Spotlight: InvestSMART International Equities Portfolio

Find out who the InvestSMART International Equities Portfolio suits, the fees it charges, how it has performed and how it stacks up against its peers.

By InvestSMART · 20 Nov 2024

By InvestSMART ·
20 Nov 2024 · 5 min read

It's been a decade since InvestSMART launched our first investment portfolios. The International Equities Portfolio was the first of our single asset class portfolios to hit the market, making its debut on 24 October 2014. Here's what you need to know.

About the InvestSMART International Equities Portfolio

The International Equities Portfolio invests in one to 10 exchange-traded funds (ETFs) to provide broad exposure to international equities across different market sectors and/or regions.

It is best suited to Aussies investing for longer-term goals as the minimum suggested investment timeframe is seven years.

Here are a few quick facts about the International Equities Portfolio:

Inception date: 24 October 2014
Suggested timeframe: 7-plus years
Risk: Very high
Minimum initial investment: $10,000
Management fee: 0.44% p.a. capped at $880 p.a.
Admin fee: 0.11% p.a. includes buy-side brokerage costs.
Benchmark Index: MSCI World (ex-Australia) Total Return Index, unhedged

Where does the InvestSMART International Equities Portfolio invest?

The International Equities Portfolio has 99.5% invested in international shares with the remaining 0.5% in cash.

The ETFs that InvestSMART currently includes in the International Equities Portfolio are:

Some of the underlying ETF holdings include Microsoft, Apple, NVIDIA, Taiwan Semiconductor Manufacturing and Amazon.com.

What are the fees?

InvestSMART's annual management fee is 0.44%, which equates to $44 per year on a $10,000 investment (the minimum). The management fee is capped at $880 per year for balances of $200,000 or more.

There is a flat admin fee of 0.11% per year, which includes all buy-side brokerage costs. This means you won't pay extra when you invest or add funds. Brokerage fees apply to sell transactions (including rebalances). Brokerage costs are $4.40 per trade or 0.088% of the value of the trade (whichever is higher) and are paid entirely to a third-party broker.

There are also indirect costs charged by the underlying ETFs and for the International Equities Portfolio these are estimated to be 0.18% a year.

How has the InvestSMART International Equities Portfolio performed?

The International Equities Portfolio has been a strong performer, averaging 11.67% a year since its inception in October 2014. In dollar terms, that means if you had invested $10,000 in the International Equities Portfolio when it first launched, your investment would have been worth $30,259 at the end of October 2024 - that's a total increase of 202.59%.

In the 12 months to the end of October 2024, the International Equities Portfolio provided a stellar return of 30.92%.

InvestSMART International Equities Portfolio performance

	1 year	3 yrs p.a.	5 yrs p.a.	SI p.a.¹
Capital return	27.92%	9.03%	10.44%	9.77%
Income return	3.00%	2.31%	2.28%	1.90%
Total return	30.92%	11.34%	12.72%	11.67%

Returns to 31 October 2024. ¹Since inception on 24 October 2014.

How does the InvestSMART International Equities Portfolio compare to its peers?

The International Equities Portfolio has outperformed the majority of its peers both over the short and long term. As you can see from the table below, it has returned 12.72% p.a. over five years. The average annualised returns of its peer funds in this category was 8.86% over that same period.

International Equities Portfolio performance vs peers

	1 year	3 yrs p.a.	5 yrs p.a.	SI p.a.¹
Growth Portfolio	30.92%	11.34%	12.72%	11.67%
Peers	23.42%	8.26%	8.86%	8.73%
Excess to peers	7.50%	3.08%	3.86%	2.94%

Returns to 31 October 2024. ¹Since inception on 24 October 2014.

With a flat admin fee of 0.11% per year and a management fee of 0.44% per year (capped at $880 per year), the International Equities Portfolio's annual fee is lower than the average fee of its peer funds, which is sitting at 1.19% per year at the time of writing.

Key takeouts

The InvestSMART International Equities Portfolio is ideal if you are looking for exposure to global share markets to diversify your investment portfolio. It's an easy, low-cost way to invest in some of the world's biggest companies across Europe, Asia and the US but you need to be prepared for the volatility that can come with investing overseas. So it's vital to take a long-term view.

The fees are competitive and, while past performance is not a guarantee of future results, the portfolio's returns have been stronger than the majority of the competition.