Worst Performing ETFs Australia 2021

We’ve analysed the ETFs that produced disappointing results in 2021.

We analysed the worst performing ETFs in 2021 in terms of returns. This year, the worst ETF performers are from specialised products such as inverse ETFs, currencies and some precious metals.

Listed below are the worst performing five ETFs in Australia (in reverse order), and the reasons why they performed so poorly in the past year. 

Before you denounce these ETFs for good, remember that the performance of ETFs can change dramatically from year to year. This year’s worst performers can become next year’s best performers. This is why diversified investing is so important.

The worst Australian ETFs of 2021

5. BetaShares Euro ETF (ASX: EEU)

One year total return: -14.3%

Since the lows of March 2020, the Australian dollar has appreciated against global currencies such as the Euro, which has led to declines in the EEU. This is why betting on currency can be a risky endeavour. 

4. Perth Mint Gold (ASX: PMGOLD)

One year total return: -15.4%

Gold ETFs had exceptional returns in 2020 as share markets rose from the economic recovery. This year, they were in the bottom five, demonstrating the truism: last year’s winners can become this year’s losers. 

3. ETFS Physical Gold (ASX: GOLD)

One year total return: -15.9%

Similar to PMGOLD, the GOLD ETF fell by a bit more given it’s more expensive management fee. Despite the lower return, GOLD is still our preferred ETF for gold exposure.

2. BetaShares U.S Dollar ETF (ASX: USD)

One year total return: -18.9%

The large amount of monetary and fiscal stimulus put pressure on the USD. This, combined with an appreciating Australian dollar, meant that the USD ETF suffered. We may see further closures in currency ETFs given they are losing money, which has already started with ETF Securities closing their U.S. Dollar ETF (ASX: ZUSD). 

1. BetaShares Australian Equities Bear (Hedge Fund) (ASX: BEAR)

One year total return: -30.3%

The BetaShares Australian Equities Bear (Hedge Fund) (BEAR) was the worst performing ETF over the last year, down over 30%. It demonstrates how inverse ETFs are risky trading tools that can destroy wealth over the long term. Investors would have been better off hedging market risk using defensive assets instead.

Worst Performing Australian ETFs 2021

ASX CodeETF Name1 Year Total Return
BEARBetaShares Australian Equities Bear (Hedge Fund)-30.3%
USDBetaShares U.S Dollar ETF-18.9%
GOLDETFS Physical Gold-15.9%
PMGOLDPerth Mint Gold-15.4%
EEUBetaShares Euro ETF-14.3%
Source: ASX as of March 2021
If you want to find out which Australian ETFs investors flocked to in 2021 are, head straight to our 2021 ETF report – and make sure you know exactly what you’re investing in. 

Investment Manager

Marc has 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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