Is VGE a good ETF?
VGE is the Vanguard FTSE Emerging Markets Shares ETF from Vanguard. It tracks the FTSE Emerging Markets All Cap China A Inclusion Index. We classify it under EM and Market-Cap. With about $2 billion in assets it is a large, highly liquid fund. Listed on the ASX since 2013-11-18 (almost 13 years ago).
On a total-return basis, VGE has delivered 7.74% a year over 10 years (ranked 65th of 108 ETFs we track), 6.13% a year over 5 years (ranked 105th of 188 ETFs we track), 11.77% a year over 3 years (ranked 95th of 226 ETFs we track), and 10.04% a year over 1 year (ranked 129th of 308 ETFs we track).
The management fee of 0.48% is on the higher side. For comparison, similar ETFs average around 0.28%. If cost is your priority, VEU (0.04%), VAE (0.4%), and AVTE (0.45%) cover similar ground for less. It pays a moderate 1.77% yield.
Over the past 10 years its volatility has been moderate (annualised standard deviation around 10.3%), meaning the kind of swings you'd expect from a diversified equity fund. Its 10-year Sharpe ratio of 0.56 is reasonable — that's the return it has earned per unit of risk taken (higher is better).
Portfolio turnover is low at about 10% a year — it trades only a small slice of its holdings each year, so trading costs and tax on realised gains stay modest — typical of a passive index strategy.
Things to watch
- Pricier than similar ETFs, which average around 0.28%.
- Cheaper alternatives exist: VEU, VAE, and AVTE.
What VGE's categories mean for you
How each category this ETF belongs to tends to behave across market cycles.
Emerging markets — developing economies such as China, India, Brazil and Taiwan. High growth potential with materially higher volatility, currency and political risk.
- Market regime
- Often trades at cheaper valuations than developed markets and performs well in global risk-on phases and when the US dollar is weak. Can endure long stretches of underperformance.
- In a portfolio
- A satellite growth allocation for patient investors with a long horizon and tolerance for big swings.
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.