Vanguard’s Australian Shares Index ETF surpassed $20 billion in assets at the end of May, growing 34 per cent over the year from $14.9 billion and becoming the largest exchange-traded fund (ETF) in Australia.
The size is almost double the second-largest ETF which is the $11 billion Vanguard MSCI Index International Shares ETF.
The success of Vanguard means it now represents 27.3 per cent of the Australian ETF industry with $74.6 billion in funds under management and 31 ETFs available.
Looking at flows year-to-date, Vanguard has seen flows of $6.2 billion which represents 32 per cent of all total ETF flows.
This sum is 181 per cent higher than its flows at this point in 2024 when they stood at $2.2 billion and put Vanguard in third place behind Betashares and iShares.
Betashares, which held the top position this time last year with 28 per cent of total flows, dropped into second position with YTD flows of $5.3 billion, up 120 per cent from flows of $2.4 billion in May 2024.
Last year’s second place provider, iShares, saw only a moderate rise in comparison to the two leaders with growth of $2.9 billion or 31 per cent.
Looking at total funds under management, Vanguard has a 27.3 per cent market share, Betashares has an 18.8 per cent share with $51.4 billion in funds under management, and iShares has $45.8 billion in funds under management, representing a 16.7 per cent market share.
This means the three-largest providers now account for almost two-thirds of the Australian ETF industry while fourth-largest firm VanEck has just 9.4 per cent market share.
Commenting on the growth of the Vanguard Australian Shares Index, managing director of Vanguard Australia, Daniel Shrimski, said: “The growth of VAS reflects the increasing confidence Australian investors have in index investing and the Vanguard approach.
“ETFs like VAS have democratised investing. They’ve made it possible for everyday Australians to build wealth in a simple, low-cost and effective way.
“The benefits of indexing – transparency, diversification, and low costs – are better understood now, but we’ve still got work to do.”
