2019 ETF Research Report, Bond ETFs, ETF Performance Tables

ETF Performance Tables – Bonds, Fixed Income and Cash ETFs

Summary of all Bond, Fixed Income and Cash ETFs by Performance and Returns.

Overall Trends and Average Returns

Bonds and Cash ETFs delivered an average return of 5.3% over the past year. Australian Bonds ETFs returned 5.8%, outperforming Global Bond ETFs which returned 4.6% over the past year. Australian Government Bond ETFs were the top performing ETFs in the asset class, returning an average of 7.6% over the past year. Meanwhile Cash ETFs returned an average of 2.1%.

Best Performing Bond ETF

The best performing Bond ETF was the Russell Australian Government Bond ETF (RGB), which returned 8.9% over the past year.  

Worst Performing Bond ETF

The worst performing Bond ETF was the VanEck Vectors Australian Floating Rate ETF (FLOT) which returned 2.6% over the past year.

Largest Inflows/Outflows

The theme of the year was Bonds and Cash, and this translated into large net flows of $233m into the iShares Core Cash ETF (BILL). One of the most popular ETFs was the year and a half old BetaShares Active Australian Hybrids Fund (HBRD) with $195m in flows. Finally, demand for floating rate notes meant BetaShares Australian Bank Senior Floating Rate Bond ETF (QPON) saw $151m of flows, and now impressively has 400m in FUM.

Outflows were seen in the Vanguard International Credit Securities Index (Hedged) ETF (VCF) and iShares Global High Yield Bond (AUD Hedged) ETF which saw -$29m and -$1m respectively leaving the ETFs. Even though the UBS IQ Cash ETF(MONY) has only been around for 2 years, it has struggled to gain traction with just $200k of flows into the $1m sized ETF. We caution investors using ETFs with such low FUM levels as they are at risk of being closed due to commercial viability reasons. Click here to read more about our recommended tips for being a better ETF investor.

New Funds

Four new ETFs were launched in this sector. In particular we saw the arrival of 2 active strategies in the BetaShares Legg Mason Australian Bond Fund (Managed Fund) (BNDS) and the ActiveX Ardea Real Outcome Bond Fund (Managed Fund) (XARO).

BetaShares came out with an Investment Grade Bond ETF (CRED), and Vanguard launched the first ethical Global Bond ETF through the Vanguard Ethically Conscious Global Aggregate Bond Index (Hedged) ETF (VEFI). VEFI and XARO have struggled to get much uptake with $6m and $2m in FUM respectively.

Meanwhile, BNDS has amassed $50m in FUM while CRED has $146m in FUM – two very impressive figures given the infancy of the ETFs.

Stockspot’s Chosen ETF

Stockspots chosen Bond ETF, the iShares Core Composite Bond ETF (IAF) returned 7% over the past year. It was also one of ETFs with the highest inflows in this category with $160m in net flows over the year. You can find out why we chose IAF as our preferred ETF in this category in our Australian Bonds ETF Review.

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Bond, Fixed Income and Cash ETFs Performance Table

Australian Bonds (Diversified)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
IAFiShares Core Composite Bond ETF0.20%7181897.0%4.0%
BONDSPDR S&P/ASX Australian Bond Fund0.24%3397.0%3.9%
VAFVanguard MSCI Australian Large Companies Index ETF0.20%8791747.0%4.0%
Avg0.21%7.0%4.0%
Total1629373
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Australian Bonds (Government)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
GOVTSPDR S&P/ASX Australian Government Bond Fund0.22%1638.0%4.2%
IGBiShares Treasury ETF0.26%1311058.0%3.9%
RGBRussell Australian Government Bond ETF0.24%6888.9%
VGBVanguard Australian Government Bond Index ETF0.20%209717.5%3.9%
RSMRussell Australian Semi-Government Bond ETF0.26%6435.5%3.3%
Avg0.24%7.6%3.9%
Total488190

Australian Bonds (Corporate)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
CREDBetaShares Australian Investment Grade Bond ETF0.25%146146
RCBRussell Australian Select Corporate Bond ETF0.28%200415.4%3.5%
PLUSVanEck Vectors Australian Corporate Bond Plus ETF0.32%2891126.6%
VACFVanguard Australian Corporate Fixed Interest Index ETF0.26%199995.6%
Avg0.28%5.9%3.5%
Total834397

Australian Bonds (Other)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
ILBiShares Government Inflation ETF0.26%129195.4%3.0%
FLOTVanEck Vectors Australian Floating Rate ETF0.22%174932.6%
QPONBetaShares Australian Bank Senior Floating Rate Bond ETF0.22%4001533.2%
Avg0.23%3.7%3.0%
Total703265
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Australian Bonds (Active)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
BNDSBetaShares Active Australian Hybrids Fund0.55%2561955.0%
HBRDBetaShares Legg Mason Australian Bond Fund (Managed Fund)0.42%5050
Avg0.49%5.0%
Total306245

Global Bonds (Diversified and Government)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
VEFIVanguard Ethically Conscious Global Aggregate Bond Index (Hedged) ETF0.26%22
VBNDVanguard Global Aggregate Bond Index (Hedged) ETF0.20%55474.5%
VIFVanguard International Fixed Interest Index (Hedged) ETF0.20%263944.9%2.8%
Avg0.22%4.7%2.8%
Total320143
You can invest in global bond ETFs as part of our themes

Global Bonds (Other)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
IHCBiShares Core Global Corporate Bond (AUD Hedged) ETF0.26%122344.7%3.8%
VCFVanguard International Credit Securities Index (Hedged) ETF0.30%87-294.4%3.7%
IHEBiShares J.P.Morgan USD Emerging Markets Bond (AUD Hedged) ETF0.51%1523.3%5.5%
IHHYiShares Global High Yield Bond (AUD Hedged) ETF0.56%24-25.4%7.2%
Avg0.41%4.5%5.1%
Total2495

Global Bonds (Active)

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
XAROActiveX Ardea Real Outcome Bond Fund (Managed Fund)0.50%66

Cash

CodeFund NameFee (MER)FUM Mar’19 ($m)FUM change ($m)1 Yr Return3 Yr Return (p.a)
AAABetashares Australian High Interest Cash ETF0.18%13401062.0%2.1%
BILLiShares Core Cash ETF0.07%4032332.0%
ISECiShares Enhanced Cash ETF0.12%812562.2%
MONYUBS IQ Cash ETF0.18%10
Avg0.14%2.1%2.1%
Total1826396

Investment Associate

Marc has over 5 years experience in the financial services industry having previously worked for Morgan Stanley, AMP and KPMG. He holds a Bachelor of Business (Finance/Accounting) from the University of Technology Sydney (UTS), and has completed his Chartered Financial Analyst (CFA) Level 1.

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