InvestSMART Australian Exchange Traded Fund Report - September 2017

Contents

About this report

Welcome to our inaugural Australian Exchange-Traded Funds quarterly report.

InvestSMART’s mission is to help all Australians grow and protect their wealth, by delivering education resources and a range of portfolio tools and product services.

This report provides investors with an easy-to-digest analysis of the fast-growing Australian ETFs sector. It includes the most popular ASX-listed products by funds under management, the ETFs with the highest and lowest quality ratings based on our Star Ratings process, the best and worst performers, and the prevailing trends dictating retail investment flows.

We have analysed all 157 ETFs on the Australian market, as at September 30, 2017. More investors now hold one or more ETFs in their portfolios, either directly or through managed account products. Indeed, select ETFs form the basis of a range of InvestSMART’s SMA Portfolios.

We have categorised the ETF market by asset class to allow you to quickly identify suitable securities to fill any investment gaps in your portfolio and to remain aligned to your specific investment objectives.

In the three months to the end of September, continued strong inflows into Australian ETFs saw a range of new products launched and total funds under management breach $30 billion for the first time.

The popularity of ETFs is a global trend. More investors are discovering that ETFs are a low-cost, hassle-free way to gain broad exposure to stock markets, specific sectors and asset classes. Rather than buying just a few stocks, one ETF security can cover an entire index, or several markets, at once.

The ability to buy ETFs directly on the market, their low cost and transparency, and achieving quick portfolio diversification through a single transaction, has seen these securities rapidly grow. But it’s important to recognise that not all ETFs are created equal. Put simply, some are better – and safer – than others.

This report will guide you through the ETFs maze. We hope it will help you get to grips with this much misunderstood area of the market and assist you in making better investment decisions.

Ron Hodge

Managing Director

About InvestSMART

Founded in 1999, InvestSMART Group Limited (ASX:INV) believes everyone should have the confidence to control their financial future and it shouldn’t be hard or expensive to do so.

Whether you’re managing your own investments or looking for a little help, we deliver straightforward, flexible and affordable solutions to ensure you are better able to meet your investment goals.

Our three leading brands – InvestSMART, Eureka Report and Intelligent Investor – together offer actionable investment tools, wealth advice and independent ASX-listed stock research.

We’re all about making investing simple. Statistics show four in five Australians do not receive any professional investment advice, with cost the primary reason. We aim to change that.

Through our Portfolio Manager, stock research, wealth commentary and affordable investment products, we believe we are delivering the right tools to help all Australians grow and protect their wealth.

InvestSMART Star Rating

When reviewing an ETF there are some key metrics common to every security. Our quantitative 5 Star Rating System takes each of these items into account, reflecting the process we use to identify investments in InvestSMART’s ETF-based Portfolios.

We have categorised the ETF market by asset class to allow members to quickly identify suitable securities to fill any investment gaps in their portfolio and remain aligned to their specific investment objectives.

For our portfolios, we generally like to see a 4 to 5-star rating. This implies the security rates highly across each of the above-mentioned metrics. However, the star rating is best used as a filtering tool when comparing ETFs with the same objective.

It does not make sense to compare a highly liquid, and hence low-cost S&P 500 ETF, to one designed to track the performance of emerging markets, which are often less liquid and more expensive to access.

As the table below shows, only four Australian ETFs out of the total of 157 listed funds achieve the maximum 5 Star Rating. The bulk of ETFs are rated 3 Stars or less.

It should also be noted that the InvestSMART Star Rating is a quantitative measure and it does not take personal investment objectives into account. It does not constitute a recommendation.

Figure 3: Number of ETFs per star rating

Star Rating	Number of ETFs
5	4
4	23
3	66
2	60
1	2
NA	2

What is an ETF

The first ETF - an open-ended investment fund that is traded on a stock exchange - listed on the Toronto Stock Exchange on March 9, 1990.

The TIPs (Toronto 35 Index Participation Fund) was designed to track the TSX 35 index. The listing was almost three years before the first US ETF listing (the SPDR S&P 500 ETF) and 11 years before the first Australian ETF listing, the SPDR S&P ASX 200 ETF (STW), in August 2001.

Today, the global ETFs sector is estimated at more than $US4 trillion, with more than 2,000 products traded and inflows totalling around $US2 billion per day.

Most ETFs aim to track the performance of an index or an asset class, less fees, offering access to a range of asset classes and investment strategies that ordinary investors were previously unable to reach easily or cheaply. Examples include international equities, fixed income securities and currency markets.

However, there are a growing number of products with an active element to their portfolio construction, generally referred to as “Smart Beta” products.

Figure 4: ETF Creation/Redemption process

Authorised participants provide a market-making function in the ETF market, which ensures liquidity and allows issuers to keep costs low as they don’t need to physically buy/sell the underlying securities.

In buying the underlying securities of the fund and then delivering them to the ETF issuer (BetaShares, State Street, Blackrock, Vanguard, Van Eck etc) authorised participants receive units in the fund which they then place on-market for investors to purchase. The reverse is true in the case of redemptions.

ETF Advantages

Accessibility - You can purchase or redeem units in an ETF at any time during the market hours in the same way as you would for any ordinary share. This means no additional paperwork or unnecessary delays like with unlisted managed funds.

Transparency - Unlike traditional actively managed funds, most ETFs are required to publish a list of their holdings each day.

