10 ASX ETFs for investors to watch

What are ETFs?

Exchange Traded Funds (ETFs) are an increasingly popular way for investors to gain exposure to a wide variety of investments at a relatively low cost.

ETFs generally hold a particular type of shares, bonds, commodities, currencies, cryptocurrencies or futures contracts and usually reflect the price movement of their holdings. This enables investors to get exposure to particular industries (such as a financial services ETF), an index (such as the ASX200 ETF), international markets (such as a Korean shares ETF), bonds (through a bond ETF), etc.

There are approximately 258 ETFs trading on the ASX through financial services providers such as BetaShares, BlackRock, ETFS Management (AUS) Limited, State Street Global Advisors, Australia Services Limited, VanEck Investments Limited and Vanguard Investments Australia Ltd.

Given their sector specificity, ETFs provide stock investors with a convenient means to wager on the outcomes of broader macroeconomic or geo-political developments, as opposed to honing down on particular stocks.

What are the best ETFs to watch?

2024 could provide investors with a diverse range of macroeconomic plays, as geopolitical turmoil in the Middle East and Eastern Europe creates both uncertainty and opportunities for markets. Analysts are anticipating an end to hawkish monetary policies in many economies, following long-standing runs of rate hikes that have helped to at least quell inflation.

The following ten ETFs could be very interesting options for investors as of the month of September 2024.

1. BetaShares NASDAQ 100 ETF (ASX: NDQ)

2. iShares S&P 500 ETF (ASX: IVV)

3. Vanguard Australian Shares Index ETF (ASX: VAS)

4. Vanguard MSCI Index International Shares ETF (ASX: VGS)

5. BetaShares Geared Australian Equity Fund (ASX: GEAR)

6. BetaShares Australian Equities Strong Bear Hedge Fund (ASX: BBOZ)

7. BetaShares Crypto Innovators ETF (ASX: CRYP)

8. Global X Physical Gold ETF (ASX: GOLD)

9. BetaShares U.S. Equities Strong Bear Hedge Fund (ASX: BBUS)

10. BetaShares Geared U.S. Equity Fund (ASX: GGUS)

BetaShares NASDAQ 100 ETF (ASX: NDQ)

The BetaShares NASDAQ 100 ETF provides targeted exposure to 100 of the largest non-financial companies on the NASDAQ – including tech giants like Apple, Microsoft, Amazon, and Alphabet. It offers Australian investors a straightforward way to access a diversified portfolio of the world’s most influential and innovative companies.

This ETF is ideal for those confident in the long-term growth of the technology sector, allowing for participation in the ongoing global innovation driven by these companies. With its diversified approach, NDQ mitigates the risks associated with investing in individual stocks, making it a strategic choice for capturing broader market trends while managing portfolio risk.

iShares S&P 500 ETF (ASX: IVV)

The iShares S&P 500 ETF offers broad exposure to 500 of the largest companies listed on US stock exchanges, including industry leaders like Apple, Microsoft, Amazon, and Johnson & Johnson. Designed to track the S&P 500 Index, this ETF is widely regarded as a reliable indicator of the overall health of the US economy.

IVV is a compelling option for those seeking to invest in a diversified portfolio that captures the growth potential of the largest US companies across various sectors, such as technology, healthcare, and consumer goods. With its focus on well-established, blue-chip companies, this ETF is well-suited for those aiming for long-term capital growth and stability. The iShares S&P 500 ETF is a strategic choice for benefiting from broader trends in the US economy while effectively managing risk through diversification.

Vanguard Australian Shares Index ETF (ASX: VAS)

The Vanguard Australian Shares Index is a highly regarded ETF that offers diversified exposure to the largest companies on the Australian Securities Exchange (ASX), including key players like Commonwealth Bank, BHP, and CSL. By tracking the S&P/ASX 300 Index, this ETF provides a comprehensive snapshot of the Australian equity market.

VAS is particularly attractive to those looking to harness the growth potential of Australia’s top companies across sectors such as financials, materials, and healthcare. With a focus on blue-chip Australian stocks, it provides a solid foundation for long-term capital growth and income, particularly through dividends, a notable feature of the Australian market. The Vanguard Australian Shares Index ETF is an excellent choice for those seeking to establish a core holding in Australian equities, offering broad market exposure and the advantages of diversification.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

The Vanguard MSCI Index International Shares ETF delivers diversified exposure to over 1,500 of the world’s largest companies across developed markets, including global giants like Apple, Microsoft, Nestlé, and Toyota. By tracking the MSCI World ex-Australia Index, this ETF provides a broad representation of international equities outside of Australia.

VGS is an appealing option for those looking to diversify their portfolios on a global scale, capturing the growth potential of leading companies across various sectors and regions, including North America, Europe, and Asia. It is particularly well-suited for those seeking long-term capital growth while managing risk through exposure to a wide range of industries and countries. The Vanguard MSCI Index International Shares ETF is a strategic choice for those wanting to complement their Australian investments with international exposure, offering a balanced approach to global investing.

