Simple outperformance

The success of a portfolio, no matter how complex, is measured by its performance. If a portfolio can demonstrate strong performance against a benchmark and its peers it is considered successful.

In investing there is no investment process simpler to explain than equal weight: Each stock in the portfolio is held in the same proportion.

The portfolio of the Market Vectors Australian Equal Weight ETF (ASX: MVW) is simple and it has outperformed the benchmark most active Australian equity fund managers try to beat: the S&P/ASX 200 Accumulation Index (S&P/ASX 200 Index). It has also demonstrated strong performance compared to its peers.

Since MVW’s launch on the ASX on 4 March 2014 to 30 June 2015, it has outperformed the S&P/ASX 200 Index by 3.71% returning 10.51%. This performance consistently places MVW in the top 10% of all the funds in Morningstar’s Australian Equity manager universe.

The above data demonstrates current and short term outperformance. The ability for equal weight to outperform over the long term is supported by a large body of academic research in addition to our own research. The consistent, long term outperformance of MVW’s simple process can be seen by taking the performance of the index MVW tracks and adjusting it for the impact of MVW’s management costs of 0.35% p.a.

Long term performance vs benchmark

Adjusted for management costs, MVW Index produced superior performance to the standard Australian equity benchmark across each of the above medium and long term periods.

Calculated on the same basis, MVW Index also outperforms the median and mean of Australian equity fund managers in Morningstar’s Large Growth Universe, Large Value Universe and Large Blend Universe as shown in the tables below. These tables also highlight the fact that many active managers have consistently failed to achieve returns above the standard Australian market index.

Long term performance vs peers

The above performance history shows that keeping it simple can deliver outperformance.

Reignite your Australian equity portfolio with MVW, a transparent, low cost, liquid portfolio designed to outperform the standard market capitalisation index.

For more information on MVW click here or call us on 02 8038 3300.

IMPORTANT NOTICE: This information is issued by Market Vectors Investments Limited ABN 22 146 596 116 AFSL 416755 as responsible entity (‘MVIL’) of the Market Vectors MSCI World ex Australia Quality ETF (‘Fund’). MVIL is a wholly owned subsidiary of Van Eck Associates Corporation based in New York, United States (‘Van Eck Global’).
This is general information only and not financial advice. It does not take into account any person’s individual objectives, financial situation nor needs. Before making an investment decision in relation to the Fund, you should read the product disclosure statement and with the assistance of a financial adviser consider if it is appropriate for your circumstances. The PDS is available at www.marketvectors.com.au or by calling 1300 MV ETFs (1300 68 3837).
The Fund is subject to investment risk, including possible delays in repayment and loss of capital invested. Past performance is not a reliable indicator of current or future performance. No member of the Van Eck Global group of companies guarantees the repayment of capital, the performance, or any particular rate of return from the Fund.
Market Vectors Australia Equal Weight Index (‘MVW Index’) is the exclusive property of Market Vectors Index Solutions GmbH based in Frankfurt, Germany (‘MVIS’). MVIS makes no representation regarding the advisability of investing in the Fund. MVIS has contracted with Solactive AG (‘Solactive’) to maintain and calculate the MVW Index. Solactive uses its best efforts to ensure that the MVW Index is calculated correctly. Irrespective of its obligations towards MVIS, Solactive has no obligation to point out errors in the MVW Index to third parties.
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