Vanguard seeks to increase global equity ETF range
Vanguard has indicated it is actively trying to meet the demand for international ETFs with its next ETF launches sitting in this space.
According to the Betashares annual ETF review, international equity ETFs saw $15.1 billion in inflows during 2024, which was a fivefold increase on the $2.9 billion in inflows in the previous year. The sum was more than double the inflows of $7.1 billion which went into Australian equities.
Similarly, research by VanEck found three in four Australian investors say they are looking to invest in international ETFs in the next 12 months, representing a 27 per cent rise compared to last year.
In light of this, Vanguard said it is exploring how it can expand its offering in the international space.
It currently offers 31 ETFs, and its domestically focused Vanguard Australian Shares Index ETF is the largest ETF in Australia at $18.4 billion.
Speaking at a Calastone event in Sydney, Patrick Andriske, senior specialist for ETF capital markets at Vanguard, said: “Vanguard is looking at offering more global equity products in the future. They are on our agenda, and we have a few ideas in the pipeline.
“The new products we are bringing to market, we want to make sure we are efficient in terms of negotiating lower fees with exchanges, custodians, index providers, etc., and making sure we can pass those savings onto our customers.”
It currently offers 11 international equity ETFs divided between country-specific and global ones.
The global ones are Vanguard MSCI Index International Shares, Vanguard MSCI Index International Shares (Hedged), Vanguard All-World ex-US Shares Index ETF, Vanguard Ethically Conscious International Shares Index, Vanguard MSCI International Small Companies Index, Vanguard Global Value Equity Active ETF, and Vanguard Global Minimum Volatility Active ETF.
Meanwhile, the country-specific ones are Vanguard FTSE Emerging Market Shares, Vanguard FTSE Asia ex Japan Shares Index, Vanguard FTSE Europe Shares, Vanguard All-World ex-US Shares Index ETF, and Vanguard US Total Market Shares Index ETF.
The provider recently launched two diversified ETFs: Vanguard Diversified All Growth Index ETF (VDAL) and the Vanguard Diversified Income ETF (VDIF).
Looking at the VDAL, the all-equities diversified ETF invests 100 per cent in growth assets and is designed for Australian investors with a high risk tolerance who are seeking long-term capital growth. The investment vehicle provides exposure to more than 6,000 equities listed over 50 global markets, such as Australian equities, global equities, emerging markets and global small caps.
Meanwhile, the VDIF is constructed for Australian investors who are looking for regular income with some capital growth potential, without giving up the benefits of diversification. It offers exposure to more than 12,000 securities through access to underlying funds that invest in investment grade fixed income and corporate bond strategies, as well as high dividend yield equities.
AUTHOR
Laura Dew
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