VanEck reduces ETF fees

VanEck has lowered the management fees for two of its exchange traded funds (ETFs), the FTSE Global Infrastructure (Hedged) ETF (IFRA) and the FTSE International Property (Hedged) ETF (REIT), following a fee review.

Effective from 3 July, the new fees will be 0.20 per cent per annum, as part of the manager’s efforts to increase investor access to its international property and infrastructure strategies.

Australia’s first global infrastructure ETF, IFRA offers investors access to a range of companies that are well-positioned “to benefit from the estimated $60 trillion global outlay needed to upgrade aging utilities by 2035”, VanEck Asia Pacific CEO and Managing Director, Arian Neiron, said.

The fund tracks the FTSE Developed Core Infrastructure 50/50 Hedged into Australian Dollars Index, which includes companies that own and operate the necessary foundations for society to function including fibre networks, telecommunication towers, transport, energy, water and social services. It aims to return stable income that is often regulated and linked to CPI, providing more defensive elements that benefit during high-inflation periods.

REIT, which tracks the FTSE EPRA Nareit Developed ex Australian Rental Index AUD Hedged, gives investors exposure to a diversified portfolio of international property in developed markets excluding Australia and returns hedged into Australian dollars.

“Investor interest in our infrastructure and international property funds has been strong this year and it’s not surprising given the reliable income stream IFRA and REIT offer investors,” Neiron said.

“By reducing our management fees we are enabling more investors to gain access to the opportunity that these funds offer. We are confident that the new fees encourage more investors and their advisers to consider IFRA and REIT as diversifiers for their portfolios.

“We think these asset classes represent core exposures and these products are being used by investors as the market beta strategic asset allocation in portfolios. The new fees are consistent with our business objective of providing investors with opportunities to access the best investment outcomes.”

VanEck’s use of the ‘Taxation of Financial Arrangements’ (TOFA) currency hedging rules also allow investors in IFRA and REIT to earn a stable income over the long-term.