Is VAP a good ETF?
VAP is the Vanguard Australian Property Securities Index ETF from Vanguard. It tracks the S&P/ASX 300 A-REIT Index. We classify it under AU, Thematic, and Market-Cap. With about $3.02 billion in assets it is a large, highly liquid fund. Listed on the ASX since 2010-10-15 (almost 16 years ago).
On a total-return basis, VAP has delivered 5.24% a year over 10 years (ranked 76th of 108 ETFs we track), 5.32% a year over 5 years (ranked 119th of 188 ETFs we track), 9.7% a year over 3 years (ranked 121st of 226 ETFs we track), and -5.23% a year over 1 year (ranked 283rd of 308 ETFs we track). It has trailed most comparable ETFs over the periods we measure, so look closely at whether its strategy fits what you're after.
The management fee of 0.22% is reasonable. That's cheaper than the typical 0.36% for similar ETFs. If cost is your priority, SLF (0.16%), DJRE (0.2%), and REIT (0.2%) cover similar ground for less. It pays a moderate 2.92% yield.
Over the past 10 years its volatility has been elevated (annualised standard deviation around 21.02%), meaning noticeably larger swings than the broad market. Its 10-year Sharpe ratio of 0.25 is weak — that's the return it has earned per unit of risk taken (higher is better).
Portfolio turnover is very low at about 8% a year — the portfolio barely changes from year to year, much like a classic buy-and-hold index fund. Very little of its return is lost to trading or to capital gains being realised early, making it highly tax-efficient.
Strengths
- Low-cost: a 0.22% management fee keeps more of the return in your pocket.
Things to watch
- Has lagged most peers over 1 year (283rd of 308).
- Cheaper alternatives exist: SLF, DJRE, and REIT.
- Weak risk-adjusted returns (10-year Sharpe ratio 0.25).
- Highly concentrated single-theme bet — keep the position size small.
Good to know
- Distributions are 20% franked, a tax bonus for Australian residents.
- Australian focus means franked dividends and no currency risk, but heavy concentration in banks and miners.
What VAP's categories mean for you
How each category this ETF belongs to tends to behave across market cycles.
Australian shares. Home-market familiarity, fully franked dividends and no currency risk for local investors — but very concentrated in banks and miners, which dominate the index.
- Market regime
- Sensitive to commodity prices, Chinese demand and domestic interest rates. Generous income, but narrow sector diversification.
- In a portfolio
- A natural core for Australian investors thanks to franking, but should be paired with global exposure so you aren't over-reliant on a handful of banks and resource giants.
A concentrated bet on a single trend — AI, battery tech, cybersecurity, robotics and the like. High conviction, high concentration, and often high fees.
- Market regime
- Frequently launched after a theme is already hot, which has historically been a poor entry point. Expect very large swings in both directions.
- In a portfolio
- A small satellite position at most. Treat it as a speculative tilt, never as a core holding.
Holdings are weighted by company size, so the largest companies carry the most weight. These funds are cheap, tax-efficient and self-rebalancing.
- Market regime
- Works in almost any regime as a low-maintenance core. The trade-off is concentration — you automatically own more of whatever has already become expensive at the top of a bull market.
- In a portfolio
- The classic buy-and-hold core of most portfolios. Well suited to long-term, hands-off investing.
General information only, generated from the fund's published data — not personal financial advice. Past performance is not a reliable indicator of future returns. Consider your own circumstances or seek licensed advice before investing.