Cost Effective - Designed to track a specific index or other rule-based methodologies, fees are (on average) lower than a traditional actively managed fund.

Liquidity - Given their open-ended structure, an ETF can be as liquid as its underlying constituents.

Market Overview - FUM

Australia’s ETF sector is growing rapidly. More and more investors now hold at least one ETF in their share portfolio.

This new capital and strong asset gains, particularly from US equity markets, has added more than $6.5 billion to total ETF funds under management (FUM) so far this calendar year.

This includes an additional $2 billion over the three months to September 30, driven by inflows to equity focused ETFs. The total value of the Australian ETF sector is now almost $32 billion, with expectations of it being worth $35 billion by the end of 2017. That’s a 40 percent growth rate over the full 12 months.

New ETF products continue to be launched. At the end of September there were 157 separate ETFs listed on the ASX. During the September quarter there multiple new listings across property and infrastructure, equities, and fixed income & cash.

However, our research indicates investors’ assets are heavily concentrated in a handful of ETFs on the Australian market. The top 10 ETFs ranked by FUM account for almost half ($15.37 billion) of all sector assets, with the two largest funds (STW and VAS) accounting for almost 20 percent.

This reflects the home bias of most investors. The top two funds cover the Australian equities market. The third-largest (IVV) covers the top 500 companies on the US market.

These three largest funds account for more than $8 billion in investor’ funds – about a quarter of the total Australian ETFs market (see the top 10 Australian ETFs table below).

Figure 7: Top 10 ETFs by FUM

Code	Name	FUM ($m)	Star Rating	September Quarter Inflows ($m)
STW	SPDR S&P/ASX 200 ETF	3,300.2	5	–150.25
VAS	Vanguard Australian Shares ETF	2,429.8	5	480.66
IVV	iShares S&P 500 ETF	2,309.7	5	72.16
AAA	BetaShares Aus High Interest Cash ETF	1,263.54	5	17.45
IOO	iShares Global 100 ETF	1,242.29	3	52.27
VTS	Vanguard US Total Market Shares ETF	1,064.75	5	45.21
VEU	Vanguard All World ex-US Shares ETF	985.66	4	92.00
VAP	Vanguard Australian Property Secs ETF	961.68	3	59.60
VHY	Vanguard Australian Shares High Yield ETF	938.35	4	85.83
IOZ	iShares Core S&P/ASX 200 ETF	723.16	4	46.45

Source: ASX and Morningstar

Below the 10 largest ETFs, the level of FUM falls significantly. InvestSMART’s sector analysis shows that half of the ETFs on the ASX have less than $50 million in FUM, and 51 of those have less than $20 million, including 29 that have less than $10 million. Many of the smaller funds are relatively new, and in all likelihood will grow over time.

Figure 8: Australian ETF market breakdown

Market Overview - Flows 

By analysing FUM flow, we can see the ‘net demand’ for ETF products. Given the majority of ETFs are index tracking - designed to replicate the performance of a given market index - analysing flows over time offers an insight into trends in market sentiment toward a particular asset class.

Figure 9: FUM Flows

Overview

In the September quarter, equities continued to enjoy most of the inflows, followed by fixed income & cash. We’ve seen this trend month after month since the beginning of the calendar year, with equities dominating in each month except for January.

The ETF with the largest net inflows for the quarter was Vanguard’s Australian Shares ETF (VAS).

The ETF seeing the largest net outflows was SPDRs ASX 200 ETF (STW).

Figure 10: FUM Flows ($m) by Asset Class

Market Overview - Costs

Traditionally, active fund managers have charged a management fee as a percentage of FUM, plus a performance fee based on outperformance compared with a benchmark. As most ETFs are passive (index tracking), management fees are generally lower and there are no performance fees.

It’s also important to factor in the spread when reviewing an ETF. The spread is the difference between the bid and offer price of an ETF,  generally a function of the liquidity in the underlying holdings. The management expense ratio (MER), meanwhile, is an indication of all fees and charges, expressed as a percentage of funds under management.

Figure 13: Cost Analysis

Overview

Fixed income & cash remains the cheapest asset class, even after incorporating spreads. Geographically, ETFs focused on Australia and the US are, on average, the cheapest.

Broad-based equity market and cash-focussed ETFs are the cheapest, a function of the underlying liquidity in these markets.

Actively managed and more complex ETFs tend to be more expensive, a result of generally higher management fees and larger spreads, designed to incorporate the costs of dealing in the fund’s underlying securities.

Market Overview - Performance

An ETF should closely track its underlying index. Unlike active fund managers, negative returns do not necessarily mean the fund manager is doing poorly. Instead, it’s a reflection of the performance of the underlying securities the ETF has been designed to track, minus the fee.

Overview

Following weaker performance in previous periods, resource-focused ETFs made up 4 of the top 5 best performing ETFs for the quarter. Geographically, ETFs exposed to emerging markets provided the largest returns over the three months.

Figure 18: Top 5 returning ETFs

Market Overview - Yield

Yield is the income earned on an investment, expressed as a percentage. Historically, Fixed income, Property & Infrastructure securities have generated most of an investor’s return from distributions of income.

With equities, it’s a bit different as a company can distribute profits or retain them to grow, or a combination of the two. Investments in physical Commodities and Currency meanwhile, offer little or nothing in terms of yield as they’re non-income producing assets.

Overview

Equities, Fixed Income & Cash and Property & Infrastructure provided the greatest Income based returns for the 12 months to September.

