VDGH vs DZZF or both?

Hi Helen,

All in one funds make a lot of sense for a set and forget approach so you’re on the right track there.

Investing in both VDHG and DZZF would be considered overlapping or double dipping. But it’s not necessarily a problem, and if you really wanted to own both, you could.

The lack of popularity is likely due to the number of ethical funds on offer these days, plus the lower popularity of ESG/ethical funds in general compared to normal index funds.

But DZZF has almost $100m in the fund, which isn’t bad for a relatively newer fund, so it seems unlikely that Betashares would shut it down anytime soon. If they did though, the portfolio would be sold and you’d simply get your money back.

Cheers, Dave

Hello Helen,

It’s great to hear that you’re considering investing with a focus on ethical considerations, especially concerning the environment and climate change. Diversified ETFs like DZZF can be an excellent choice for someone looking for a hands-off investment approach while also wanting to adhere to ethical investment standards.

DZZF, as you mentioned, is designed to be an ethical equivalent to more traditional diversified ETFs like VDHG, but with a focus on excluding investments in fossil fuels and other sectors that might not meet certain environmental, social, and governance (ESG) criteria. This ETF allocates 90% to growth assets and 10% to defensive assets, with a significant portion in both Australian and international equities that are filtered for ESG compliance.

Regarding your concern about DZZF’s popularity, it’s important to note that the popularity of an investment product doesn’t necessarily correlate with its suitability for your personal investment goals and ethical preferences. Ethical ETFs like DZZF are relatively newer entrants in the market compared to more established funds, and they might attract a specific investor niche interested in sustainable investing.

Splitting your investment between DZZF and VDHG could be considered if you want to balance between a strictly ethical focus and broader market exposure. However, this approach might lead to some overlap in holdings, particularly in the equity components, potentially increasing your exposure to certain sectors or regions more than intended. It’s crucial to look at the specific holdings and sectors covered by each ETF to ensure that you maintain the diversification and balance that aligns with your investment strategy and ethical considerations.

At Pearler, we focus on providing investment options that align with various investor values and goals, including those who prioritize ethical and ESG-compliant investments. DZZF could be a suitable option for you as it aligns with your desire for a hands

Show more.....