New growth ETF addresses benchmark blindspot

VanEck is expanding its smart beta range with a new growth international equities strategy, the VanEck MSCI International Growth ETF (ASX: GWTH). Subject to final regulatory approval, this new ETF is expected to commence trading on ASX on 28 August 2025.

For over a decade, VanEck has pioneered smart beta ETF strategies in Australia, with several being the first of their kind on the ASX. These strategies offer investors the ability to construct portfolios with a targeted outcome in mind. GWTH is the newest addition, complementing VanEck’s international quality, value and small cap strategies.

The last decade has also seen ‘growth’ companies outperform ‘value’ companies after many decades of underperformance. Investing in growth stocks has traditionally been the domain of active managers, limiting access by the broader investor population. GWTH democratises this opportunity, with convenient access via ASX at a fraction of the typical active management fee. As with other smart beta strategies, it utilises a systematic, rules-based approach that targets outperformance.

Arian Neiron, CEO and Managing Director of VanEck Asia Pacific, said: “Investors have traditionally bolstered their risk-adjusted returns with allocations that focus on a specific sector, style, size or thematic. This is because the highest-growth stocks tend to be underrepresented in benchmarks. This manifested in the first half of 2025, where the highly visible NVIDIA, Apple and Microsoft mega-caps took a back seat to lesser-known stocks such as defence intelligence company Palantir Technologies (up 492% in the last year)* and mobile advertising platform AppLovin (up 417% in the last year).*

“GWTH will allow investors to add a dedicated growth exposure to their portfolio, for passive fees. Importantly, the growth factor is a diversifier away from the over-held companies, with NVIDIA being the only ‘Magnificent 7’ company currently included in the portfolio. Minimal overlap between GWTH, the international benchmark, and factor ETFs provides further diversification benefits.

“We undertook a comprehensive research and portfolio engineering process to work through shortcomings in global growth benchmarks. We observed that the traditional index often led to diluted growth exposure and style contamination, making it less effective for those seeking genuine growth factor returns. Our objective with GWTH was to develop a smart beta strategy that captured “pure” growth characteristics, and we believe that a disciplined approach to delivering growth exposure can overcome the style drift and capacity challenges often faced by active managers in this segment,” said Neiron.

The launch of GWTH will bring VanEck’s total number of ETFs on ASX to 46, and extends on the business’ commitment to innovation and helping investors access the opportunities.