VETH - Vanguard Ethically Conscious Australian Shares ETF

[Dona Ferentes]

VANGUARD ETHICALLY CONSCIOUS AUSTRALIAN SHARES ETF​

ASX: VETH

ETF: Equity Australia Large Blend

The ETF provides low cost exposure to stocks listed on the Australian Securities Exchange (ASX) and excludes companies with significant business activities involving fossil fuels, nuclear power, alcohol, tobacco, gambling, weapons, adult entertainment and a conduct related screen based on severe controversies. Diversification requirements are applied to restrict the proportion of the index invested in any one industry to +/-5% of the industry weights of the FTSE Australia 300 Index, subject to any limitation issues resulting from the exclusionary screening.

Management fee : 0.16% p.a​

Indirect costs : 0.01% p.a​

AUM $330million

 

[divs4ever]

Total Holdings 250

Top 10 Holdings

CODE	COMPANY	ASSET
CBA	Commonwealth Bank of Australia	9.94%
CSL	CSL Ltd	8.58%
NAB	National Australia Bank Ltd	5.95%
WBC	Westpac Banking Corp	4.98%
ANZ	Australia and New Zealand Banking Group Ltd	4.62%

CODE	COMPANY	ASSET
MQG	Macquarie Group Ltd	3.83%
WES	Wesfarmers Ltd	3.78%
TLS	Telstra Corp Ltd	3.24%
GMG	Goodman Group	2.81%
TCL	Transurban Group	2.67%

pays quarterly

but to Vanguard's credit they don't charge an arm and a leg for the extra screening ( like some rivals do )

 

[Ann]

Big volume spike yesterday, the price jumping above the 200dsma. Normally I would be thinking the volume spike might be calling a top but in this case, I think it was because it achieved the 200dsma. Could be wrong of course, let's see.

 

[Sharkman]

Total Holdings 250

Top 10 Holdings

CODE	COMPANY	ASSET
CBA	Commonwealth Bank of Australia	9.94%
CSL	CSL Ltd	8.58%
NAB	National Australia Bank Ltd	5.95%
WBC	Westpac Banking Corp	4.98%
ANZ	Australia and New Zealand Banking Group Ltd	4.62%

maybe i'm being too cynical, but how on earth can they call it an ethically conscious fund when it contains the big banks?

the numerous fiascoes over the last several years culminating in a royal commission notwithstanding, surely they have significant involvement with fossil fuels, either lending to fossil fuel companies and/or running institutional trading desks that deal fossil fuel related instruments (swaps, futures etc.)

there's no way i'd be putting the big banks anywhere near a fund that has the word "ethical" in it. i do invest/trade some of them myself, mainly to strip their divs for franking credits, but i'd never call them ethically conscious. charging fees for no services and signing people up to products totally unsuitable for them isn't exactly ethical behaviour. that's just me though. i guess Vanguard sees things differently.

 

[Belli]

how on earth can they call it an ethically conscious fund when it contains the big banks?

I get you but it is a different definition of "ethical'"

Vanguard uses the FTSErussell methodology to include or exclude companies from the fund.

FTSE Global Choice Index Series

Our FTSE Global Choice Index Series helps investors align their portfolio with their values by de-selecting companies based on conduct or products.

www.ftserussell.com

 

[Sharkman]

I get you but it is a different definition of "ethical'"

Vanguard uses the FTSErussell methodology to include or exclude companies from the fund.

FTSE Global Choice Index Series

Our FTSE Global Choice Index Series helps investors align their portfolio with their values by de-selecting companies based on conduct or products.

www.ftserussell.com

fair enough, including them isn't Vanguard's decision in that case. it's still not entirely clear to me how FTSE Russell can conclude that the big banks meet the criteria. even if the recent wealth management etc. fiascoes don't factor into the methodology, involvement with fossil fuels does, and surely they would all have significant involvement in lending to fossil fuel companies and trading fossil fuel related instruments on their institutional desks.

at any rate, if i was to be looking for an ethical fund to invest in (i'm not), i wouldn't pick anything that contains the big banks. i just think putting "Australian big banks" and "ethically conscious investing" in the same sentence fails the pub test, and fails it miserably.

 

[Sharkman]

"Is it ethical to invest in fossil fuels?

Turns out almost half of Australia’s sustainable fund managers think so."

The unsustainable secret of almost half of Australia’s ‘sustainable’ funds

Can it be ethical to invest in fossil fuels? Turns out more than half of Australian sustainable fund managers think so.

www.smh.com.au

the second last para of the article sums up my cynical view on what's happening here in a nutshell:

"It’s greenwashing – an attempt to cash in on the lucrative sustainable investment trend by tricking clients into a false sense their money is being used for good."

to be clear i'm not strongly against investing in fossil fuels myself, my own portfolio likely holds quite a bit of them indirectly thru index ETFs, but then again i'd never call my portfolio an "ethically conscious" portfolio to begin with.

 

[JohnDe]

"Is it ethical to invest in fossil fuels?

Turns out almost half of Australia’s sustainable fund managers think so."

The unsustainable secret of almost half of Australia’s ‘sustainable’ funds

Can it be ethical to invest in fossil fuels? Turns out more than half of Australian sustainable fund managers think so.

www.smh.com.au

the second last para of the article sums up my cynical view on what's happening here in a nutshell:

"It’s greenwashing – an attempt to cash in on the lucrative sustainable investment trend by tricking clients into a false sense their money is being used for good."

to be clear i'm not strongly against investing in fossil fuels myself, my own portfolio likely holds quite a bit of them indirectly thru index ETFs, but then again i'd never call my portfolio an "ethically conscious" portfolio to begin with.

Depends on your point of view. Everyone is allowed to choose, especially when it's their money.

