VAS vs A200 — which is better?

Both are almost identical in practice. VAS tracks the ASX 300 (MER 0.07%) while A200 tracks the ASX 200 (MER 0.04%). The 0.03% fee difference seems tiny but compounds to thousands of dollars over 20+ years. Performance has been nearly identical historically since small-cap stocks (ASX 201–300) don't move the needle much. Most investors choose A200 purely for the lower cost. Either is an excellent core Australian holding.

VGS vs IVV — which should I choose for global exposure?

IVV gives you pure US exposure (S&P 500, 500 companies, MER 0.03%). VGS gives you broader global developed-market exposure including Europe and Japan alongside the US (MSCI World ex Australia, ~1,500 companies, MER 0.18%). If you believe in US exceptionalism and want the lowest cost, IVV. If you want more geographic diversification with still-strong US exposure (~70%), VGS is the better fit.

Is there a home bias problem for Australian investors?

Yes. Many Australians hold 60–80% of their equity portfolio in ASX stocks even though Australia represents only ~2% of global market capitalisation. The ASX is heavily concentrated in financials (banks) and materials (miners) — you're missing the bulk of the world's largest technology, healthcare, and consumer companies. Pairing an ASX ETF (VAS or A200) with a global ETF (VGS or IVV) is a common way to reduce home bias while keeping franking credit exposure.

Do Australian ETFs have franking credits?

Yes — Australian share ETFs like VAS, A200, and VHY pass through franking credits from the dividends they receive from ASX-listed companies. These credits can reduce or eliminate your tax on distributions (or generate a refund if you're in a lower tax bracket). Global ETFs like VGS, IVV, and NDQ do not carry franking credits since the underlying companies are foreign-listed.

Should I choose NDQ if it has the best returns?

Past returns don't guarantee future performance. NDQ's 19%+ 5-year return is exceptional but reflects the extraordinary run of US mega-cap technology. NDQ is concentrated in 100 stocks, heavily weighted to Apple, Microsoft, and Nvidia. A correction in tech would hit NDQ much harder than a diversified ETF like VGS or VDHG. It suits investors with a high risk tolerance and long time horizon who understand the concentration risk.

How do I buy these ETFs from Australia?

All seven ETFs (VAS, A200, VGS, IVV, NDQ, VDHG, VHY) are ASX-listed and available through any ASX broker. On Stake, they're available via the ASX product at A$3 flat per trade with CHESS sponsorship and no FX fee. Just search the ticker in the app during ASX trading hours (10am–4pm AEST).

What is management expense ratio (MER) and why does it matter?

MER is the annual fee charged by the ETF provider as a percentage of your investment — deducted automatically from the fund's assets. A 0.03% MER on a $50,000 investment costs $15/year; a 0.48% MER costs $240/year. Over 20 years with compounding, the difference between a 0.03% and 0.48% MER can amount to tens of thousands of dollars. MER is one of the strongest predictors of long-term ETF performance.

Updated August 2026 · Written by Jayme

Best Australian ETFs 2026

VAS vs A200 vs VGS vs NDQ vs IVV vs VDHG vs VHY — fees, 5-year returns, holdings concentration, franking credits, and which suits each investor type.

Not financial advice. MER and performance data sourced from Vanguard, BetaShares, and iShares fund fact sheets as at August 2026. Verify with each provider before investing.

Key takeaways

·VAS (0.07%) and A200 (0.04%) are both excellent for Australian equity exposure — A200 wins on cost, difference in returns is negligible.
·VGS has outperformed VAS by ~6% p.a. over 5 years due to global tech — but past performance doesn't predict future returns.
·NDQ delivered ~19% p.a. over 5 years — the strongest return but with concentrated tech sector risk.
·IVV offers S&P 500 exposure at just 0.03% MER — the cheapest mainstream ETF on the ASX.
·Australians are typically over-exposed to the ASX (2% of global market cap). Pairing AU + global ETFs reduces home bias.
·Australian ETFs (VAS, A200, VHY) pass through franking credits; global ETFs (VGS, IVV, NDQ) do not.
·All 7 ETFs are available on Stake at A$3 flat per trade, CHESS-sponsored, no FX fee.