Geographically, Australia enjoyed the highest returns from income, a function of our high interest rates and equity pay-out ratios compared to the rest of the world.

There is also an increasing number of “high income, low volatility” ETFs coming to market as investors grow wary of global volatility.

The highest yielding security for the year to September was iShares Global 100 AUD Hedged ETF (IHOO). The fund aims to provide investors with the performance of an index composed of 100 large capitalisation global equities (hedged to Australian dollars).

Figure 20: Top 5 Yielding ETFs

Securities Overview - Commodities

Commodities securities are designed to provide exposure to the performance of various commodities and natural resources. The majority are physically backed, although synthetic security listings are rising.

We do not hold any Commodity focused ETFs in our SMA Portfolios.

Overview

Close to 100% of net inflows for the quarter were directed to ETF Securities Gold ETF (GOLD).

ETFS Physical Palladium (ETPMPD) was the strongest performer (albeit off a very low level of FUM), while the ETFS Physical Silver (ETPMAG) and ETFS Physical Platinum ETFs (ETPMAG) were the worst performing securities within the category.

Figure 22: Commodity ETFs by Geography

Figure 23: Commodity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
GLOBAL
Agriculture
BetaShares Agriculture ETF CcyHgd(Synth)	QAG	2.66	0.00	0.69%	0.93%	-7.38%	-11.18%	0.00%	11.13%	1,435	2
Diversified Commodities
ETFS Physical PM Basket ETC	ETPMPM	4.86	0.00	0.44%	0.51%	1.70%	-4.30%	0.00%	1.55%	21	2
BetaShares Com Basket ETF Ccy Hgd(Synth)	QCB	9.45	0.00	0.69%	1.04%	1.83%	1.91%	0.00%	5.95%	2,029	2
Gold.
ETFS Physical Gold ETC	GOLD	542.10	19.96	0.40%	0.09%	0.87%	-5.76%	0.00%	6.93%	7,859	4
BetaShares Gold Bullion ETF Ccy Hedged	QAU	60.73	0.00	0.59%	0.23%	3.03%	-3.88%	0.00%	6.35%	9,658	2
ETFS Physical Singapore Gold ETF	ZGOL	13.02	0.00	0.40%	0.35%	1.09%	-5.86%	0.00%	4.16%	1,120	2
Oil
BetaShares Crude Oil ETF Ccy Hgd(Synth)	OOO	41.79	-1.82	0.69%	0.16%	10.19%	-5.02%	0.00%	12.54%	12,415	2
Palladium
ETFS Physical Palladium ETC	ETPMPD	1.89	0.00	0.49%	1.41%	8.55%	25.68%	0.00%	2.29%	13	1
Platinum
ETFS Physical Platinum ETC	ETPMPT	2.94	0.00	0.49%	0.45%	-2.58%	-13.65%	0.00%	2.59%	22	2
Silver
ETFS Physical Silver ETC	ETPMAG	56.14	0.20	0.49%	0.53%	-0.05%	-15.44%	0.00%	3.62%	3,292	2

Source: ASX and Morningstar

Securities Overview - Currency

These securities are designed to track the performance of the Australian dollar relative to various currencies.

We do not hold any Currency focussed ETFs in our SMA Portfolios.

Overview

The majority on inflows were directed to the BetaShares Strong USD ETF (YANK). The stronger $A relative to the $US saw Betashares Strong Australian Dollar ETF (AUDS) perform well.

AUDS provides investors with a way to obtain magnified “long” exposure to the value of Australian dollar relative to the US dollar.

Figure 25: Currency ETFs by Geography

Figure 26: Currency EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
ASIA
ETFS Physical Renminbi ETF	ZCNH	0.45	0.00	0.30%	0.26%	-0.36%	-2.38%	0.00%	1.50%	25	2
EUROPE
BetaShares Euro ETF	EEU	5.69	1.10	0.45%	0.12%	1.20%	2.11%	0.00%	22.10%	2,448	3
BetaShares British Pound ETF	POU	55.30	0.00	0.45%	0.09%	0.88%	0.36%	0.00%	12.22%	13,342	3
AUSTRALIA
BetaShares Strong Australian Dollar Hdg	AUDS	1.65	0.03	1.38%	0.20%	4.30%	0.00%	1.90%	49.70%	1,827	2
USA
BetaShares US Dollar ETF	USD	503.73	4.85	0.45%	0.09%	-2.21%	-2.57%	0.17%	17.32%	228,031	5
BetaShares Strong US Dollar Hedge	YANK	13.01	7.65	1.38%	0.17%	-6.35%	0.00%	0.00%	50.03%	13,503	2
ETFS Physical US Dollar ETF	ZUSD	11.99	0.77	0.30%	0.16%	-2.11%	-2.36%	0.00%	6.66%	2,631	3

Source: ASX and Morningstar

Securities Overview - Property & Infrastructure

These securities are designed to track various Domestic and Global Property & Infrastructure indexes.

We hold positions in VAP, IFRA & DJRE in our SMA Portfolios.

Overview

VanEck’s Vectors Australian Property ETF (MVA) was the best performing for the quarter, while the Dow Jones Global Real Estate ETF (DJRE) was the worst. Despite negative returns, VAP saw the largest inflows during the quarter.

