Three ASX ETF providers currently dominate the ETF landscape in terms of funds under management.
Vanguard, Betashares and iShares account for more than 60% of the market.
Yesterday, iShares funds were under the microscope for their performance over the last 12 months.
Exploring the best performing funds can give great insight into sectors and themes that are capturing returns.
Today, let's look at the best performing ASX ETFs in the last year from the largest ETF provider – Vanguard.
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Vanguard FTSE Asia Ex-Japan Shares Index ETF (ASX: VAE)
An emerging theme over the last 12 months has been the outperformance of Asian markets and equities.
This fund has increased over the last 12 months mainly because Asian markets rebounded, led by strong gains in Chinese technology stocks, Indian companies, and semiconductor firms such as Taiwan Semiconductor Manufacturing (NYSE: TSM), which benefited from the AI boom.
Improving confidence in China's economy, strong growth in India, and a weaker Australian dollar also boosted returns for Australian investors.
These tailwinds have pushed this fund 26% higher over the last 12 months.
This fund includes roughly 1,400 companies from 12 markets across Asia, excluding Japan. The key markets of China, Taiwan, Korea, and India make up around 80% of the exposure.
Vanguard MSCI Index International Shares (Hedged) ETF (ASX: VGAD)
Another strong performing fund over the last year has been this internationally focussed ETF.
The ETF provides exposure to many of the world's companies listed on the exchanges of major developed economies around the world.
At the time of writing, it includes over 1,200 underlying holdings, with its largest geographic exposure being to:
- United States: 73.1%
- Japan: 5.8%
- United Kingdom: 3.7%.
Because of its US dominant structure, it holds a large weighting towards technology and financial shares.
This could make it an ideal compliment for an investor looking to diversify away from Australian markets.
In the last 12 months, it has risen 18%.
Vanguard Australian Shares High Yield ETF (ASX: VHY)
This high yield ASX ETF has also been a great investment over the last year.
It provides exposure to companies listed on the Australian Securities Exchange that have higher forecast dividends relative to other ASX-listed companies.
Security diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% for any one company. Australian Real Estate Investment Trusts (A-REITS) are excluded from the index.
Over the last 12 months, it has not only provided strong dividends, but has also risen by 12% as well.