Why ETFs? The case for index investing

Exchange-traded funds (ETFs) allow you to buy a basket of hundreds or thousands of stocks in a single trade. Instead of picking individual companies, you track a market index — capturing broad market returns at a fraction of the cost of active management.

Decades of research consistently shows that most active fund managers fail to outperform their benchmark index after fees. Low-cost index ETFs typically outperform the majority of active funds over 10+ year periods — which is why they've become the default investment vehicle for long-term Australian investors.

The compounding impact of MER: A 0.48% MER vs a 0.03% MER on a $100,000 investment over 20 years at 10% annual growth results in an ending balance roughly $55,000–$65,000 lower — purely from the fee drag. That's why the cheapest ETF tracking a given index is almost always the better choice.

ETF comparison at a glance

All 7 ETFs side by side. Data sourced from fund fact sheets, August 2026.

Ticker	Index tracked	MER p.a.	Exposure	Div. yield	5yr return*	Franking
VAS	S&P/ASX 300	0.07%	Australian	~4.3%	~8.2% p.a.	✓ Yes
A200	S&P/ASX 200	0.04%	Australian	~4.2%	~8.1% p.a.	✓ Yes
VGS	MSCI World ex Australia	0.18%	Global (ex-AU)	~1.6%	~14.1% p.a.	✗ No
IVV	S&P 500	0.03%	US	~1.3%	~15.8% p.a.	✗ No
NDQ	NASDAQ 100	0.48%	US (Tech-heavy)	~0.6%	~19.4% p.a.	✗ No
VDHG	Multiple indices (diversified)	0.27%	Global (diversified)	~2.1%	~10.7% p.a.	✓ Yes
VHY	FTSE Australia High Dividend Yield Index	0.25%	Australian (income focus)	~5.8%	~7.1% p.a.	✓ Yes

* Approximate 5-year annualised total return (distributions reinvested, AUD) to June 2026. Source: fund provider fact sheets and Morningstar. Past performance is not indicative of future returns.

ETF deep dives

Click any ETF to expand the full breakdown — top 5 holdings, who it suits, and a verdict.

The home bias problem — and how to fix it

Australia represents roughly 2% of total global stock market capitalisation — yet many Australian investors hold 60–80% of their equity portfolio in ASX stocks. This is called home bias, and it costs Australian investors dearly over long periods.

ASX vs global markets — 20-year performance (annualised, AUD)

S&P 500 (IVV/US)

Includes US tech boom, AUD depreciation tailwind

~13.1% p.a.

MSCI World ex-AU (VGS)

Broad global developed markets

~10.8% p.a.

ASX 300 (VAS)

Strong franking credits, but lower capital growth

~8.4% p.a.

NASDAQ 100 (NDQ)

Tech-dominated — high return, high volatility

~16.2% p.a.

Approximate long-run annualised total returns to June 2026 in AUD. Past performance does not predict future returns. Sources: Morningstar, fund provider fact sheets.

The ASX is dominated by financials (banks) and materials (miners). You have no meaningful exposure to the world's largest technology, healthcare, or consumer companies via ASX-only ETFs.

A simple fix: Most Australians benefit from pairing an Australian ETF (VAS or A200) with a global ETF (VGS or IVV). Common allocations range from 70% global / 30% Australian to 50/50 — the right split depends on your income needs (franking credits) and tax situation.

Note on franking credits: Australian ETFs pass through franking credits which reduce your tax liability. This benefit is real but is sometimes overstated — if you're in a higher tax bracket, the after-tax difference between Australian and global ETFs is narrower than the headline return gap. Consider your personal tax situation or consult a financial adviser.

