The GMVW ETF provides leveraged exposure to a portfolio of large and liquid Australian companies, with stocks equally weighted rather than dominated by the largest banks and miners. It uses moderate gearing to magnify market gains and losses, while providing broader exposure across the ASX compared to a traditional market-cap-weighted index.
A standard ASX 200 ETF, and any geared versions, weight companies by market value. For example, CBA might represent ~10% of the index, whereas an equal-weight ETF gives each of the 200 companies the same allocation of roughly 0.5%. This means a 20% rise in CBA would contribute ~2.4% to the market-cap weighted index, versus just 0.1% in an equal-weight index. If the ASX 200 is to broaden out, meaning performance becomes less concentrated in the bigger players and the broader index performs, equal weight is a good way to capture that. Conversely, if the bigger players are likely to continue to drive the majority of gains, market weight is the better play.
The relatively small $42mn ETF targets gearing in the fairly broad range of 45-60%; its current multiple is 2.25x, higher than the GEAR, while its cheap compared to the GEAR ETF, only attracting a 0.35% pa costs.
The performance of the 3 ETFs in 2026, GEAR (+0.4%), G200 (+2.1%), and GMVW (+3.6%), shows that the GMVW ETF has merit in markets like todays when the heavyweight banks are noticeably underperforming.
- We like the GMVW ETF, believing it will be trading higher in a month.
