BetaShares NASDAQ 100 ETF (NDQ) is an exchange-traded fund that seeks to track the performance of the Nasdaq 100 Index. The index includes the largest and most liquid companies listed on the Nasdaq Stock Exchange. NDQ has been in operation since 2013 and currently has over $2.5 billion in assets under management. In this review, we will take a closer look at NDQ and determine whether or not it is a good investment option for you.
About BetaShares
Betashares was founded in 2013 and has become one of the most popular ETF issuers in Australia. They offer a range of products, including Australian and international shares, fixed income, commodities and currency.
BetaShares currently has over $750 million in funds under management, clearly showing that investors trust them with their hard earned dollars.
BetaShares offers approximately 50 ETFs, ranging from broad-based index funds such as their ASX200 fund A200 to single sector and themed products like Cybersecurity ETFs.
Their ETFs cover a wide range of asset classes, providing investors with exposure to global markets as well as Australian and international shares.
About The BetaShares NASDAQ 100 ETF
Are you looking for exposure to companies in the US and don’t want to go through the hassle of signing up for an international trading account? Well this ETF from BetaShares might be something of interest to you. Founded in 2015 the Betashares NASDAQ 100 ETF (ASX:NDQ) tracks the Top 100 (Non-Financial) companies in the US. Included in the Nasdaq portfolio are huge companies like Apple, Amazon, Facebook and Google. As you can see by excluding the financial sector this market attracts more Tech and Growth type stocks.
The fund is a passively managed ETF which means that it simply tracks the underlying index and doesn’t try to beat it. This ETF has been growing in popularity amongst Australian investors who are after exposure to the US markets. As of 2022 it had assets under management over $2 Billion dollars.
Performance
NDQ has provided stellar performance since its inception in 2015 providing total returns of over 21% per year! in comparison, if we look at our local Aussie index, the ASX200, it has only returned a measly 10% per annum. The performance of NDQ has been so good mainly due to the rise of huge tech companies like Apple, Facebook and Google.
As you can see in the above handy Sharesight Share Checker if you had invested $10,000 at the inception of the ETF in 2015 you would have tripled your money in just 7 years.. the insane power of compounding hey!
Before you rush out and put your life savings in NDQ just remember that past performance is not an indicator of future performance and always consult a professional before making investment decisions.
Top 4 Holdings in the BetaShares Nasdaq 100 ETF
Apple
Apple currently makes up the lion’s share of NDQ with 12.6% of the fund being invested in the Tech Giant.
Microsoft Group
Speaking of Tech Giants, Microsoft is the second largest investment with 10.1% of the fund being invested.
Amazon
Everyones favourite online retailer Amazon makes an appearance at number 3 with 7.1% of NDQ being invested in it.
Tesla
No NASDAQ review would be complete without mentioning Elon Musk and Tesla. Tesla currently makes up 4.1% of NDQ.
Fees
Fees are an important consideration when investing in a fund and the BetaShares NASDAQ 100 ETF is no exception. For investors in NDQ, BetaShares charges a modest annual 0.48% fee, which is taken out of the fund.
This amount may seem small, but it can add up to a considerable amount over time. When you compare NDQ to its younger Aussie cousin A200 which only charges 0.07% you can see that the fees are a lot higher on NDQ.
If the fund continues to perform well as it has been, this fee will be less of an issue – but if it underperforms, investors may feel the pinch. It is important to weigh up all of the fees associated with a fund before making a decision on whether or not to jump in.
The good news is that NDQ is a low-cost option when compared to some of the other funds on the market charging up to 0.75%p.a. This makes it a more affordable option for investors, who may be looking to get exposure to the US stock market.
Frequently Asked Questions
Who is BetaShares?
Be sure to check out the company bio at the top of the article for a brief overview of BetaShares. Otherwise, have a look at the BetaShares About on their website.
What is the NASDAQ 100?
The NASDAQ 100 is a stock market index made up of the hundred largest non-financial companies listed on the NASDAQ. The index is market-cap weighted, meaning the companies with the largest market caps have the greatest influence on their performance.
The NASDAQ 100 is often used as a barometer to gauge the performance of technology companies and growth stocks as it includes companies from various industries.
How do I buy NDQ?
Because NDQ is an ETF listed on ASX it can be bought on your chosen investment Platform just like any other stock. You can easily buy it through Investing Platforms like Pearler, Commsec or Selfwealth.
What are the benefits of NDQ?
BetaShares outlines three key benefits to investing in NDQ:
- Gaining exposure to 100 of Americas in a single trade.
- Exposure to the ‘New Economy’ with such a large focus on tech and growth stocks.
- No need to fill in a W-8 BEN form (US Tax Form) because the fund is domiciled in Australia! I think this is a key benefit for investors like me who hate extra paperwork.
Does NDQ Pay Dividends?
Yes, the BetaShares NASDAQ 100 ETF pays dividends. At the moment the yield sits at around 3.5% which is lower than other index funds but when you take into account the capital growth strategy of most Nasdaq stocks then the lower dividend yield makes complete sense.
Like most BetaShares funds these dividends can either be taken as cash or put into a dividend reinvestment plan which is our preferred method to really turbo charge your wealth.
In Summary
The BetaShares NASDAQ 100 ETF (ASX:NDQ) is a great way for Australian investors to get exposure to some of America’s largest and most influential companies. With Large investments in companies like Apple, Microsoft and Tesla, NDQ is a great option for those looking for exposure to the Technology and Growth sectors.
Fees are moderate when compared to similar funds on the market, but when you consider the high performance of NDQ to date this may not be a major issue. Dividends are paid quarterly and can be reinvested into more shares or taken as cash.
All in all if you’re looking for an easy way to get exposure to America’s top companies then NDQ is definitely worth considering.