Every year, Pearler runs the numbers on which ETFs its community actually owns.
It’s not a ranking of the best-performing ETFs. It’s not based on how much money is invested in each fund. It simply counts how many individual investors hold each ETF. That makes the list a little more interesting than your usual “best ETFs” roundup.
In the latest episode of the Get Rich Slow Club, Ana sits down with Pearler founder and CEO Nick Nicolaides to go through the top 10, talk about what’s changed and, perhaps more importantly, what hasn’t.
The short version? Not much. VAS is still sitting comfortably at number one, and most of the list has been remarkably consistent over the years. But there are a few changes worth paying attention to, and plenty to learn from the way Pearler investors are putting their portfolios together.
So, what’s the point of a popularity list?
Before getting into the ETFs themselves, there’s an important disclaimer. Nick says the list was never intended to be a shopping list. With thousands of ETFs available, it’s simply somewhere to start.
That’s useful because one of the hardest parts of investing can be figuring out what you actually need to research in the first place. The list gives you a sense of what other investors are looking at. From there, you can dig into the holdings, fees, geographic exposure and strategy and decide whether any of it makes sense for you. As Nick puts it, it’s about giving investors “where to start reading”, rather than telling them what to buy.
So, with that out of the way, here’s what the Pearler community is holding.
10. VHY — Vanguard Australian Shares High Yield ETF
The newest arrival in the top 10 is VHY, which invests in Australian companies with higher forecast dividend yields. It’s also the ETF that pushed VTS – Vanguard’s US Total Market Shares Index ETF – out of the top 10.
Nick and Ana wonder whether its rise reflects a renewed interest in dividends and income, particularly following recent discussion around potential changes to capital gains tax.
But Nick makes an important point: don’t invest purely for the tax outcome. A lower tax bill doesn’t necessarily mean a better investment. If an investment makes you less money but you pay less tax on it, you haven’t somehow come out ahead. The bigger question is whether the ETF fits your overall strategy.
VHY’s management fee is around 0.25%.
9. VEU — Vanguard All-World ex-US Shares Index ETF
VEU gives investors exposure to large companies around the world, excluding the US. That might sound like a fairly niche choice in a market where so much attention is focused on American tech stocks, but that’s exactly why Nick likes it. He holds VEU himself, partly because his portfolio is already heavily exposed to the US.
For him, owning companies outside America is about balance. He knows he might miss some upside if US markets continue to outperform, but he likes having something that isn’t tied to the same market. It’s also an ETF that can be paired with a US-focused fund to build a broader global portfolio.
The management fee is 0.04%.
8. ETHI — BetaShares Global Sustainability Leaders ETF
ETHI takes a different approach. Rather than simply tracking a broad global market, it screens companies against ESG criteria.
Ana holds it herself, and points out one of the trade-offs: because of those screens, ETHI owns fewer companies than some broader global ETFs. That doesn’t automatically make it better or worse. It just means you need to understand what you’re giving up and what you’re paying for.
At 0.59%, ETHI has the highest management fee on the list. That’s quite a jump from some of the low-cost index ETFs here, so if you’re considering an ETF with a more specialised strategy, it’s worth understanding exactly what the extra fee gets you.
7. A200 — BetaShares Australia 200 ETF
A200 tracks the 200 largest companies listed on the ASX by market capitalisation. In other words, the names are probably pretty familiar: CommBank. NAB. BHP. ANZ.
Nick likes A200 as an ETF to research partly because it gives investors a very tangible way to understand what it means to own shares. You see these companies everywhere. You probably use their products or services. And if you own the ETF, you own a small slice of them.
It’s also a useful ETF to compare with something like ETHI, because the underlying holdings can look dramatically different despite both being large-company funds.
A200 has a management fee of 0.04%.
6. DHHF — BetaShares Diversified All Growth ETF
DHHF is one of the list’s all-in-one options. It gives investors exposure to a diversified portfolio of shares across Australian and international markets. The appeal is fairly straightforward: instead of buying several ETFs to build a diversified portfolio, you can buy one fund that does the mixing for you.
Ana holds DHHF herself. She and her partner actually use it alongside another ETF because they couldn’t agree on exactly how they wanted to structure their debt recycling investments. It’s a good reminder that there isn’t always a single “correct” portfolio; sometimes you just settle on something that works for you.
DHHF has a management fee of 0.19%. One practical detail is worth knowing, too: DHHF defaults to a dividend reinvestment plan. That means distributions are automatically reinvested unless you opt out through the share registry.
5. NDQ — BetaShares NASDAQ 100 ETF
NDQ is where the list gets considerably more concentrated. It tracks the 100 largest non-financial companies listed on the Nasdaq, which means plenty of exposure to the big US technology companies that have been driving so much of the market conversation. It has also performed strongly in recent years, gaining around 19% over five years in the episode’s discussion.
But Nick is quick to put that number in perspective: past performance isn’t a crystal ball. If an ETF has benefited from a particular sector or market doing exceptionally well, that doesn’t mean the same thing will happen over the next five years. And NDQ is particularly exposed to that risk. If US tech takes a serious downturn, you’re likely to feel it more here than you would in a broadly diversified ETF.
Nick actually owns NDQ himself. He’s comfortable with the volatility because he deliberately uses it to tilt his portfolio towards technology. That distinction is important: a concentrated ETF can make sense if you know why you own it.