Figure 28: Property & Infrastructure ETFs by Geography

Figure 29: Property & Infrastructure EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
AUSTRALIA
Property
VanEck Vectors Australian Property ETF	MVA	69.93	9.64	0.35%	0.17%	2.68%	0.24%	5.55%	7.56%	8,406	3
SPDR? S&P/ASX 200 Listed Property ETF	SLF	565.80	3.66	0.40%	0.18%	1.61%	-2.86%	4.34%	3.25%	49,722	3
Vanguard Australian Property Secs ETF	VAP	961.68	59.60	0.23%	0.10%	1.98%	-1.81%	4.06%	7.88%	32,275	3
GLOBAL
Infrastructure
AMP Capital Global Infras Secs Unhdg	GLIN	24.52	1.98	0.85%	0.72%	1.84%	7.15%	2.13%	19.37%	59,068	2
VanEck Vectors FTSE Glbl Infras(Hdg)ETF	IFRA	49.39	11.85	0.52%	0.27%	1.11%	11.03%	2.55%	14.01%	10,316	2
ETFS Global Core Infrastructure ETF	CORE	0.77	0.77	0.45%		0.00%	0.00%	0.00%	29.99%		0
Property
SPDR? Dow Jones Global Real Estate ETF	DJRE	162.73	21.97	0.50%	0.15%	-1.60%	-3.61%	3.56%	6.99%	18,368	3
AMP Capital Global Property Secs Unhdg	RENT	17.04	3.11	0.99%	0.87%	-0.73%	-2.31%	1.55%	25.49%	63,092	2

Source: ASX and Morningstar

Securities Overview - Fixed Income & Cash

These securities are designed to provide investors access to domestic and global Fixed Income & Cash securities.

We hold positions in AAA, FLOT & IAF in our SMA Portfolios.

Overview

The iShares JP Morgan USD Emerging Markets Bond (AUD Hedged) ETF was the best performing Fixed Income & Cash ETF for the quarter while iShares Government Inflation ETF (ILB) was the worst.

iShares’ new Core Cash ETF (BILL), a lower-cost alternative to the longer standing BetaShares High Interest Cash ETF (AAA), enjoyed the largest inflows for the quarter.

Figure 31: Fixed Income ETFs by Geography

Figure 32: Fixed Income & CASH EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
GLOBAL
Corporate
iShares Core Global Corp Bd AUDH ETF	IHCB	79.12	10.68	0.26%	0.26%	1.06%	2.01%	2.90%	8.39%	1,999	3
iShares Global High Yield Bond AUDH ETF	IHHY	26.17	7.63	0.56%	0.34%	1.77%	8.42%	4.70%	17.03%	1,231	2
Diversified
iShares JP Morgan USD EmMkts Bd AUDH ETF	IHEB	10.89	3.25	0.51%	0.38%	2.73%	4.42%	4.40%	19.66%	596	2
Vanguard Intl Credit Secs Idx (Hdg) ETF	VCF	125.34	25.81	0.30%	0.16%	1.11%	1.81%	9.39%	9.33%	7,345	3
Government
Vanguard Intl Fxd Intr Idx (Hdg) ETF	VIF	152.14	50.30	0.20%	0.09%	0.62%	-0.79%	9.53%	14.56%	13,594	4
AUSTRALIA
Cash
BetaShares Aus High Interest Cash ETF	AAA	1,263.54	17.45	0.18%	0.02%	0.50%	2.03%	2.00%	21.86%	178,369	5
iShares Core Cash ETF	BILL	155.83	145.70	0.07%	0.01%	0.44%	0.00%	0.32%	39.15%	17,911	4
iShares Enhanced Cash ETF	ISEC	15.05	10.02	0.12%	0.01%	0.54%	0.00%	0.40%	38.25%	1,698	4
UBS IQ Cash ETF	MONY	1.00	0.00	0.18%	0.05%	0.41%	0.00%	0.56%	0.67%	11	3
Corporate
VanEck Vectors Australian Corp Bd ETF	PLUS	80.62	43.99	0.32%	0.26%	0.79%	0.00%	0.94%	25.31%	31,770	3
Russell Inv Australian Select CorpBd ETF	RCB	147.66	15.23	0.28%	0.25%	1.52%	2.99%	4.23%	6.87%	16,560	3
Vanguard Australian Corp Fxd Intr ETF	VACF	62.08	25.01	0.26%	0.19%	0.71%	2.01%	2.96%	17.88%	6,301	3
VanEck Vectors Australian Fltng Rt ETF	FLOT	21.19	21.15	0.22%	0.06%	0.00%	0.00%	0.67%	46.19%	8,086	3
Betashares Aus Bank Sr Fltng Rt Bd ETF	QPON	110.59	94.14	0.22%	0.04%	0.98%	0.00%	0.76%	46.82%	42,881	4
Diversified
iShares Core Composite Bond ETF	IAF	453.07	36.65	0.20%	0.06%	-0.12%	-0.93%	2.21%	8.10%	11,349	4
Vanguard Australian Fixed Interest ETF	VAF	676.10	36.79	0.20%	0.06%	-0.11%	-0.89%	2.81%	7.14%	32,562	4
Government
SPDR? S&P/ASX Australian Bond ETF	BOND	28.29	0.03	0.24%	0.15%	-0.61%	-1.27%	3.15%	5.64%	2,087	3
SPDR? S&P/ASX Australian Govt Bd ETF	GOVT	15.33	0.01	0.22%	0.11%	-0.82%	-1.94%	2.53%	7.41%	1,486	3
iShares Treasury ETF	IGB	29.34	0.01	0.26%	0.18%	-0.49%	-2.85%	2.70%	8.54%	816	3
iShares Government Inflation ETF	ILB	94.90	6.86	0.26%	0.35%	-0.85%	-1.73%	0.90%	8.45%	2,320	3
Russell Inv Australian Government Bd ETF	RGB	59.47	0.02	0.24%	0.30%	-0.08%	-2.36%	3.25%	1.25%	1,191	3
Russell Inv Australian Semi-Govt Bd ETF	RSM	60.58	0.04	0.26%	0.28%	0.66%	0.58%	2.33%	3.34%	3,316	3
Vanguard Australian Government Bond ETF	VGB	135.85	4.98	0.20%	0.09%	-0.33%	-1.67%	2.58%	8.74%	8,004	4

