One of the most popular internationally focused exchange-traded funds (ETFs) on the ASX is the BetaShares NASDAQ 100 ETF (ASX: NDQ). Investors love this ETF for the unique exposure to the largest tech stocks that it gives ASX investors.
But perhaps it won't be so unique going forward. The BetaShares NASDAQ 100 ETF is the only fund on the ASX right now that tracks the 100 largest shares on the United States' NASDAQ stock exchange, excluding financials shares.
The NASDAQ is home to almost all of the US's major tech shares. It is dominated by the entire 'magnificent seven', consisting of Apple, Microsoft, Amazon, Alphabet, Meta Platforms, Tesla and NVIDIA. But it also houses tech shares ranging from Atlassian and Netflix to Paypal and Airbnb.
With names like that at the top of this ETF's portfolio, it's not hard to see why NDQ appeals to ASX investors.
But the BetaShares NASDAQ 100 ETF is no longer enjoying a monopoly on the ASX door to the NASDAQ.
New ASX ETF arrives to challenge NDQ's dominance
Global X ETFs has just launched a rival NASDAQ ETF in the Global X US 100 ETF (ASX: N100).
This new fund appears to function in the exact same manner as the BetaShares NDQ ETF.
Both hold the largest 100 non-financial shares of the NASDAQ exchange. Both hold the same top holdings dominated by the magnificent seven. That's despite the BetaShares NASDAQ ETF unambiguously tracking the NASDAQ 100 index itself, while the Global X ETF tracks its proprietary 'Global X US 100 Index'.
N100 units began trading yesterday and floated on the ASX for $10 each. Today, those units are currently trading for $10.13 each at the time of writing, up 1.5% so far.
Because these ETFs are so similar in scope and appear to track the same index, the only real thing that we can use to separate them today is the management fee. All ETFs charge their investors management fees, which are deducted from the fund to pay for its upkeep.
The BetaShares NASDAQ 100 ETF currently charges a management fee of 0.48% per annum – a figure that hasn't moved for a few years.
The Global X US 100 ETF undercuts that fee, charging 0.24% per annum.
It will be interesting to see how these two ETFs attract NASDAQ-seeking ASX investors going forward.
A previous version of this article incorrectly stated the Global X US 100 ETF management fee as 0.25%. This has since been amended to the accurate 0.24% management fee.