NDQ has a management fee of 0.48%.
4. VDHG — Vanguard Diversified High Growth Index ETF
VDHG is another all-in-one option, built from a collection of underlying Vanguard funds. It has exposure to Australian and international assets, as well as an allocation to fixed income.
That makes it slightly different from DHHF, which is entirely focused on growth assets. The two have become something of a friendly rivalry within the Pearler community, with investors often debating which one is better.
Nick’s answer is refreshingly uncontroversial: both do what they’re designed to do. There are differences in fees, holdings and asset allocation, so it’s worth understanding them. But neither is some catastrophic choice that investors need to lose sleep over.
VDHG’s management fee is 0.27%.
3. VGS — Vanguard International Shares ETF
VGS gives investors exposure to developed markets around the world. The fund covers multiple countries, including the US, Japan, the UK, Canada, France and Switzerland.
There is one fairly important detail hiding in that description, though: most of VGS is US exposure. So while “international shares” might sound like a way of getting away from the US-heavy nature of many portfolios, VGS is still substantially exposed to America.
That doesn’t make it a bad thing. It’s simply something worth knowing before you buy it. Nick describes VGS as a relatively simple way to get exposure to major global markets in one ETF.
The management fee is 0.18%.
2. IVV — iShares S&P 500 ETF
At number two is IVV, which tracks the 500 largest US companies by market capitalisation. It’s one of those ETFs that comes up constantly in investing conversations, and for good reason: it provides broad exposure to some of the biggest companies in the US for a very low fee. IVV’s management fee is just 0.04%. Nick holds it himself, alongside NDQ and VEU.
And that brings up another useful point from the episode: asset overlap isn’t necessarily a problem. IVV and NDQ have plenty of companies in common, but Nick deliberately holds both because he wants his portfolio to have a little more exposure to technology. That won’t be the right approach for everyone. But you don’t necessarily need to eliminate every bit of overlap from your portfolio either.
1. VAS — Vanguard Australian Shares Index ETF
And at number one, once again, is VAS. In fact, VAS has been number one since Pearler started compiling the list. It tracks the large Australian companies and listed property trusts on the ASX and has a management fee of 0.07%.
Its continued popularity is interesting given how much attention investors currently give to US markets and technology. Australian investors still seem pretty keen to own a piece of the companies they see around them every day.
There’s also an interesting comparison between VAS and A200. VAS tracks around 300 companies, while A200 tracks 200. But because the biggest companies make up such a large proportion of the Australian market, the two funds end up looking remarkably similar in terms of their overall exposure.
So if you’re agonising over VAS versus A200, Nick’s advice is essentially: don’t lose sleep over it. If two ETFs are genuinely very similar, choose the one you’re comfortable holding. That might come down to a slightly cheaper fee, a preferred fund manager or simply which one you like.
And if a cheaper option comes along later? You can always change your mind.
The top 10 ETF pairings
The individual rankings are only half the story. Pearler also looks at which ETFs investors most commonly hold together.
The top pairings are:
- VAS + VGS
- IVV + VAS
- IVV + VGS
- IVV + NDQ
- NDQ + VGS
- NDQ + VAS
- A200 + IVV
- VAS + VEU
- VAS + VTS
- VEU + VTS
What’s interesting is how few basic portfolio structures sit underneath all those combinations. Nick breaks them into three broad groups:
- There are investors holding Australia plus the world.
- There are investors holding the world with an extra tilt towards the US.
- There’s also a smaller group that is happy being 100% US-focused.
That’s really it. You can make the ETF combinations look complicated, but underneath them are some fairly simple decisions about geography and diversification.
Don’t get too hung up on the ticker
Perhaps the most useful part of the episode isn’t actually one of the ETFs, but the reminder that the name of an ETF only tells you so much.
If you’re comparing two funds, Nick suggests going one layer deeper and looking at the top 10 or 20 holdings. That can tell you a lot about what you’re actually buying, and can sometimes reveal that two ETFs you thought were completely different have quite a bit in common.
The same goes for performance. It’s very tempting to look at an ETF that has returned 19% over five years and decide that it must be the better investment. But that’s hindsight talking. The fund that has done best recently may not be the fund that does best from here. As Nick puts it, the temptation to chase recent performance is simply part of being human.
Instead, look at what the ETF actually holds, how diversified it is, what it costs and how it fits with the rest of your portfolio.
What the Pearler community’s portfolios have in common
The other striking thing about this year’s list is how little it has changed. VAS remains at number one, many of the same broad-market ETFs continue to dominate, and the most popular combinations tend to be relatively simple, low-cost and diversified.
That doesn’t mean you should copy the community, but it does give you a useful place to start. If you’re new to ETFs and have no idea whether you want Australian shares, US shares, global shares or an all-in-one option, seeing what other investors are actually holding can make the research process feel a little less overwhelming.
Just remember: popular doesn’t mean right for you. The best ETF is the one that fits your own goals, risk tolerance and portfolio, not necessarily the one sitting at number one on someone else’s list.
Listen to the full episode
Want to hear Nick and Ana unpack the top 10, including their own portfolios, ETF overlap and the most popular pairings? Listen to the full episode here.
And if you’re researching ETFs yourself, check out Pearler’s Compare tool to dig into how different funds stack up.
Happy investing!
Tash and Ana