Source: ASX and Morningstar

Securities Overview - Equities

Offering broad-based and specific sector exposure to domestic and international equity markets, there are an increasing number of ETFs designed to achieve specific rules-based objectives. Examples include high yield, ethical, value and momentum.

We hold positions in IAA, IVV, VEQ, VE, UMAX & IOZ our SMA Portfolios.

Overview

ETFs focused on emerging markets were the best performing category for the quarter.

The Vanguard Australian Shares ETF (VAS) saw the largest inflows for the quarter, while the SPDR S&P/ASX 200 ETF (STW) saw the largest outflows. These are the largest ETFs on the Australian market, holding more than $6.7 billion in FUM.

Figure 34: Equity ETFs by Geography

Figure 35: Australian Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
AUSTRALIA
Equities - Broad
BetaShares Aus Ex-20 Port Divrs ETF	EX20	12.84	1.61	0.25%	0.12%	1.08%	0.00%	1.70%	13.31%	3,253	3
iShares S&P/ASX 20 ETF	ILC	318.73	5.33	0.24%	0.07%	0.31%	8.87%	4.88%	4.99%	22,762	4
iShares Core S&P/ASX 200 ETF	IOZ	723.16	46.45	0.15%	0.07%	0.64%	9.08%	3.93%	8.59%	84,956	4
iShares S&P/ASX Small Ordinaries ETF	ISO	64.54	1.36	0.55%	0.33%	4.22%	2.56%	2.39%	5.46%	26,522	3
VanEck Vectors S&P/ASX MidCap ETF	MVE	48.36	15.00	0.45%	0.17%	-0.79%	9.18%	2.24%	13.72%	8,001	2
VanEck Vectors Small Coms Masters ETF	MVS	60.95	4.32	0.49%	0.18%	0.83%	2.38%	3.27%	6.26%	6,902	3
VanEck Vectors Australian Equal Wt ETF	MVW	316.65	52.01	0.35%	0.09%	0.43%	8.97%	2.75%	11.30%	42,888	4
BetaShares FTSE RAFI Australia 200 ETF	QOZ	270.03	25.40	0.40%	0.11%	1.81%	12.36%	3.31%	10.50%	71,762	4
SPDR? S&P/ASX 50 ETF	SFY	443.34	16.81	0.29%	0.06%	0.50%	9.40%	4.90%	4.61%	12,805	4
SPDR? S&P/ASX Small Ordinaries ETF	SSO	14.60	2.62	0.50%	0.20%	4.26%	3.08%	2.63%	6.64%	2,298	2
SPDR? S&P/ASX 200 ETF	STW	3,300.20	-150.25	0.19%	0.04%	0.63%	9.06%	4.42%	9.01%	188,674	5
Vanguard Australian Shares ETF	VAS	2,429.80	480.66	0.14%	0.05%	0.81%	8.91%	4.13%	10.30%	104,961	5
Vanguard MSCI Australian Large Coms ETF	VLC	73.71	2.42	0.20%	0.05%	0.51%	8.13%	4.51%	5.88%	2,365	3
Vanguard MSCI Australian Small Coms ETF	VSO	105.52	11.17	0.30%	0.12%	2.08%	5.06%	4.32%	8.61%	5,957	3
ETFS S&P/ASX 100 ETF	ZOZI	10.19	-21.52	0.24%	0.20%	0.37%	9.39%	4.67%	101.01%	31,183	2
Equities - Sector
VanEck Vectors Australian Banks ETF	MVB	27.26	0.06	0.28%	0.09%	2.35%	15.00%	5.39%	15.40%	5,133	3
VanEck Vectors Australian Resources ETF	MVR	28.47	0.01	0.35%	0.11%	9.89%	21.67%	1.90%	5.92%	2,596	3
SPDR? S&P/ASX 200 Fincls EX A-REIT ETF	OZF	62.49	-56.88	0.40%	0.11%	0.05%	13.69%	4.95%	42.84%	7,557	3
SPDR? S&P/ASX 200 Resources ETF	OZR	39.91	6.20	0.40%	0.17%	9.16%	17.95%	1.86%	9.29%	13,197	2
BetaShares S&P/ASX200 Fincls Sect ETF	QFN	17.82	-9.31	0.39%	0.13%	0.04%	13.59%	5.20%	36.19%	18,866	3
BetaShares S&P/ASX200 Res Sect ETF	QRE	17.74	0.01	0.39%	0.28%	9.16%	17.88%	1.52%	8.26%	10,201	2
Equities - Strategy
iShares Edge MSCI Australia Multifactor	AUMF	6.45	0.00	0.30%	0.21%	2.12%	0.00%	1.96%	6.72%	536	3
BetaShares Managed Risk Australian Share	AUST	30.94	0.01	0.49%	0.11%	0.21%	5.07%	3.34%	7.13%	4,758	3
BetaShares Australian Eqs Strong BearHdg	BBOZ	96.68	-7.07	1.38%	0.11%	-1.33%	-17.65%	0.00%	64.56%	117,071	3
BetaShares Aus Equities Bear Hedge	BEAR	55.39	-7.49	1.38%	0.11%	-0.49%	-7.28%	0.00%	14.98%	18,861	3
UBS IQ Morningstar Australia Div Yld ETF	DIV	27.90	1.16	0.30%	0.25%	-1.23%	6.93%	4.70%	3.02%	1,379	2
UBS IQ Morningstar Australia Quality ETF	ETF	27.15	0.15	0.30%	0.19%	-1.87%	1.50%	1.64%	3.51%	1,583	3
VanEck Vectors S&P/ASX Franked Div ETF	FDIV	3.73	0.00	0.35%	0.20%	-0.15%	-0.18%	4.34%	9.73%	519	2
BetaShares Geared Australian Equity(Hdg)	GEAR	64.63	2.50	0.80%	0.11%	0.35%	16.27%	6.53%	65.81%	66,811	3
iShares S&P/ASX Dividend Opps ETF	IHD	251.93	8.42	0.30%	0.13%	-0.70%	8.21%	5.56%	4.26%	25,815	4
iShares Edge MSCI Australia Minimum Vol	MVOL	6.29	0.00	0.30%	0.20%	-0.96%	0.00%	2.21%	1.44%	114	3
Russell Inv Australian Rspnb Inv ETF	RARI	66.36	1.36	0.45%	0.25%	0.52%	8.96%	5.23%	3.65%	3,339	3
Russell Inv High Dividend Aus Shrs ETF	RDV	274.52	5.26	0.34%	0.08%	3.05%	12.56%	5.82%	4.30%	13,217	4
Russell Inv Australian Value ETF	RVL	13.37	0.01	0.34%	0.08%	0.24%	10.81%	4.43%	4.56%	681	3
BetaShares Australian Small Coms Sel	SMLL	11.18	1.87	0.39%	0.58%	1.61%	0.00%	0.00%	7.11%	8,089	2
SPDR? MSCI Australia Sel Hi Div Yld ETF	SYI	186.25	8.79	0.35%	0.07%	0.01%	10.92%	5.02%	4.63%	9,841	3
UBS IQ MSCI Australia Ethical ETF	UBA	170.60	9.82	0.17%	0.14%	0.80%	10.26%	4.08%	2.31%	6,803	3
Vanguard Australian Shares High Yld ETF	VHY	938.35	100.55	0.25%	0.06%	1.17%	12.75%	7.60%	7.22%	35,642	4
BetaShares Aus Top 20 Eq Yld Maxmsr	YMAX	406.15	16.49	0.79%	0.16%	0.73%	7.05%	8.81%	6.53%	96,797	4
ETFS S&P/ASX 300 High Yield Plus ETF	ZYAU	28.81	8.89	0.35%	0.20%	3.13%	15.27%	9.42%	14.51%	11,284	2
BetaShares Australian Div Harvester(mgd)	HVST	346.67	-60.38	0.90%	0.09%	-5.85%	-6.08%	11.58%	11.37%	81,430	4

