VAS v A200 v IOZ performance comparison

[Frankieplus]

I'm trying to learn how to research a stocks performance, is this tool from Sharesight ok?

I want to invest in the ASX index and have 3 options. VAS, A200 and IOZ. My immediate thought was to go VAS but then I discovered the other 2 and wanted to compare performance.

According to Sharesight, VAS wins in the 5 year comparison but IOZ wins in the 2 year comparison, is this correct?

I am posting the results below in case I am missing something or not understanding something.

Please click on thumbnails..

5 year comparison of all 3


2 year comparison of all 3



-Frank

 

[Lone Wolf]

I can see you've selected the correct time frame at the top. But look at the actual start dates in each image. They don't match.

 

[Frankieplus]

I can see you've selected the correct time frame at the top. But look at the actual start dates in each image. They don't match.

Hey you're right. I don't know why.. I tried again and A200 doesn't seem to want to show me a proper 5 year timeframe, it could be its a newer ETF.

I generated the 2 year chart again..

 

[Cam019]

@Frankieplus Price comparison only (excluding dividends) of VAS, IOZ and A200 from most recent ETF start date (A200 - 08/05/2018)

 

[Frankieplus]

@Frankieplus Price comparison only (excluding dividends) of VAS, IOZ and A200 from most recent ETF start date (A200 - 08/05/2018)

View attachment 102008

But thats share price only. I can see A200 share price was more but its all relative. Its all about how much percentage you make right?

Higher share price doesn't mean its a better investment does it? I'm by no means an expert.

-Frank

 

[Sharkman]

apologies in advance if this isn't helpful, but my thoughts on the subject:

• there's no need to over complicate things here, these ETFs all follow a broadly similar basket of underlyings, VAS is ASX 300 i believe, the others are ASX 200. there shouldn't be any significant differences
• past performance is no guarantee of future results
• more relevant things to look for in index ETFs are the management expense ratio, tracking error and liquidity/size
• MER is fairly self explanatory, you want this as low as possible to reduce the fees the fund manager takes out
• tracking error is how accurately the fund's performance follows that of the underlying index, again you want this as low as possible, so you know you are replicating the index as closely as possible
• liquidity/size, you'll want to see an AUM of at least a few hundred mil (which i'm fairly sure all 3 of those have) as a reasonable indication of stability and liquidity (too small means it could be too illiquid or swing wildly based on the actions of a small number of significant holders). liquidity will affect spreads, though for a long term investment this is of minor importance at best, you're not gonna care whether your cost base is $65 or $65.50 in a couple of decades time when (hopefully) they're a few hundred $ a pop

 

[Frankieplus]

apologies in advance if this isn't helpful, but my thoughts on the subject:

Actually that was very helpful, thanks.

 

[Bill M]

Hey you're right. I don't know why.. I tried again and A200 doesn't seem to want to show me a proper 5 year timeframe, it could be its a newer ETF.

This ETF is fairly new. Only started on May 7th 2018 so that's why it can't show you longer years.

• MER is fairly self explanatory, you want this as low as possible to reduce the fees the fund manager takes out

The A200 ETF is apparently the lowest MER in Australia at only .07% per annum. It's giving the industry a big shake up. If I was going to buy an ETF to cover the Australian sharemarket this would be the one I would buy. Why pay any more fees for the same thing if you don't have to? Good tip, cheers.

 

[Sharkman]

The A200 ETF is apparently the lowest MER in Australia at only .07% per annum. It's giving the industry a big shake up. If I was going to buy an ETF to cover the Australian sharemarket this would be the one I would buy. Why pay any more fees for the same thing if you don't have to? Good tip, cheers.

i've seen speculation that this is because they use a different index tracker (Solactive vs S&P) which charges them less fees, hence they are able to lower the MER themselves. it's possible that the Solactive index is in some way inferior to the S&P one, though i have yet to see any conclusive evidence of this. the difference could well be the S&P brand name and nothing else.

 

[Bill M]

I wasn't too sure what a Solactive ETF was so I looked it up and found this at Morningstar.
---
A200 offers a diversified Australian equity portfolio. It tracks the lesser known Solactive Australia 200 Index, but Prineas insists there is little to separate this benchmark from established indexes such as the S&P/ASX 200 Index.

"There are minor differences—for example, S&P uses a relative measure of liquidity, while Solactive’s index requires an absolute minimum amount of liquidity before a stock is included," he says.

"In reality there is little difference in the index constituents—both benchmarks are driven by a market-cap methodology that offers exposure to 200 of Australia’s largest companies."

https://www.morningstar.com.au/etfs/article/the-5-etfs-drawing-in-aussie-investors/188962
---

 

[Sharkman]

thanks for sharing that. TBH i don't see much fundamental difference between the two either, the methodologies are slightly different, but i don't think one can conclusively say that one is better than the other at this stage. if i was looking to invest in an ASX index ETF (i'm not, as for the last few years my strategy has been to invest all new funds into international ETFs for macroeconomic reasons, keeping my direct ASX holdings constant) i would probably pick A200 for the lower MER too.