What Are the Best Performing ETFs to Watch in Australia 2025?

As Australia’s investment landscape continues to evolve in 2025, Exchange Traded Funds (ETFs) remain one of the most popular and accessible ways for investors to grow their wealth. Whether you’re a beginner building your first portfolio or an experienced trader seeking diversification, finding the best ETF in Australia has to offer can help you gain exposure to top-performing sectors—from technology and energy to healthcare and sustainable investing. With the ASX hosting a growing number of ETFs, investors now have more choices than ever to match their financial goals and risk tolerance.

In this guide, we’ll explore the best performing ETFs in Australia that investors are watching closely in 2025. We’ll take a look at funds that have demonstrated strong returns, low management fees, and consistent performance across market cycles. Whether your focus is on income, growth, or global exposure, these ETFs represent some of the most promising opportunities for Australian investors looking to make smarter, diversified investment decisions.

Background of investing in ETFs in Australia

ETFs have become a cornerstone of modern investment portfolios, particularly for investors seeking the ETFs that are both performing well and suitable for their portfolio in Australia. ETFs offer the advantage of diversification, allowing access to a broad spectrum of assets through a single tradable security.

What are ETFs?

ETFs are an efficient means of investing in a diverse range of assets. They are funds that track indices, sectors, commodities, or specific themes and can be traded on stock exchanges just like individual stocks.

ETF Types

Currently, ETFs are categorised into several main types: Equity ETFs, Bond ETFs, Commodity ETFs and Currency ETFs. Each type of ETF has its own unique investment characteristics and risk-return profiles, which are suitable for different types of investors and investment strategies.

1. Equity ETFs

• Index ETFs: These track a broad market index, such as the BetaShares Australia 200 ETF.

• Sector ETFs: They focus on specific sectors, including technology, healthcare, finance, and energy.

• Thematic ETFs: Primarily tracks specific economic, social or technological trends. For example, sustainability ETFs.

2. Bond ETFs: These track the performance of the bond market, encompassing government bonds, corporate bonds, and high yield bonds.

3. Commodity ETFs: They invest in physical commodities or commodity futures contracts, like oil, gold, copper, or coffee.

4. Currency ETFs: These track a single currency or a basket of currencies, such as the US Dollar Index (DXY).

Australia's ETF Market

Australia's ETF market has seen robust growth in recent years, capturing the attention of global investors with its rapidly expanding asset base, diverse product offerings, and innovative edge. The market includes a range of traditional equity and bond index-tracking ETFs, as well as unique thematic investments in areas such as clean energy, technology, real estate, gold, and even cryptocurrencies, showcasing the market's strong innovation and keen awareness of emerging trends.

The Australian Securities Exchange (ASX) has been pivotal in this development, offering a platform for trading ETFs with the same ease as stocks, characterized by low costs and high market transparency, appealing to investors who are mindful of expenses. Under a rigorous regulatory framework, the Australian Securities and Investments Commission (ASIC) safeguards the market's health and investor rights, while also fostering investor education to improve public understanding and proficiency in applying ETF investment strategies.

Consequently, the Australian ETF market is an ideal destination for investors seeking diversified, cost-effective, and accessible investment avenues. It also serves as a significant indicator of the global ETF industry's development.

Why Australian Investors Choose ETFs？

• Cost-Effective Diversification: ETFs are favored by investors for their ability to provide access to a wide array of markets and asset classes. They enable investors to construct a diversified portfolio with ease, whether it involves local or international stocks, commodities, or bonds. Additionally, ETFs offer the advantage of lower expense ratios compared to other investment options.

• Flexibility and Liquidity: Tradable on major exchanges like the Australian Stock Exchange, ETFs offer flexibility. Investors can buy and sell throughout the trading day, allowing for swift reactions to market fluctuations or adjustments in line with evolving investment strategies.

• Transparency and Simplicity: With daily disclosures of their holdings, ETFs provide transparency, giving investors a clear view of their investment composition. This straightforward approach is appealing to investors who value knowing the exact makeup of their investments.

