VAS vs A200

Question

Hi everyone! I’m trying to decide between VAS and A200 for my portfolio, but I'm not sure which one is the better fit. Can anyone share their thoughts on the differences between these ETFs and what factors to consider when choosing? Thanks in advance

Answer

Hi Grace.

The reason you can’t decide is because they are damn near identical, as the AI is pointing out.

The vast majority of people simply go for either the lowest fee (currently A200), though fees are reducing on average for both over time.  Or they go with the fund manager they trust the most (which is often Vanguard as it has been around a lot longer).

But it honestly doesn’t matter.  What matters way way more is your personal finances and how much you save and invest :)

Answer

Hello! Deciding between VAS (Vanguard Australian Shares Index ETF) and A200 (BetaShares Australia 200 ETF) is a common consideration for many investors looking to add Australian equities to their portfolios. Both ETFs aim to track the performance of Australian shares, but they do have some differences that might influence your decision depending on your investment goals and risk tolerance.

Index Coverage and Diversification:

VAS tracks the ASX 300 index, which includes the top 300 companies by market capitalization on the Australian Securities Exchange. This provides a broader exposure to the Australian equity market.

A200 tracks the ASX 200 index, comprising the top 200 companies. This focus means it’s slightly less diversified than VAS, concentrating on the larger companies within the Australian market.

Costs:

Both ETFs are known for their low management fees, but there might be slight differences. Typically, A200 is noted for having slightly lower fees compared to VAS. However, it’s essential to check the current management fees and consider other costs like brokerage fees when buying or selling shares.

Performance:

The performance of VAS and A200 can be quite similar since they both track large-cap Australian stocks. However, because VAS includes an additional 100 smaller companies, there might be slight variations in performance, especially in different market conditions.

Risk and Volatility:

With VAS’s broader diversification, it might offer a slightly more balanced risk profile, given its wider range of companies. On the other hand, the more focused exposure of A200 could mean more pronounced movements in the ETF’s price, aligning with the larger companies’ performance in Australia.

Liquidity:

Both ETFs are generally well-traded, offering good liquidity. However, the larger size and longer history of VAS might give it a slight edge in terms of trading volume and liquidity.

When choosing between VAS and A200, consider your investment goals, risk tolerance, and the importance of diversification in your portfolio. If you prefer broader exposure to the Australian market, including some smaller companies, VAS might be more suitable. If you are looking for a slightly lower cost option focusing on the top 200 companies, A200 could be the better fit.

Pearler offers a platform that makes it easy to invest in both VAS and A200, among other ETFs, with features that support long-term investing and goal tracking. This can be particularly useful when you’re looking to build and manage a diversified portfolio aligned with your financial goals.

You can find out more about this topic here: How Do I Choose Between Vas A200

Disclaimer

I am an AI-powered chatbot and not a financial advisor. The information provided is for educational and informational purposes only and should not be considered as financial advice. Investing involves risks, and past performance is not indicative of future results. It is important to conduct thorough research and consider your own financial situation and risk tolerance before making any investment decisions. It is always recommended to consult with a qualified financial advisor or professional before making any investment decisions.

Answer

Grace asked about VAS or A200, I want to add in IOZ &amp; VHY to the comparison chat!

What do ppl think about IOZ (top200) in comparison to A200 &amp; VAS?
Considered to be as good/same? Its not spoken about as much.
 I have A200 but I am thinking to swap to IOZ because DRP takes so long to buy another unit in A200 but you can get @ 3 units of IOZ for 1 unit of A200.
Any thoughts on that?
Im considering either swapping to IOZ … OR starting VHY &amp; DCA to that monthly (being 50yrs old) for dividend that will come in time.
Interested in your opinions wise tribe!  (which is not financial advice :&gt;)
Cheers!

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Grace Johnson.

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Dave Gow - Strong Money Australia

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