How franking credits work in practice: VAS, A200, and VHY distributions often include franking credits attached to the Australian dividends they pass through. Depending on your marginal rate, these can reduce or even eliminate your tax on those distributions. See the franking credits guide for worked examples showing exactly how much you could save.

Which ETF suits you?

A decision guide by investor type. Not personal financial advice — these are illustrative scenarios.

The beginner investor

Starting out, wants simplicity, doesn't want to manage multiple funds.

Suggested picks

VDHG — one ETF, fully diversified globally, automatic rebalancing built in.

Higher MER (0.27%) is the tradeoff for full simplicity.

The cost-conscious long-term investor

Happy to manage 2–3 funds. Wants to minimise fees over decades.

Suggested picks

A200 for Australian shares (MER 0.04%)
IVV or VGS for global exposure (0.03–0.18%)

DIY two-fund portfolio. Slightly more admin (rebalancing) but meaningfully lower MER.

The income-focused investor

Retiree or near-retirement. Wants regular dividends and franking credits.

Suggested picks

VHY for high dividend yield + franking (MER 0.25%)
VAS for broader ASX exposure + franking (MER 0.07%)

VHY concentrates heavily in banks and miners — sector risk is higher.

The growth-oriented investor

Long time horizon. Comfortable with volatility. Wants the highest long-term growth potential.

Suggested picks

NDQ for tech-concentrated high growth (MER 0.48%)
IVV as a lower-volatility growth complement (MER 0.03%)

NDQ has delivered the highest returns but expect steep drawdowns in downturns.

The globally diversified investor

Wants to minimise home bias with broad global exposure plus some Australian anchor.

Suggested picks

VGS for broad global developed markets (MER 0.18%)
VAS or A200 as an Australian anchor for franking credits

Classic 'core and satellite' approach. Common 70/30 or 50/50 global/AU split.

How to buy these ETFs via Stake

All 7 ETFs are available on Stake at A$3 flat per trade, CHESS-sponsored, no FX fee.

Open a free account at hellostake.com — takes under 15 minutes with a driver's licence or passport. Use referral code jaymem884 to get a free US stock + $10 credit at sign-up.

Select the ASX product

Stake has two products: ASX (Australian shares + ETFs) and Wall Street (US stocks). All 7 ETFs in this guide are ASX-listed — make sure you're in the ASX section of the app.

Deposit AUD via PayID or BPAY

Transfer AUD from your bank account. No USD conversion needed for ASX ETFs — your AUD funds the ASX wallet directly.

Search by ticker and place your order

Search the exact ticker (VAS, A200, VGS, IVV, NDQ, VDHG, or VHY) during ASX market hours (10am–4pm AEST). Choose market order for immediate fill or limit order for a specific price. Brokerage is A$3 flat per trade up to A$30,000.

Units settle in T+2

Your ETF units appear in your portfolio after settlement (two business days after trade date). They're CHESS-sponsored under your HIN — the same as individual ASX shares.

No FX fee on ASX ETFs: VAS, A200, VGS, IVV, NDQ, VDHG, and VHY all trade in AUD on the ASX. The 0.55% FX fee on Stake only applies when converting AUD to USD for US stocks on the Wall Street product. ETF brokerage is A$3 flat — that's it.

Open Stake Free — Code jaymem884

Free account, free US stock + $10 credit. A$3 per ETF trade, CHESS-sponsored.

Also see: ETFs available on Stake

Looking specifically at which ETFs are available on Stake, the A$3 brokerage details, and how CHESS sponsorship works? See the Stake-specific ETF guide.

Best ETFs on Stake Australia 2026

Frequently asked questions

There's no single 'best' ETF — it depends on your goals. For Australian shares, VAS and A200 are the most popular choices. For global exposure, VGS is the most widely held. For pure US market exposure at the lowest cost, IVV (MER 0.03%) is hard to beat. For one-fund simplicity, VDHG covers everything. For growth with higher risk, NDQ has delivered the strongest returns over 5 years. These are not personal recommendations — consider your own circumstances.