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Vanguard ETFs now available on ASX

Discussion in 'Exchange Traded Funds (ETF)' started by Waimate01, 11th May, 2009.

  1. Waimate01

    Waimate01 Well-Known Member

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    26th May, 2008
    Posts:
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    Location:
    Sydney
    For those who have been awaiting the event, Vanguard ETFs are now available:



    Vanguard Australian Shares Index ETF
    Code: VAS
    Tracks: S&P/ASX 300 Index
    Fees: 0.27 %


    Vanguard All-World ex-US Share Index ETF
    Code: VEU
    Tracks: FTSE All-World ex-US Index
    Fees: 0.25 %


    Vanguard US Total Market Shares Index ETF
    Code: VTS
    Tracks: MSCI US Broad Market Index
    Fees: 0.07%
     
  2. ashwright

    ashwright Well-Known Member

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    Location:
    Brisbane, Qld
    From a price/fee point this seems similar to the SPDR ASX200 ETF. Their fees are 0.286%.

    I believe the SPDR ASX 200 ETF, actually buys all 200 shares. While the Vanguard ASX300 ETF, "employs optimisation techniques to select a representative sample of securities in the index, allowing for individual security
    weightings to vary marginally from the index from time to time" and "Futures may be used to gain market exposure without investing directly in securities." (Page 8 of the PDS).

    Does anyone know what kind of difference this makes?
     
  3. kevinb

    kevinb Well-Known Member

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    MENAI
    I note that the Vanguard pays quarterly rather than half yearly compared to the Spydr. May help the cash flow

    Rgds

    kevinb
     
  4. AsxBroker

    AsxBroker Well-Known Member

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    Hi Ashwright,

    For the Vanguard Managed Funds the optimisation strategies are essentially buying the top 270 shares from the ASX300. The reasoning for this is that the bottom ASX300 stocks move in and out of the index resulting in additional costs (buying and selling stocks) and also potential Capital Gains issues, hence, remove the cause and avoid the problem.

    Investing in Futures is a cheaper way than investing in the stocks themselves (ie, lower brokerage costs) which could give the same returns with lower transactional costs.

    Cheers,

    Dan
     
  5. benbegg

    benbegg Active Member

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    I could not see where VAS are planning to pay quarterly. Can you highlight this? It is not on the web site. Is it in the PDS? Also is there a Market Maker for the stock on the ASX to ensure liquidity? If I put in a high purchase price overnight, does this stock partake in the pre-open auction?
     
  6. austing

    austing Well-Known Member

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    Location:
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    It does appear that the distribution will be quarterly - refer to link:

    http://www.vanguard.com.au/shadomx/...1-5EF1-64E0-BBEB57761400&siteName=vanguardaus

    Yes, there are a "obligatory" market makers in place - refer to link (toward bottom of page):

    https://myasx.asx.com.au/products/etfs_etcs/types/australian_etfs.htm

    Although not really offering much more than STW it is still welcome addition to our rather poor selection of local ETFs in Australia. I just wish ETFs would catch on here as they have overseas as they are a great way to trade/invest.

    Cheers - Gordon
     
  7. AsxBroker

    AsxBroker Well-Known Member

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    8th Sep, 2007
    Posts:
    1,448
    Location:
    Sydney, NSW
    Hi,

    Most traders would probably be using derivatives rather than an ETF due to lower trading costs and more bang for their buck.

    Cheers,

    Dan

    PS This is general information. Speak to your FPA registered Financial Planner or ASX licensed stockbroker before making an investment decision.