How the QOZ ETF fits into an ASX portfolio
The BetaShares QOZ ETF provides exposure to a âfundamentally weightedâ index of 200 large Australian shares. This ETF focuses on weighting the portfolio with a focus on âeconomic importanceâ rather than market capitalisation, while also aiming to outperform traditional market-cap weighted indices.
The QOZ ETF could be used by investors to gain exposure to 200 large Australian companies, without weighting the holdings purely based on the shares market capitalisation. Please note: QOZ’s “fundamentally weighted” index will have a different performance and risk profile compared to a traditional sharemarket index, such as the ASX 200, which uses a company’s market capitalisation.
QOZ meets our minimum level for FUM
The BetaShares QOZ ETF had $406.04 million of money invested when we last pulled the monthly numbers. Given QOZ’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.
What about management fees and costs?
BetaShares charges investors a yearly management fee of 0.40% for the QOZ ETF. This means that if you invested $2,000 in QOZ for a full year, you could expect to pay management fees of around $8.00.
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
Before buying any ETF based on what you read here on Best ETFs, check out our BetaShares QOZ report â it’s completely free! Then, search our complete list of ASX ETFs to do a proper side-by-side comparison of your chosen sector or thematic.
