Top 10 portfolio benchmarks used by Australian investors
Sharesight’s benchmarking feature is a great way to track your success by comparing your portfolio performance to a market, region or industry of your choice. This feature allows investors to benchmark their portfolio against more than 170,000 stocks, exchange-traded funds (ETFs) or managed/mutual funds in the Sharesight database.
Top 10 portfolio benchmarks used by Australian investors in Sharesight
When it comes to setting a benchmark, many investors leverage ETFs as these typically seek to replicate the performance of a common index, but are inclusive of the fees and costs involved in actually owning that basket of stocks. This also gives investors a realistic indicator of how their money could have performed, without the effort of picking stocks and building their portfolio.
We looked into the most commonly-used benchmarks by Australian Sharesight users and unsurprisingly, ETFs featured strongly.
Here are the top 10 benchmarks chosen by Australian Sharesight users:
1. SPDR 200 Fund
SPDR S&P/ASX 200 Fund (ASX: STW) is an ETF that aims to track the performance of the top 200 largest and most liquid publicly listed Australian companies, represented by the S&P/ASX 200 Index. It offers exposure to over 90% of the Australian equity market capitalisation.
2. Vanguard Australian Shares
Vanguard Australian Shares Index ETF (ASX: VAS) is an ETF designed to track the performance of the S&P/ASX 300 Index. It offers broadly diversified exposure to Australian companies and property trusts on the ASX.
3. Ishares Small Ords
iShares S&P/ASX Small Ordinaries ETF Index Fund (ASX: ISO) is an ETF that aims to track the performance of the small-cap Australian equities included in the S&P/ASX 300 index, but not in the S&P/ASX 100 index.
4. Ishares S&P/ASX 200
iShares Core S&P/ASX 200 ETF (ASX: IOZ) is an ETF designed to track the performance of the 200 largest Australian securities listed on the ASX.
5. SPDR S&P 500
SPDR S&P 500 Trust (ASX: SPY) is the world’s largest ETF, designed to track the 500 largest US companies. It covers approximately 80% of available market capitalisation.
6. SPDR 50 Fund
SPDR S&P/ASX 50 Fund (ASX: SFY) is designed to track the 50 largest and most liquid stocks on the ASX, using float-adjusted market capitalisation.
7. Vanguard All-World ex-US ETF
Vanguard All-World ex-US Shares Index ETF (ASX: VEU) is an ETF that seeks to track the return of the FTSE All-World ex-US Index, providing exposure to many of the world’s largest companies listed in major developed and emerging countries outside the US.
8. Vanguard Diversified High Growth ETF
Vanguard Diversified High Growth Index ETF (ASX: VDHG) is an ETF that aims to provide low-cost access to a variety of sector funds and allows diversification across multiple asset classes. Designed for long-term investors with a high risk tolerance, this ETF invests mainly in growth assets.
9. ASX Limited
ASX Limited (ASX) is Australia’s primary securities exchange; a leading global exchange offering diverse financial market services across multiple asset classes.
10. Vanguard International Shares
Vanguard International Shares Index Fund (ASX: VGS) aims to track the return of the MSCI World Ex-Australia Index (with net dividends reinvested) in Australian dollars before fees, expenses and tax. It offers exposure to many of the world’s largest companies listed in major developed countries, with access to a widely diversified range of securities.
Top 3 managed funds Australian investors benchmark their portfolio against
Managed funds also make good benchmarks, in that they have many of the same characteristics of ETFs. Below are the top 3 managed funds Australian Sharesight users benchmark their portfolio against:
Vanguard Australian Shares Index Fund
Vanguard Index Australian Shares Fund aims to track the return of the S&P/ASX 300 Index before account fees, expenses and tax; providing diversified exposure to Australian companies and property trusts on the ASX.
Vanguard High Growth Index Fund
Vanguard High Growth Index Fund is designed to track the weighted average return of the indices of the underlying funds in which it invests, which mainly consist of growth assets.
Vanguard Balanced Index Fund
Vanguard Balanced Index Fund seeks to track the weighted average return of the indices of the underlying funds in which it invests, which are a 50/50 balance between income asset classes and growth asset classes.
How to benchmark a portfolio in Sharesight
To get started with benchmarking, all you need to do is access your Sharesight portfolio and click ‘Add a benchmark’ in the ‘Summary’ section.
Sharesight allows you to select from a drop-down list of the most commonly-used benchmarks, or alternatively you can search for any stock, ETF, or managed (mutual) fund Sharesight supports to use as a benchmark of your choice.
In the future, if you wish to change your benchmark simply click ‘Edit benchmark’, also located in the ‘Summary’ section.
Benchmark your portfolio today
Sharesight’s benchmarking feature is just one of the ways Sharesight helps you to be a more informed investor. Benchmarking is available on Investor, Expert and Sharesight Pro plans. You can upgrade your plan to use this feature.
If you haven’t signed up for Sharesight yet, you can get started for free today.