Low-Cost ETFs on the ASX: The Smart Way to Keep More of Your Returns (April 2026 Update)

In 2026, the ASX ETF market is worth $329.5 billion across 470+ funds. Of those, 71 ETFs charge 0.20% or less — the "low-cost" tier that covers virtually every major asset class. Combined they hold $141 billion, or 43% of all ETF money in Australia. Investors are voting with their feet.

This is the complete, data-driven list of low-cost ETFs on the ASX — updated to 31 March 2026 — with the actual MERs, AUM, 5-year returns, and the uncomfortable question nobody likes to ask: does low cost always mean better performance?

No fund manager wrote this. No issuer is paying for placement. Just data.

Why fees matter — the $213K chart

A $100,000 investment earning 7% p.a. gross, held for 30 years, with no additional contributions:

That's the arithmetic of compounding fees. Every extra basis point compounds against you, forever. For a long-term core portfolio, this is the single most important number.

Our fee ranking blog ranks every ASX ETF from cheapest to most expensive.

The 25 cheapest ETFs on the ASX

Notes on the top of the list:

• MQAE and VTS are tied as cheapest at 0.03% — MQAE is an active fund offering a near-passive experience. VTS is straight indexing.

• A200, IVV and A300 all charge 0.04% — but A300 has just $10M AUM versus IVV's $11.7B. Liquidity matters.

• VAS at 0.07% is 75% more expensive than A200 — and yet holds 2.5x the AUM ($23.3B). Scale and brand loyalty outweigh the 3-bp difference for most investors.

Where the low-cost money sits — every asset class covered

71 low-cost ETFs cover every major asset class:

You can build a genuinely complete portfolio using only low-cost ETFs. Australian equity + global equity + US equity + bonds covers 99% of what most investors need, and you can do the lot for well under 0.15% MER blended.

Best low-cost options in each category

🇦🇺 Australian equity

The big three (VAS, A200, IOZ) essentially give you the same exposure — the ASX 200/300. Pick based on cost sensitivity and issuer preference.

Note: VAS tracks the ASX 300 (broader), the others track the ASX 200. Over 5 years the difference is negligible. Our head-to-head comparison covers this trade-off.

🌍 Global equity (developed markets ex-Australia)

VGS at 0.18% is pricier than BGBL or IWLD but has enormous scale. Our VGS vs BGBL comparison dissects this trade-off.

🇺🇸 US equity

IVV has outperformed VTS over 5 years (+87% vs +78%) because mega-cap S&P 500 stocks beat the broader market during the recent bull run. Our IVV vs VGS vs VTS comparison breaks down the differences.

📊 Bonds / Fixed Income

Bonds have had a rough 5 years thanks to the rate-hike cycle. Our bond ETFs guide covers the full sleeve.

💰 Cash / Money Market

🏠 Diversified all-in-one

DHHF is the cheapest one-fund portfolio solution on the ASX. Note: VDHG and VDGR sit slightly above the 0.20% low-cost threshold but are the most liquid all-in-one options and worth mentioning for completeness.

The uncomfortable question: does low cost = better returns?

Low-cost ETFs (green dots) deliver consistently solid returns. But look at the top of the chart — the highest 5-year returns cluster around ETFs with higher fees (physical silver +227% at 0.49%, gold miners +222% at 0.53%, etc.).

What the scatter actually shows

1. Low-cost ETFs are reliable — almost all green dots sit at positive 5-year returns. The "floor" is strong.

2. The ceiling is higher with higher-fee products — but those products tend to be concentrated commodity/thematic plays, not broad-market alternatives.

3. For broad-market exposure, cheap wins every time. An index fund is an index fund. Paying more for VAS-equivalent exposure is just paying more.

4. For specialist exposure, fees matter less — there is no 0.04% uranium ETF or physical silver ETF. If you want that exposure, you pay what the market charges.

The nuance: low cost vs. best ETF

The title of our sister blog says it plainly: Is the cheapest ETF always the best? No — we tested every category. The answer is nuanced:

• ✅ For core broad-market exposure (Aus/Global/US equity, bonds): yes, cheapest wins over time

• ❌ For specialist exposure (commodities, factor tilts, thematics): not always — the cheap option may just not exist, or a slightly more expensive one has better methodology

The lesson: use low-cost ETFs as your core (60-100% of portfolio) and accept higher fees only on satellite positions where you have a specific thesis.

How to build a sub-0.10% MER portfolio

Here's a complete portfolio using only the cheapest ETFs on the ASX:

A blended 0.06% fee on $500,000 = $300 per year in fees. That's less than most monthly streaming subscriptions combined. And it covers the entire developed world's equity markets, plus fixed income and cash.

Compare that to a typical managed fund charging 1.00%+ = $5,000 per year on the same balance. That's the $4,700 annual savings that compound into the $179K gap over 30 years.

Low-cost ETFs to be aware of (but think twice about)

Cheap doesn't mean good if the underlying exposure isn't what you actually want:

• A300 (0.04% MER) — same fee as A200 but only $10M AUM. Liquidity is thin, spreads can be wider. Stick with A200 unless you specifically want ASX 300 coverage.

• V500 (0.07% MER) — S&P 500 exposure but tiny AUM ($53M) vs IVV ($11.7B). Vanguard launched it to compete with IVV on fee, but IVV remains the liquid choice.

• VBND (0.20% MER) — broad global aggregate bond. Solid product but 5Y return is −4% due to rate cycle. Bonds recover over time; this isn't a cost issue.

• Sub-scale ETFs under $50M AUM — cheaper isn't always better if spreads eat the savings. Check compare-etfs for real-world liquidity.

Bottom line

The low-cost revolution is genuine. $141 billion — 43% of all ETF money in Australia — is now in sub-0.20% MER funds. You can build a complete core portfolio for a blended MER under 0.10%.

The principles:

1. Core allocation (60-100%) should be low-cost broad-market index ETFs. VAS + VGS, or A200 + IVV, or A200 + IWLD + IAF. Every dollar you save on fees compounds forever.

2. Don't confuse cheap with best for specialist exposure. There is no 0.05% gold miners ETF. If you want that exposure, the market charges what the market charges.

3. Beware of sub-scale funds. The cheapest ETF is useless if you can't trade it without getting eaten by spreads.

4. Fees are the one variable you control with certainty. Returns are uncertain. Markets are uncertain. Fees are not.

The goal is to pay as little as possible for the exposure you actually need.

Related reading

• Every ASX ETF ranked by fees, cheapest to most expensive — full ranking across all 470+ funds

• Is the cheapest ETF always the best? — the nuance behind "cheap = good"

• VAS vs A200 vs IOZ — which Australian shares ETF is best?

• VGS vs BGBL — which international shares ETF should you buy?

• IVV vs VGS vs VTS — which international ETF should you buy?

• Every bond ETF on the ASX — the complete guide

• How to build your core portfolio with ETFs

Data current to 31 March 2026. Source: CBOE Australia monthly report. Total return calculations assume reinvested distributions where applicable. Past performance is not indicative of future results. This article is general information only and does not consider your personal situation. Seek professional advice before investing.