Australia’s best-known ETFs track the ASX share market, giving investors diversified exposure to Australia’s largest companies in a single, low-cost trade. This article compares the major Australian share ETFs by cost, index, distribution approach, and what each is best suited for — without making specific buy or sell recommendations.
The Major Australian Share ETFs at a Glance
| ETF | Provider | Index | Holdings | MER | Distribution |
|---|---|---|---|---|---|
| A200 | BetaShares | Solactive Aus 200 | ~200 | 0.04% | Quarterly |
| IOZ | iShares | S&P/ASX 200 | ~200 | 0.05% | Quarterly |
| VAS | Vanguard | S&P/ASX 300 | ~300 | 0.07% | Quarterly |
| STW | SPDR | S&P/ASX 200 | ~200 | 0.13% | Quarterly |
| MVW | VanEck | Equal-weight ASX | ~80 | 0.35% | Half-yearly |
| VHY | Vanguard | ASX High Yield | ~70 | 0.25% | Quarterly |
| SYI | SPDR | S&P/ASX 200 yield | ~80 | 0.35% | Quarterly |
MERs accurate at time of publication (May 2026). Verify current fees with each provider.
Broad Market ETFs — The Core Options
A200, IOZ, VAS — All Track Similar Markets
These three ETFs are the most widely held Australian share ETFs. They all track the large-cap ASX market, pay quarterly distributions with franking credits, and differ primarily in:
- MER — A200 is cheapest (0.04%), followed by IOZ (0.05%), then VAS (0.07%)
- Holdings — VAS holds ~300 companies; A200 and IOZ hold ~200
- Provider — BetaShares, BlackRock, Vanguard respectively
For a detailed comparison, see VAS vs A200.
STW — Australia’s Oldest ETF
STW (SPDR S&P/ASX 200 ETF) was listed in 2001 — the first ETF on the ASX. Managed by State Street Global Advisors. Its 0.13% MER is higher than A200, IOZ, and VAS for the same market exposure. STW is still widely used by institutional investors due to its long history and deep liquidity, but for retail long-term investors, the lower-cost alternatives are generally more appropriate.
High-Yield ETFs
VHY — Vanguard Australian Shares High Yield ETF
VHY tracks an index of ASX companies selected for their dividend yield — approximately the 70 highest-yielding large ASX companies. It offers a higher income yield than broad-market ETFs but less diversification and different sector weights.
Trade-offs:
- Higher cash yield (typically 4.5–6%+ cash, well-franked)
- Less diversified — concentrated in banks, utilities, resources
- Higher MER (0.25%)
- Lower capital growth potential than the broader market in some periods
MVW — VanEck Australian Equal Weight ETF
MVW weights all holdings equally rather than by market capitalisation, giving smaller companies more influence. This reduces the dominance of CBA and BHP that characterises market-cap-weighted ETFs.
Trade-offs:
- Less concentration in the very largest companies
- Better small and mid-cap exposure within the ASX
- Higher MER (0.35%)
- Higher portfolio turnover (more frequent rebalancing to maintain equal weights)
Choosing Between Australian Share ETFs
| Investor goal | Consider |
|---|---|
| Lowest possible cost | A200 (0.04%) |
| Broad diversification, low cost | VAS (0.07%, 300 companies) |
| S&P/ASX 200 specifically | IOZ (0.05%) |
| Maximum dividend income | VHY (high yield, more franking) |
| Reduce large-cap concentration | MVW (equal weight) |
| Global portfolio via Vanguard | VAS + VGS combination |
Do Australian Share ETFs Provide Global Diversification?
No. Australian share ETFs only cover the Australian market — approximately 2% of world share market capitalisation. The ASX is heavily concentrated in financials and materials. For global diversification, Australian share ETFs need to be combined with international ETFs (VGS, BGBL, IVV) or a diversified all-in-one ETF (DHHF, VDHG).
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Frequently Asked Questions
Which Australian share ETF has the most franking credits? All broad-market Australian share ETFs (VAS, A200, IOZ) receive similar levels of franking credits — reflecting the franking profile of the ASX. VHY may receive higher franking credits per dollar invested because it specifically selects high-yielding, often fully franked companies (like the Big Four banks). However, the grossed-up yield comparison should factor in that VHY’s higher yield comes with less diversification.
Are there any sector-specific Australian ETFs? Yes. BetaShares, VanEck, and iShares offer sector-specific ETFs covering ASX financials, ASX resources, ASX healthcare, and other sectors. These carry higher concentration risk than broad-market ETFs and are generally not appropriate as a primary holding for most investors.
Is the ASX 200 a good measure of Australia’s share market? The ASX 200 captures approximately 80–85% of total ASX market capitalisation — it is a good representation of the Australian large-cap share market. The ASX 300 (tracked by VAS) adds another 100 smaller companies and captures approximately 88–90% of total market cap. Either index provides broad and representative Australian equity exposure.
This article provides general financial information only. ETF mentions are for educational context and are not a recommendation to buy or sell. Past performance is not a reliable indicator of future performance. For advice tailored to your situation, speak with a licensed financial adviser. You can find one through the ASIC financial advisers register or MoneySmart.