Source: ASX and Morningstar

Figure 36: Global Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
GLOBAL
Equities - Broad
iShares Global 100 AUD Hedged ETF	IHOO	29.48	2.55	0.43%	0.50%	4.57%	21.28%	11.96%	9.20%	824	2
iShares Core MSCI World All Cap AUD Hdg	IHWL	7.44	2.43	0.19%	0.62%	4.33%	19.83%	1.14%	30.60%	2,284	2
iShares Global 100 ETF (AU)	IOO	1,242.29	52.27	0.40%	0.20%	2.63%	17.58%	2.13%	3.55%	12,967	3
iShares MSCI EAFE ETF (AU)	IVE	291.34	20.95	0.33%	0.30%	2.98%	16.00%	2.13%	3.99%	4,347	3
iShares Core MSCI World All Cap	IWLD	14.23	4.63	0.16%	0.60%	2.66%	15.49%	1.51%	14.01%	1,999	2
VanEck Vectors MSCI Wld ex Aus Qlty ETF	QUAL	265.37	38.96	0.40%	0.18%	2.14%	13.79%	3.14%	9.01%	37,657	3
UBS IQ MSCI World ex Australia Ethcl ETF	UBW	22.71	2.77	0.35%	0.24%	2.57%	15.22%	1.89%	6.73%	2,270	2
Vanguard All-World ex-US Shares ETF	VEU	985.66	92.20	0.11%	0.13%	-1.92%	12.55%	2.26%	5.03%	24,095	4
Vanguard MSCI Index Intl (Hdg) ETF	VGAD	308.53	61.64	0.21%	0.06%	4.25%	19.57%	4.13%	12.27%	19,265	3
Vanguard MSCI Index Intl ETF	VGS	681.75	137.27	0.18%	0.07%	2.53%	15.44%	2.96%	13.64%	46,499	4
SPDR? S&P World ex Australia(Hedged) ETF	WXHG	71.55	-10.15	0.35%	0.22%	4.22%	19.85%	3.01%	14.70%	15,784	2
SPDR? S&P World ex Australia ETF	WXOZ	152.44	-3.55	0.30%	0.19%	2.44%	15.45%	2.32%	2.05%	3,805	3
Equities - Sector
BetaShares Glb Banks ETF-Ccy Hdg	BNKS	55.64	13.79	0.57%	0.26%	5.01%	38.15%	1.50%	17.85%	43,915	2
BetaShares Glb Healthcare ETF-Ccy Hdg	DRUG	21.92	3.29	0.57%	0.31%	3.13%	13.71%	0.00%	11.50%	14,154	2
BetaShares Global Sstnbty Ldrs ETF	ETHI	91.73	29.47	0.59%	0.23%	2.96%	0.00%	1.21%	18.41%	77,847	3
BetaShares Glb Agltr Coms ETF-Ccy Hdg	FOOD	12.82	3.43	0.57%	0.32%	5.86%	17.98%	0.95%	9.86%	6,759	2
BetaShares Glb Energy Coms ETF-Ccy Hdg	FUEL	6.79	1.13	0.57%	0.30%	8.83%	6.90%	4.07%	16.25%	6,073	2
Market Vectors Gold Miners ETF	GDX	61.66	2.18	0.53%	0.35%	1.87%	-14.88%	0.21%	7.60%	5,255	2
Betashares Global Cybersecurity ETF	HACK	44.47	19.12	0.67%	0.27%	-0.74%	7.80%	2.65%	39.53%	88,621	3
iShares Global Consumer Staples ETF (AU)	IXI	129.63	-13.83	0.47%	0.32%	-2.52%	2.16%	1.89%	4.59%	1,559	3
iShares Global Healthcare ETF (AU)	IXJ	479.18	14.30	0.47%	0.26%	0.61%	10.43%	1.34%	3.08%	3,433	3
iShares Global Telecom ETF (AU)	IXP	20.05	-0.38	0.47%	0.51%	1.09%	-0.95%	3.38%	4.75%	421	2
BetaShares Glb Gold Miners ETF-Ccy Hdg	MNRS	5.32	0.00	0.57%	0.50%	0.24%	-17.61%	0.44%	22.38%	10,533	1
