Best ETFs for Australian Investors
Australian investors have strong ASX-listed global ETFs. Here are the best options and how to use your super and brokerage accounts.
Don't have time? Here's what you need to know:
- 1VAS (Australian shares) + VGS (international shares) is the classic two-fund Australian portfolio
- 2Australian equity ETFs carry franking credits — making them tax-efficient in personal accounts
- 3Superannuation taxes investment earnings at 15% vs your marginal rate — hold international ETFs inside super
- 4DHHF and VDHG are excellent one-fund solutions for Australian investors at 0.19-0.27%
Australia's ETF Market: Global Access From the ASX
The ASX hosts over 200 ETFs covering global markets. Vanguard Australia, iShares, BetaShares, and VanEck offer Australian-domiciled versions of popular global funds. You can build a globally diversified portfolio entirely through ASX-listed ETFs denominated in AUD, avoiding the complexity of foreign exchange.
Australian investors benefit from franking credits — tax credits on dividends from Australian companies that have already paid corporate tax. This makes Australian equity ETFs (VAS, IOZ) particularly tax-efficient in non-super accounts. International ETFs do not carry franking credits.
Best ETFs for Australian Investors (ASX-Listed)
| ETF | Category | Expense Ratio | Index | Franking Credits |
|---|---|---|---|---|
| VAS | Australian Shares (ASX 300) | 0.07% | S&P/ASX 300 | Yes |
| VGS | Intl Shares (Developed) | 0.18% | MSCI World ex-AU | No |
| VGE | Emerging Markets | 0.48% | FTSE Emerging Markets | No |
| DHHF | All-in-one global equity | 0.19% | Multi-index global | Partial |
| VDHG | Diversified High Growth (90/10) | 0.27% | Multi-index balanced | Partial |
| VAF | Australian Fixed Income | 0.20% | Bloomberg AU Composite Bond | No |
| IVV (ASX) | S&P 500 (iShares, AUD) | 0.04% | S&P 500 | No |
Super vs Personal Brokerage: Where to Invest
Superannuation is Australia's tax-advantaged retirement system. Inside super, investment earnings are taxed at 15% (vs your marginal rate of 32.5-45% outside super). Most industry super funds offer indexed investment options with fees under 0.20%. If your super fund's options are limited, a self-managed super fund (SMSF) lets you buy any ASX-listed ETF directly.
For personal (non-super) investing, a standard brokerage account at SelfWealth, Stake, or CommSec gives you access to all ASX-listed ETFs. Australian shares (VAS) benefit from franking credits in personal accounts. International shares (VGS) do not — so holding international ETFs inside super (lower tax rate) can be more tax-efficient.
Tip: A simple two-fund portfolio for Australian investors: VAS (Australian shares, 40%) + VGS (international shares, 60%). This gives you global diversification with franking credit benefits on the Australian portion.
Frequently Asked Questions
Should I use VAS or IOZ for Australian shares?
VAS (ASX 300, 0.07%) is broader than IOZ (ASX 200, 0.09%). VAS includes 100 additional smaller companies. Both are excellent. VAS is marginally cheaper and more diversified.
DHHF or VDHG as a one-fund solution?
DHHF is 100% equities (no bonds). VDHG is 90% equities, 10% bonds. For investors under 40 with high risk tolerance, DHHF is more growth-oriented. For a slightly more balanced approach, VDHG. Both are excellent set-and-forget options.
Which Australian broker is best for ETFs?
SelfWealth ($9.50 flat fee per trade), Stake ($3 brokerage for ASX trades), and CommSec (pocket app for micro-investing). For larger portfolios, Interactive Brokers offers the lowest fees. Vanguard Personal Investor also offers direct ETF purchases.
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Alex Harrington
CFA Level II Candidate, Finance & Economics
Alex Harrington is an independent ETF researcher and personal finance writer with over 8 years of experience analyzing exchange-traded funds. A CFA Level II candidate with a background in economics, Alex has reviewed 800+ ETFs and helped thousands of beginners build their first investment portfolios through clear, jargon-free education.
This content is for educational purposes only and does not constitute financial advice. Past performance does not guarantee future results. Consult a licensed financial advisor before making investment decisions.