VanEck today announced that Lonsec has upgraded its rating to ‘Recommended Index’ for its Australian Resources ETF (ASX code: MVR). The rating indicates that Lonsec has strong conviction that the ETF can generate risk adjusted returns in line with relevant objectives.
Lonsec has maintained ‘Recommended Index’ ratings for VanEck Vectors Australian Equal Weight ETF (MVW); VanEck Vectors Australian Property ETF (MVA) and VanEck Vectors Australian Banks ETF (MVB).
Arian Neiron, Managing Director VanEck Australia, said: “We are delighted to receive a ‘Recommended Index’ rating for MVR which provides investors with diversified exposure to Australian resources companies. A number of Australian resources companies have outperformed this year and as a result of MVR’s diversified approach, the ETF has returned 14.33% p.a. over the past 12 months and 22.17% over the past 6 months,” Mr Neiron said.
“MVR is a smart beta ETF which tracks the MVIS Australia Energy & Mining Index providing investors with exposure to the largest and most liquid ASX-listed companies from the Australian resources sector. The index employs a unique rules-based capping methodology allocating a maximum weighting of 8% to individual stocks removing the large capitalisation biases to companies such as BHP and Rio Tinto which dominate traditional market capitalisation indices,” Mr Neiron said.
Lonsec confirmed MVR’s “underlying index differs from the more widely used Australian equity resources indices primarily from its use of the capping factors, which are designed to improve diversification and prevent large companies from dominating the index. Lonsec believes the cap-weighted methodology of the underlying index potentially assists in reducing stock concentration risk.”
Mr Neiron said, “We have seen strong demand across our ETF range from investors seeking outperformance, income and capital growth. MVW, for example, has returned 19.03% p.a. over the past 12 months outperforming the S&P/ASX 200 Index by 9.63%, demonstrating that an equal weight approach to investing in Australian equities can significantly outperform compared to market capitalisation approaches.”
VanEck is one of the world’s largest ETF providers and in Australia it is a leading provider of smart beta ETFs. VanEck now has 12 ETFs listed on the ASX offering diverse exposures to a range of asset classes.F
| Fund |
ASX code | Features | Management Cost |
| VanEck Vectors Australian Resources ETF | MVR | • Based on the MVIS Australia Energy & Mining Index which tracks the largest and most liquid ASX-listed companies that generate at least 50% of their revenue or assets from the Australian resources sector.
• The index employs a unique cap-weighted methodology removing the large capitalisation biases to BHP and Rio Tinto inherent in traditional Australian based indices by capping the maximum weighting to individual stocks at 8%. • A minimum of 20 companies are tracked ensuring diversity. • All the benefits of ETFs including: · Simple trading on the ASX · Liquid · Transparent daily holdings · Cost effectiveness |
0.35% p.a. |