ETFS ROBO Glbl Robotics and Atmtn ETF	ROBO	4.15	4.15	0.69%		0.00%	0.00%	0.00%	85.59%		0
Equities - Strategy
AMP Capital Dynamic Markets ETF (Hedge)	DMKT	19.58	2.06	0.50%	0.71%	2.45%	8.22%	4.77%	5.87%	14,467	2
Schroder Real Return ETF	GROW	41.90	6.27	0.90%	0.47%	0.51%	4.24%	1.41%	6.75%	25,041	3
Market Vectors Morningstar Wide Moat ETF	MOAT	48.06	4.78	0.49%	0.26%	-0.27%	16.93%	0.90%	9.45%	2,856	2
SPDR? MSCI World Quality Mix	QMIX	6.81	0.88	0.40%	0.27%	2.44%	11.52%	2.47%	4.63%	602	2
ETFS Morningstar Global Technology ETF	TECH	14.51	6.55	0.45%	0.23%	5.73%	0.00%	0.78%	19.61%	1,415	3
SPDR? S&P Global Dividend ETF	WDIV	142.24	22.70	0.50%	0.23%	0.89%	7.98%	3.97%	7.32%	18,306	3
iShares Edge MSCI World Multifactor	WDMF	17.23	4.62	0.35%	0.46%	4.52%	0.00%	3.95%	31.51%	5,236	2
BetaShares Managed Risk Global Share	WRLD	41.92	2.14	0.54%	0.21%	1.92%	13.23%	0.89%	11.22%	14,165	2
iShares Edge MSCI World Minimum Volatil	WVOL	11.72	0.00	0.30%	0.49%	1.14%	0.00%	1.51%	12.78%	1,893	3

Source: ASX and Morningstar

Figure 37: USA Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
USA
Equities - Broad
iShares S&P Mid-Cap ETF	IJH	118.71	-1.15	0.07%	0.27%	-5.29%	6.36%	1.23%	15.00%	2,663	3
iShares S&P Small-Cap ETF	IJR	93.84	7.16	0.07%	0.71%	-4.94%	7.07%	1.09%	6.07%	1,946	3
iShares Russell 2000 ETF (AU)	IRU	66.01	3.06	0.20%	0.33%	-3.44%	8.86%	1.10%	4.62%	532	2
iShares S&P 500 ETF	IVV	2,309.70	72.16	0.04%	0.04%	-3.35%	10.03%	1.61%	5.31%	12,622	4
BetaShares NASDAQ 100 ETF	NDQ	187.82	38.85	0.48%	0.11%	3.61%	20.16%	0.49%	16.51%	75,013	4
BetaShares FTSE RAFI US 1000 ETF	QUS	30.68	0.03	0.40%	0.18%	1.87%	13.33%	2.23%	11.73%	3,930	3
SPDR? S&P 500 ETF	SPY	20.12	-1.25	0.09%	0.07%	-3.37%	9.92%	1.77%	8.57%	188	3
Vanguard US Total Market Shares ETF	VTS	1,064.75	45.21	0.04%	0.08%	-3.36%	9.73%	1.60%	4.21%	8,991	4
Equities - Strategy
BetaShares Geared US Eq- Ccy Hdg	GGUS	9.64	0.00	0.80%	0.13%	8.47%	37.39%	0.72%	26.58%	6,231	2
iShares S&P 500 AUD Hedged ETF	IHVV	86.98	-2.85	0.10%	0.12%	4.43%	19.00%	1.87%	18.31%	1,605	3
UBS IQ MSCI USA Ethical ETF	UBU	5.89	0.01	0.20%	0.29%	2.02%	14.58%	2.08%	9.80%	824	2
BetaShares S&P 500 Yield Maximiser	UMAX	91.27	3.53	0.79%	0.17%	1.30%	11.60%	4.64%	7.11%	12,170	3
ETFS S&P 500 High Yield Low Volatil ETF	ZYUS	52.15	6.00	0.35%	0.19%	-0.52%	5.16%	6.37%	9.23%	12,701	3
BetaShares US Eqs Strong Bear H-Ccy Hdg	BBUS	72.34	19.26	1.38%	0.18%	-9.62%	-34.39%	0.00%	30.44%	99,156	2