Ethical investing refers to the practice of using one's ethical principles as the primary filter for the selection of securities investing. Ethical investing depends on the investor's views.

 

[divs4ever]

maybe i'm being too cynical, but how on earth can they call it an ethically conscious fund when it contains the big banks?

my sentiment , exactly

now sure i have a large holding ( for me ) holding in MQG , but in no way would i consider them ESG , even though they throw big money at Green Bank and various 'climate-change-friendly ' investments , the Europeans call MacQuarie a 'vampire squid ' and i agree with that BUT MQG shares those big profits with share-holders ( unlike some ) .

now when i was invested in AEF ( several years ago ) 'ethical ' included corporate governance and i was fine with such a stance , sure returns MIGHT have been better , but the portfolio value didn't take a hit over some corporate scandal and so long term investors were content ( less chance the fund would go to zero )

i reckon without the inclusion of corporate governance , ESG has nothing to attract me

 

[Sharkman]

Depends on your point of view. Everyone is allowed to choose, especially when it's their money.

Ethical investing refers to the practice of using one's ethical principles as the primary filter for the selection of securities investing. Ethical investing depends on the investor's views.

absolutely everyone should be allowed to choose, that's not in question. what is in doubt though is whether they are being misled. now this is an investment/trading forum, so naturally the vast majority of people on here will be inclined to carefully research and understand exactly what they are investing into before making a decision.

but i would say a significantly lower proportion of the general population would be inclined to do so, a lot of people will see the word "ethical" in the name, assume it's consistent with their principles, and simply take the plunge without checking the finer details. some people i know IRL who have little interest in finance will take a cursory look at the alternatives, pick whichever one "sounds good", and simply go for that so they can get back to doing whatever it is they enjoy. and that's if they even invest at all, some people i know are completely disinterested and park their funds in the bank earning 0.05% interest.

that's the point i believe the paragraph is trying to make. sure people are allowed to choose for themselves, but it should be an informed decision, and many won't (or can't) delve into the fine print to see what's going on. obviously i can't speak for other people, but to me including big banks and fossil fuels then saying your fund is ethical fails the pub test, and i dare say that a lot of people who invest in such a fund without looking into the details will be rather shocked if they find out what they're actually investing in.

 

[JohnDe]

absolutely everyone should be allowed to choose, that's not in question. what is in doubt though is whether they are being misled. now this is an investment/trading forum, so naturally the vast majority of people on here will be inclined to carefully research and understand exactly what they are investing into before making a decision.

but i would say a significantly lower proportion of the general population would be inclined to do so, a lot of people will see the word "ethical" in the name, assume it's consistent with their principles, and simply take the plunge without checking the finer details. some people i know IRL who have little interest in finance will take a cursory look at the alternatives, pick whichever one "sounds good", and simply go for that so they can get back to doing whatever it is they enjoy. and that's if they even invest at all, some people i know are completely disinterested and park their funds in the bank earning 0.05% interest.

that's the point i believe the paragraph is trying to make. sure people are allowed to choose for themselves, but it should be an informed decision, and many won't (or can't) delve into the fine print to see what's going on. obviously i can't speak for other people, but to me including big banks and fossil fuels then saying your fund is ethical fails the pub test, and i dare say that a lot of people who invest in such a fund without looking into the details will be rather shocked if they find out what they're actually investing in.

Everyone that makes a purchase should do their homework and read the product details, and that includes investing in ETFs. If the buyer purchases without research and gets the wrong product, you can't blame the seller.

 

[Garpal Gumnut]

There is a season to be ethical and this ain't one of them.

gg

 

[Dona Ferentes]

There is a season to be ethical and this ain't one of them.

gg

Ethical is a bit like 'motherhood'; you can't really argue against it.

I think we're ignoring the other qualifier in the title: Conscious.

It's all really just marketing..

 

[Garpal Gumnut]

Ethical is a bit like 'motherhood'; you can't really argue against it.

I think we're ignoring the other qualifier in the title: Conscious.

It's all really just marketing..

I'm all in favour of Motherhood.

Just not the Georgetown Lab sandwiches. The most insipid I've ever eaten.

Ethics change, Motherhood doesn't, and I wouldn't go back to Georgetown for all the sandwiches in China.

gg

 

[Garpal Gumnut]

my sentiment , exactly

now sure i have a large holding ( for me ) holding in MQG , but in no way would i consider them ESG , even though they throw big money at Green Bank and various 'climate-change-friendly ' investments , the Europeans call MacQuarie a 'vampire squid ' and i agree with that BUT MQG shares those big profits with share-holders ( unlike some ) .

now when i was invested in AEF ( several years ago ) 'ethical ' included corporate governance and i was fine with such a stance , sure returns MIGHT have been better , but the portfolio value didn't take a hit over some corporate scandal and so long term investors were content ( less chance the fund would go to zero )

i reckon without the inclusion of corporate governance , ESG has nothing to attract me

maybe i'm being too cynical, but how on earth can they call it an ethically conscious fund when it contains the big banks?

the numerous fiascoes over the last several years culminating in a royal commission notwithstanding, surely they have significant involvement with fossil fuels, either lending to fossil fuel companies and/or running institutional trading desks that deal fossil fuel related instruments (swaps, futures etc.)

there's no way i'd be putting the big banks anywhere near a fund that has the word "ethical" in it. i do invest/trade some of them myself, mainly to strip their divs for franking credits, but i'd never call them ethically conscious. charging fees for no services and signing people up to products totally unsuitable for them isn't exactly ethical behaviour. that's just me though. i guess Vanguard sees things differently.

I would agree totally.

The Australian banks have been involved in some pretty awful stuff, all the way from facilitating human slavery to money laundering.

And they have gotten away with it.

I'm thinking of reporting this ETF to ASIC.

Ethical it ain't.

gg