.
How big is the iShares IAF ETF?
The iShares IAF ETF had $1763.05 million of money invested when we last pulled the monthly numbers. Given IAF’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 Fixed interest – Australia sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
IAF ETF fees reviewed
iShares charges investors a yearly management fee of 0.15% for the IAF ETF. This means that if you invested $2,000 in IAF for a full year, you could expect to pay management fees of around $3.00.
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.
Next steps
Even if you like what you see, before diving straight into buying the IAF ETF, please read the ETF’s Product Disclosure Statement (PDS). Also, be sure to take a look at our iShares IAF report for a more comprehensive overview of this ETF. While you’re on our website, use our complete list of ASX ETFs to search for a few different ETFs in the sector and conduct a side-by-side comparison using everything you’ve learned here.