Source: ASX and Morningstar

Figure 38: Asian Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
ASIA
Equities - Broad
Market Vectors ChinaAMC A-Share ETF(Syn)	CETF	5.09	2.04	0.72%	0.44%	5.21%	16.59%	0.88%	24.98%	655	2
BetaShares WisdomTree Japan ETF-Ccy Hdg	HJPN	47.48	6.50	0.58%	0.17%	5.39%	31.32%	2.28%	21.33%	23,932	2
iShares Asia 50 ETF (AU)	IAA	322.28	24.20	0.50%	0.35%	4.25%	21.94%	1.48%	5.66%	7,751	3
iShares MSCI Hong Kong ETF (AU)	IHK	11.84	0.28	0.48%	0.70%	2.64%	12.84%	2.16%	9.28%	1,219	2
iShares MSCI Japan ETF (AU)	IJP	180.11	5.22	0.48%	0.13%	1.57%	10.80%	1.47%	8.42%	7,157	3
iShares MSCI South Korea Capped ETF (AU)	IKO	44.46	3.24	0.64%	0.34%	-0.80%	17.69%	0.83%	6.34%	1,040	2
iShares MSCI Singapore ETF	ISG	8.25	0.84	0.48%	0.47%	0.65%	14.70%	3.31%	18.96%	1,883	2
iShares MSCI Taiwan ETF	ITW	60.28	-6.20	0.64%	0.93%	-1.83%	15.42%	1.72%	9.07%	4,127	2
iShares China Large-Cap ETF (AU)	IZZ	79.50	1.18	0.74%	0.46%	7.34%	16.21%	1.75%	7.64%	3,758	2
Vanguard FTSE Asia ex Japan Shrs Idx ETF	VAE	35.53	7.08	0.40%	0.29%	3.28%	17.54%	2.85%	25.65%	4,399	2
Equities - Strategy
UBS IQ MSCI Japan Ethical ETF	UBJ	3.24	0.00	0.40%	0.26%	1.49%	11.44%	1.50%	2.97%	149	2
UBS IQ MSCI Asia APEX 50 Ethical ETF	UBP	4.11	0.00	0.45%	0.30%	6.25%	25.63%	0.35%	12.66%	746	2

Source: ASX and Morningstar

Figure 39: European Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
EUROPE
Equities - Broad
ETFS EURO STOXX 50? ETF	ESTX	24.77	12.79	0.35%	0.21%	5.99%	26.00%	1.08%	25.91%	2,650	2
BetaShares WisdomTree Europe ETF-Ccy Hdg	HEUR	48.29	3.73	0.58%	0.15%	3.92%	23.90%	1.67%	21.14%	26,820	2
iShares Europe ETF (AU)	IEU	699.76	75.56	0.60%	0.13%	3.99%	18.98%	2.09%	8.11%	30,483	3
Vanguard FTSE Europe Shares ETF	VEQ	115.65	29.71	0.35%	0.18%	3.71%	19.41%	2.24%	14.95%	9,948	3
Equities - Strategy
UBS IQ MSCI Europe Ethical ETF	UBE	8.89	1.06	0.40%	0.36%	4.25%	19.69%	2.48%	9.89%	1,319	2

Source: ASX and Morningstar

Figure 40: Emerging Markets Equity EFTs

Name	Code	FUM ($M)	Qtr Flows ($M)	MER	Qtr Avg Spread	3MTH Return	12MTH Return	Historical YLD	QTR AVG Liquidity	Daily Vol-QTR AVG	STAR Rating
EMERGING MARKETS
Equities - Broad
iShares MSCI BRIC ETF (AU)	IBK	32.79	3.14	0.72%	0.64%	11.06%	24.02%	1.12%	7.67%	1,557	2
iShares MSCI Emerging Markets ETF (AU)	IEM	554.64	51.72	0.72%	0.22%	5.27%	18.66%	1.16%	5.58%	17,671	3
Vanguard FTSE Emerging Markets Shrs ETF	VGE	140.49	25.25	0.48%	0.27%	5.27%	14.93%	1.71%	12.08%	8,645	3
SPDR? S&P Emerging Markets ETF	WEMG	19.92	3.93	0.65%	0.27%	5.55%	18.07%	1.39%	7.87%	2,422	2

Source: ASX and Morningstar