BetaShares Geared Australian Equity Fund (ASX: GEAR)

The BetaShares Geared Australian Equity Fund is an ETF offering leveraged exposure to a diversified portfolio of Australian equities, including top companies like Commonwealth Bank, BHP, and CSL. GEAR seeks to deliver approximately double the daily performance of the Australian share market, as measured by the S&P/ASX 200 Index, through the use of gearing (leverage).

This fund is targeted at investors with a higher risk tolerance who are looking to amplify their returns in the Australian equity market. While leverage can significantly boost gains in rising markets, it also increases the potential for losses during downturns, making GEAR more suitable for those with a deep understanding of market risks. The BetaShares Geared Australian Equity Fund is a strategic choice for investors aiming for aggressive growth in the Australian market by leveraging the performance of leading companies.

BetaShares Australian Equities Strong Bear Hedge Fund (ASX: BBOZ)

The BetaShares Australian Equities Strong Bear Hedge Fund is an actively managed fund offering leveraged exposure to the downside of the Australian share market. It aims to deliver returns that are negatively correlated with the daily movements of the S&P/ASX 200 Index, providing magnified gains when the market declines and amplified losses when it rises.

BBOZ is particularly suited for investors looking to hedge against potential market downturns or those wanting to speculate on a falling Australian equity market. With its leveraged inverse exposure, this fund is a powerful tool for managing risk in volatile conditions or for short-term trading strategies. However, given its leveraged nature, BBOZ is best suited for experienced investors who understand the risks associated with short-term market movements and are prepared for the potential volatility in their investments.

BetaShares Crypto Innovators ETF (ASX: CRYP)

The BetaShares Crypto Innovators ETF provides exposure to a portfolio of global companies involved in the cryptocurrency industry, including those in cryptocurrency exchanges, mining, blockchain technology, and related services. It tracks the Bitwise Crypto Innovators Index, designed to capture the growth potential of the rapidly evolving digital asset ecosystem.

CRYP is an attractive option for investors seeking indirect exposure to the cryptocurrency market without directly investing in digital assets like Bitcoin or Ethereum. By focusing on companies driving innovation in the crypto space, this ETF allows investors to benefit from the broader adoption and growth of blockchain technology and cryptocurrencies.

It is particularly well-suited for those bullish on the long-term prospects of the crypto industry and looking to diversify their portfolios with exposure to this emerging sector. However, due to the speculative nature of the cryptocurrency market, CRYP may exhibit greater volatility than traditional equity ETFs.

Global X Physical Gold ETF (ASX: GOLD)

The Global X Physical Gold ETF offers direct exposure to gold by holding physical gold bullion, closely tracking the metal’s price. This ETF allows investors to gain exposure to gold without the need to purchase or store it themselves, with each unit representing a portion of the gold securely stored in vaults.

GOLD is particularly appealing to those seeking a safe-haven asset to diversify their portfolios, especially during periods of market uncertainty or inflation. As gold has long been considered a store of value and a hedge against economic instability, this ETF provides a reliable option for protecting wealth from volatility in equity and currency markets.

The Global X Physical Gold ETF offers a convenient and cost-effective way to invest in gold, combining the liquidity of an ETF with the security of physical ownership.

BetaShares U.S. Equities Strong Bear Hedge Fund (ASX: BBUS)

The BetaShares U.S. Equities Strong Bear Hedge Fund is an actively managed fund offering leveraged exposure to the downside of the U.S. share market, specifically targeting the S&P 500 Index, while hedging against currency risk between the Australian dollar (AUD) and the U.S. dollar (USD).

The fund aims to deliver returns that are negatively correlated with the U.S. equity market, generating positive returns when the S&P 500 declines, and vice versa.

BBUS is particularly appealing to those looking to hedge their portfolios against potential declines in the U.S. stock market or to profit from a bearish outlook on U.S. equities. The currency hedging feature is especially beneficial for Australian investors, as it neutralises the impact of AUD/USD exchange rate fluctuations, allowing a focus on U.S. market performance.

Due to its leveraged nature, BBUS is best suited for experienced investors who understand the risks of short-term trading and are prepared for the potential volatility associated with leveraged investments.

BetaShares Geared U.S. Equity Fund - Currency Hedged (ASX: GGUS)

The BetaShares Geared U.S. Equity Fund is an actively managed fund offering leveraged exposure to U.S. equities, specifically those in the S&P 500 Index, while also hedging against currency risk between the Australian dollar (AUD) and the U.S. dollar (USD). By using gearing (borrowing), the fund aims to amplify returns, delivering magnified gains when the U.S. stock market rises but also magnified losses when it declines.

GGUS is particularly appealing to investors with a bullish outlook on the U.S. equity market who seek to enhance their potential returns through leveraged exposure. The fund’s currency hedging is advantageous for Australian investors, as it mitigates the impact of AUD/USD exchange rate fluctuations, ensuring that returns reflect the performance of the underlying U.S. equities.

However, due to its leveraged structure, GGUS carries higher risk and volatility, making it more suitable for experienced investors comfortable with the potential for significant gains or losses.

How can investors trade in ASX-listed ETFs

Take your position on over 13,000 local and international shares via CFDs or share trading – all at your fingertips on our award-winning platform.* Learn more about share CFDs or shares trading with us, or open an account to get started today.

* Winner of 'Best Multi-Platform Provider' at ADVFN International Finance Awards 2022.