Is VGAD a good ETF?
VGAD is the Vanguard MSCI Index International Shares (Hedged) ETF from Vanguard. It tracks the MSCI World ex Australia Index (AUD Hedged). We classify it under Intl, Large-Cap, and Market-Cap. With about $7.43 billion in assets it is a large, highly liquid fund. Listed on the ASX since 2014-11-20 (almost 12 years ago).
On a total-return basis, VGAD has delivered 12.41% a year over 10 years (ranked 26th of 108 ETFs we track), 10.88% a year over 5 years (ranked 45th of 188 ETFs we track), 17.52% a year over 3 years (ranked 42nd of 226 ETFs we track), and 19.89% a year over 1 year (ranked 48th of 308 ETFs we track). Its strongest showing is over 1 year, where it sits in the top 16% of all ETFs we track.
The management fee of 0.22% is reasonable. That's cheaper than the typical 0.48% for similar ETFs. If cost is your priority, BGBL (0.08%), IHVV (0.1%), and HGBL (0.11%) cover similar ground for less. It pays a moderate 2.42% yield.
Over the past 10 years its volatility has been moderate (annualised standard deviation around 14.04%), meaning the kind of swings you'd expect from a diversified equity fund. Its 10-year Sharpe ratio of 0.75 is reasonable — that's the return it has earned per unit of risk taken (higher is better).
Portfolio turnover is very low at about 5% 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
- Top-16% returns over 1 year (48th of 308 ETFs we track).
- Low-cost: a 0.22% management fee keeps more of the return in your pocket.
Things to watch
- Cheaper alternatives exist: BGBL, IHVV, and HGBL.
What VGAD's categories mean for you
How each category this ETF belongs to tends to behave across market cycles.
Global and international shares from outside Australia — broadening you into thousands of companies and the sectors (tech, healthcare) the local market lacks.
- Market regime
- Essential diversification away from the bank-and-resources-heavy ASX. Unhedged versions carry currency risk; hedged versions remove it at a small cost.
- In a portfolio
- A core holding for almost every long-term Australian portfolio.
The biggest, most established companies. More stable earnings, lower volatility and often steadier dividends than the broad market.
- Market regime
- Holds up comparatively well in downturns and uncertain markets; tends to lag small-caps and growth during the most aggressive bull runs.
- In a portfolio
- A dependable core building block suited to long-term 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.