With a brand new year upon us, I thought it was good time to update the last blog on my favourite ETF’s on the ASX for 2020 and beyond.

With over $56 billion in 204 exchange-traded products (ETPs) now listed on ASX, according to the ASX Monthly Investment Products Report at the end of October, the Australian ETP industry has grown by leaps and bounds since its launch 18 years ago.

To help me keep up with the ever changing ETF landscape, I have built a NEW ‘ETF Portfolio Generator’ that allows you to compare every ETF on the ASX and build a diversified ETF portfolio that will no doubt keep you in good stead on your investment journey. You can find it here:

Two other tools I still like to use to compare and re-balance the portfolio are:

Vanguard Fund compare 

Investing.com – Chart compare

I’ll keep the format roughly the same and add in some screenshots from the ‘Sector Compare’ page in our NEW ‘ETF Portfolio Generator’ This page allows you to easily compare ETF’s sectors on the ASX in a multitude of different ways.

In this blog, I’ll go through the different sectors and ETF’s I prefer. Before doing so please note:

This is not Financial advice, just an opinion from Investment Tracker. Everyone is in a different financial situation with different financial needs and objectives. Please seek out a professional Financial Advisor for advice before buying any ETF’s associated with this blog.

Australia broad

  1. MVW 
  2. VAS 
  3. VSO
  4. EX20 
  5. A200 

All are really close. For exposure to the index, VAS comes out in front for me. Vanguard are the most trusted financial manager in the world. It’s performing well and has the more diversification with exposure to the top 300 companies on the ASX. I think MVW trumps them all with an equal weight exposure to companies with blue-chip qualities. This gives the investor better diversification again seeing as the top 20 stocks on the ASX are banks and miners. For exposure to the smaller companies, I like VSO and EX20.

Australia sectors / strategy

This sector comes down to the investors thoughts and strategies for investing. All of these ETF’s can play a part in a portfolio. Geared funds can be used to good effect and ETF’s with high dividend yields can be great for people who have retired and seek the income. If i was to choose from this list (I’m 37 years old) I like:

  1. FAIR
  2. GRNV

Apart from investing responsibly or to align with your views, research has shown ethical ETF’s are outperforming and ethical companies usually have a good management team being able to adapt to change.

Global

  1. NDQ
  2. MOAT
  3. IVV
  4. IJR
  5. VGS

My favourite ETF in this sector and probably overall is NDQ. How could this not be part of a portfolio? Get access to the biggest and best companies in the world (ex financials) – Microsoft, Apple, Google, Amazon to name a few. MOAT is another great performing ETF consisting of US companies with sustainable competitive advantages according to Morningstar’s equity research team. You can’t go wrong with the S&P500 (Warren Buffet advises to put 90% of your money into this and 10% into bonds). IJR is great to get access to the up and coming small caps in the US. If you want a broad and diverse ETF that could easily be 50% of your portfolio you can keep it simple and invest in VGS (International index excluding Australian equities).

Asia

  1. ASIA
  2. NDIA
  3. IAA
  4. CNEW

I’m big on TECH, so I like ASIA alot. Like the FANG stocks in the US, ASIA has some tech giants just as big. Alibaba, Tencent, Samsung, Taiwan semiconductors etc make up a big weighting in this ETF and provide massive growth opportunities. I like NDIA and have written a blog on why here – INDIA – THE NEXT ECONOMIC POWERHOUSE?  IAA gives you access to the 50 of Asia’s biggest companies. CNEW is a new ETF and looks great – CNEW gives investors a portfolio of the most fundamentally sound companies in China having the best growth prospects in sectors making up ‘the New Economy’.

Emerging markets

I like VGE here.

Global sectors

What are you bullish on? This is where ETFs are great. You can still invest in the space you like and get instant diversification and less risk. My favourites:

  1. ROBO
  2. RBTZ
  3. TECH
  4. HACK
  5. GDX

Artificial intelligence and robots are here, and I want to be investing in it. THE ROBOTS ARE HERE

TECH and HACK look great and I don’t mind GDX for a gold play.

Global strategy

  1. QUAL
  2. ETHI
  3. QLTY

QUAL is a great ETF. My kids own one ETF at the moment, and this is it. The performance has been unreal – VanEck Vectors MSCI World ex Australia Quality ETF (QUAL) invests in a diversified portfolio of quality international companies listed on exchanges in developed markets around the world (ex Australia). ETHI is the best ethical ETF in my opinion and QLTY is the new kid on the block and looks solid.

Infrastructure

No real opinion here but GLIN is the best performer in the space.

Australian property

  1. VAP
  2. MVA

Again, they all are very close here and although it’s not the best performer I will take the Vanguard ETF over the others. Lowest management fee and by far has the most FUM (funds under management). Remember VAS and other ASX index funds will already have exposure to the equities in these property ETF’s.

Global property

No real opinion here but maybe DJRE seeing as it has alot more FUM.

Fixed income / Bonds

Bonds don’t really appeal to me, but if I was going to buy some it would be VAF for Australia and VIF for International.

Cash

AAA for me.

Mixed asset

Set and forget. Buy one ETF that has you fully diversified across all asset classes depending on your risk factor. I’m young so I obviously like the higher risk / higher growth options below.

  1. VDHG
  2. VDGR

Beta shares have just replicated the Vanguard funds so it will be interesting to see how they compare.

DBBF BetaShares Diversified Balanced ETF Mixed Asset
DGGF BetaShares Diversified Growth ETF Mixed Asset
DHHF BetaShares Diversified High Growth ETF Mixed Asset
DZZF BetaShares Diversified Conservative Income ETF Mixed Asset

Currency

Bullish on any currency ETF’s? Not for me.

Commodities

I like PMGOLD here. PMGOLD provides a fully paid call option to one- hundredth of a troy ounce of physical gold.

I have to mention ETFS Physical Palladium (ETPMPD) here. It’s been the best performing commodity for 3 years straight and in total for the last 5 years.

Conclusion

These days it’s so easy to build a market beating ETF portfolio. You can keep it basic or diversify with many of your favourite ETF’s. Stick to the basic Investing principles and you’re sure to be successful in the long term.

With my latest ETF Portfolio Generator I have a preset portfolio that has performed as per the below graphic. (Average return 100k invested for month of December 2019). This gives you an insight on what is possible but is no guide for future returns.

References: Vanguard, Investing.com

This is not Financial advice. I’m not a Financial professional. Follow this information at your own risk.

Happy investing!