Australian investors continue to funnel billions of dollars into some of the ASX's most popular exchange-traded funds (ETFs), with Vanguard ETFs and Betashares dominating many portfolios.
For investors building a portfolio for the long haul, these funds can provide a simple way to gain exposure to hundreds of companies. Vanguard Australian Shares Index ETF (ASX: VAS) and BetaShares Australia 200 ETF (ASX: A200) target the local market, while Vanguard MSCI Index International Shares ETF (ASX: VGS) and BetaShares Nasdaq 100 ETF (ASX: NDQ) give investors access to overseas markets.
But which funds have delivered the goods?
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VAS: the Australian market workhorse
The top Vanguard ETF offers exposure to the 300 largest companies listed on the ASX, providing investors with a straightforward way to own a slice of corporate Australia.
Its recent performance has been underwhelming, falling around 3% over the past month and 1% over 12 months. But short-term performance isn't necessarily the main attraction.
VAS provides broad exposure across Australian industries and a relatively attractive income stream. Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP) are among its largest holdings, each representing more than 10% of the portfolio.
The fund's dividend yield is around 3.7%, although investors should remember that Australian equities are heavily concentrated in financials and resources.
A200: low-cost Australian exposure
BetaShares Australia 200 ETF (ASX: A200) offers a similar proposition to the Vanguard ETF VAS, tracking the 200 largest Australian companies.
It has also struggled recently, down around 3% over the past month and 1% over 12 months.
Where A200 really stands out is cost. Its management fee is just 0.04%, while funds under management have climbed to around $11 billion.
Like VAS, its largest holdings include CBA and BHP, so investors face a similar concentration risk.
For a low-cost Australian core holding, however, A200 remains difficult to overlook.
VGS: taking the portfolio global
VGS tackles one of the biggest drawbacks of an Australia-only portfolio: concentration.
The Vanguard ETF provides exposure to developed international markets and has returned around 8% over the past year.
The US accounts for a significant portion of the portfolio, with technology heavyweights including Apple Inc (NASDAQ: AAPL) and Nvidia Corp (NASDAQ: NVDA) among its largest holdings, each representing more than 5% at the time of writing.
That international diversification opens the door to industries and companies that have a much smaller presence on the ASX.
NDQ: the growth bet
If A200 is the steady option, ASX: NDQ is the higher-octane alternative.
NDQ has gained around 11% over one year and an impressive 75% over five years, powered by its exposure to technology and other US growth companies.
Nvidia and Apple are among its biggest holdings, while the fund's 0.48% management fee is considerably higher than the 0.18% that Vanguard ETF VGS charges.
After such a powerful run, the question for investors is whether they're buying tomorrow's growth or yesterday's winners.
Foolish takeaway
There isn't one obvious winner. A200 has the cost advantage, VAS offers broad Australian exposure, VGS provides greater diversification, while NDQ has delivered the strongest growth.
For long-term investors, the better choice may depend less on picking a winner and more on combining complementary ETFs.
