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Revealed: Best and worst performing ETFs of 2020

·2-min read
A man holds a phone that shows performance of stocks on a graph. Three building blocks that say ETF.
ETFs are booming and now worth over $100 billion in Australia (Source: Getty)

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Exchange Traded Funds (ETFs) have been growing in popularity amongst Aussies as an easier, more cost-effective means of investing.

In fact, since 2019 the amount of Aussies searching for “ETFs” in their internet browser has tripled.

And clearly the interest has gone beyond that with the amount of money invested in ETFs in Australia growing 79 per cent to over $100 billion in the past year.

So which ETFs should I buy?

There are not over 200 ETFs on the ASX available to invest in ranging from industries to companies, broad or narrow.

According to Stockspot’s annual ETF Report which analyses the best, worst, and most popular ETFs in Australia, the best performing ETF in the last year was an ETF that invested in batteries and lithium called ACDC.

This ETF provided investors with a whopping 96 per cent return on their investment.

Following that was the K2 Australian Small Cap Fund, which gave its investors a 95 per cent return.

Here are the top five performing ETFs:

  1. ETFS Battery Tech & Lithium ELF (ASX: ACDC) - 96 per cent return

  2. K2 Australian Small Cap Fund (Hedge Fund) (ASX: KSM) - 95 per cent return

  3. BetaShares S&P/ASX Technology ETF (ASX: ATEC) - 81.6 per cent return

  4. ETFS FANG+ ETF (ASX: FANG) - 73 per cent return

  5. eInvest Future Impact Small Caps Fund (IMPQ.AX) (Managed Fund) - 70.9 per cent return

But before rushing to buy ACDC with hopes of doubling your wealth, Chris Brycki, Stockspot CEO and co-author of the annual Stockspot ETF Report, said there are other factors that need to be considered.

“ETFs are an alternative, but the best performing and the worst performing ETFs aren't a great indicator of what people should invest in,” he said.

“This is because ‘best’ and ‘worst’ always changes. In fact, often the worst performer in one year is the best performer in another.”

For example, the worst performing ETFSs in the last year are those which were hit the hardest by COVID-19 but are generally considered safe havens, like gold.

Volatile products with higher than average fees like currency ETFs lost investors money, while some precious metal ETFs struggled.

Since the lows of March 2020, the Australian dollar rose against global currencies, which led to currency ETFs, such as the US dollar and Euro, seeing poor performance.

Here are the five worst performing ETFs:

  1. BetaShares Australian Equities Bear (Hedge Fund) (ASX: BEAR) - down 30.3 per cent

  2. BetaShares US Dollar ETF (ASX: USD) - down 18.9 per cent

  3. ETFS Physical Gold (ASX: GOLD) - down 15.9 per cent

  4. Perth Mint Gold (ASX: PMGOLD) - down 15.4 per cent

  5. Betashares Euro ETF (ASX:EEU) - down 14.3 per cent

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