Most recently the Market Vectors Australian Equal Weight Index (MVMVW) had its one year anniversary as an underlying for the Market Vectors Australian Equal Weight ETF (ASX Code: MVW, Bloomberg code: MVW AU).
In its first full year the MVMVW Index outperformed the S&P/ASX 200 Accumulation Index by 3.91% returning 18.24%.
Australia has one of the highest concentration levels in the world with the top 10 securities comprise ~55% of the S&P/ASX 200 index. By equally weighting its holdings the MVMVW Index reduces the concentration risk to the top 10 and also provides better exposure to the broad Australian economy.
| 1 Month | 3 Months | 6 Months | 1 Year | |
|---|---|---|---|---|
| Market Vectors Australia Equal Weight Index | -0.72% | 5.77% | 8.27% | 14.16% |
| S&P/ASX 200 Index | -1.70% | 5.00% | 7.08% | 10.23% |
| Difference | +0.98% | +0.77% | +1.19% | +3.93% |
Source: Bloomberg, as at 30 April 2015
About the Author:
Arian Neiron is responsible for the strategy and day-to-day operations of VanEck’s Australian business. Prior to joining VanEck, Arian was a partner at boutique consulting firm Sunstone Partners, specialising in Asset and Wealth Management. Previously Arian worked for Perpetual as Senior Portfolio Specialist; Head of Product Development for Protected Investments; and Senior Product Manager for Platforms and Wholesale Funds. Arian has also held positions at Credit Suisse and MLC. Arian has a Bachelor of Commerce from Curtin University and a Diploma of Financial Services and is currently undertaking an MBA at Macquarie Graduate School of Management (MGSM).
The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.