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Market Vectors re-brands to VanEck and launches two new ETFs

ETF Watch - Apr 21, 2016

Market Vectors has decided to adopt their parent brand VanEck for the branding of all of their ETFs, with the brand "Market Vectors Investments Limited" to now be known as "VanEck Investments Limited". From 2 May all funds will be known by their new name.

The below table shows the funds affected:

ASX Code Old Name New Name
MVA Market Vectors Australian Property ETF VanEck Vectors Australian Property ETF
MVB Market Vectors Australian Banks ETF VanEck Vectors Australian Banks ETF
MVE Market Vectors Australian Emerging Resources ETF VanEck Vectors Australian Emerging Resources ETF
MVR Market Vectors Australian Resources ETF VanEck Vectors Australian Resources ETF
MVS Market Vectors Small Cap Dividend Players ETF VanEck Vectors Small Cap Dividend Players ETF
MVW Market Vectors Australian Equal Weight ETF VanEck Vectors Australian Equal Weight ETF
QUAL Market Vectors MSCI World ex Australia Quality ETF VanEck Vectors MSCI World ex Australia Quality ETF

 

The ETF Watch Fund Database will soon be updated to reflect the new names of the funds.

Two new ETFs launched

More interesting to most will be the two new ETFs that are soon to be launched by VanEck:

  • IFRA - VanEck Vectors FTSE Global Infrastructure (Hedged) ETF
  • FDIV - Vaneck Vectors S&P/ASX Franked Dividend EFT

We take a look at each of the new listings below:

IFRA - VanEck Vectors FTSE Global Infrastructure (Hedged) ETF

This fund fills a gap in infrastructure ETFs, one that was highlighted in our low cost ETF portfolio post. Until now there have been no infrastructure ETFs available on the ASX. Given that infrastructure as a segment has some very unique characteristics, for an investor looking for diversity in their portfolio, it may well have its place. The fund will track the FTSE Developed Core Infrastructure 50/50 index, and be hedged to Australian dollars. Additional information about the index is available here. Management costs for the fund are 0.52% pa.

FDIV - VanEck Vectors S&P/ASX Franked Dividend ETF

This fund plays into a crowded space in Australia. With our obsession with dividends and our generous franking credit system, a number of dividend yield focused ETFs have popped up in recent years. We count 6 ETFs available on the ASX that focus on Dividend yield in the Australian market. The point of difference with this fund is a mandate to include only companies paying 100% franking credits on their dividends. Given this strict mandate, the pool of shares available for investment is much smaller, with the index that has been created to support this fund currently only comprising 30 companies. The weight of each sector is limited at 40% and the weight of any company is limited to 10%, presumably to ensure the index does not end up following 100% bank stocks.

When we analyse the 6 ETFs currently available on the ASX, of the 5 with 12 months or more history, the dividend yield ranges from 5.76% to 8.25% pa with a franked percentage of 54% - 69%. Assuming that this fund can keep its portfolio turnover low (and not realise capital gains), we'd expect to see a much higher franked percentage of dividends. As a result for an investor looking for an ETF with a desire for franked dividends, this may have its place in their portfolio, assuming they are comfortable with the added risk of a more concentrated portfolio. Management costs for this fund are 0.35% pa.

VanEck is yet to announce when these funds will be launched, but they'll be added to the ETF Watch fund database as soon as they are available.

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