• Innovation and Choice: The Australian ETF market is dynamic, continuously introducing innovative products that target niche sectors, thematic investments, and ESG criteria. This variety ensures that investors of all types can find an ETF that aligns with their preferences.

What are the best ETFs in Australia?

Below is a list of the best ETFs in Australia for 2025. This selection includes both ETFs traded on the ASX and those focused on other regions that are accessible to Australian investors. These funds span a diverse array of sectors, strategies, and themes. The selection was made by considering a variety of factors, including historical performance, expense ratios, asset size, and potential for future growth.

Invesco QQQ Trust, Series 1(QQQ)

The Invesco QQQ Trust (QQQ) continues to track the Nasdaq 100 Index and remains heavily weighted toward the technology sector, encompassing companies spanning software development, internet services, semiconductors and IT infrastructure. Thanks to its large asset-base and strong liquidity, the fund offers substantial trading flexibility and the ability to capture growth-oriented upside over time.

As of 2025, QQQ’s expense ratio remains at a very competitive 0.20%. According to recent data, the fund’s total assets under management have risen to approximately US $385.8 billion. In terms of performance, QQQ has delivered roughly a 22 % return over the past 12 months and a year-to-date return of about 18-19 % in 2025. These figures illustrate how QQQ continues to capitalise on the strength of high-growth companies and the innovation-centric technology sector, albeit with the volatility characteristic of such exposures.

Vanguard S&P 500 ETF (VOO)

The Vanguard S&P 500 ETF (VOO) offers investors broad exposure to the top 500 U.S. corporations that comprise the S&P 500 Index, representing a wide cross-section of industries driving the U.S. economy. VOO continues to stand out for its extremely low cost structure (the expense ratio remains around 0.03 %) and its vast scale — as of early 2025 its assets under management have climbed to approximately US $650-800 billion.

In terms of performance, VOO has delivered a trailing-12-month return of roughly ~17 % as of mid-2025 and a year‐to‐date (YTD) gain of around ~14 % to ~11 % depending on the time period referenced. While moderate volatility remains given its exposure to large-cap equities across sectors, VOO’s broad diversification, ultra-low fees and immense liquidity make it a highly compelling choice for long-term investors seeking core U.S. equity market exposure in 2025.

SPDR Gold Shares ETF (GLD)

The SPDR Gold Shares ETF (GLD) remains one of the most prominent vehicles for gaining exposure to gold bullion, providing investors with a convenient, liquid way to hedge against market volatility and inflation without directly holding physical metal. The fund tracks the price of gold and holds physical gold reserves on behalf of shareholders. As of mid-2025, GLD has assets under management exceeding US $99 billion. Its expense ratio remains at approximately 0.40%, keeping costs low for investors seeking safe-haven exposure.

In terms of performance, GLD has delivered an exceptional recent run: its year-to-date (YTD) return is around +60.65%, and the trailing 12-month total return is approximately +56.45% as of 2025. While data for exactly the “last 250 trading days” isn’t readily published, these figures underscore GLD’s strong momentum in 2025, reflecting an increased investor preference for gold amid global uncertainty.

Energy Select Sector SPDR Fund (XLE)

The Energy Select Sector SPDR Fund (XLE) remains a key way for investors to gain broad exposure to the U.S. energy sector—from traditional oil & gas exploration and production to energy equipment and service companies and other subsectors of the energy ecosystem. As of mid-2025, XLE’s assets under management are approximately US $26.27 billion. Its expense ratio (net) is around 0.08%, reflecting a very low-cost structure for sector exposure.

In terms of recent performance, XLE has posted a year-to-date (YTD) return of about +3.45% as of July 31, 2025, while its one-year total return stands at approximately -3.36%, indicating how the energy sector has experienced both resilience and cyclical headwinds in 2025.

Direxion Daily Semiconductor Bull 3X Shares ETF(SOXL)

The Direxion Daily Semiconductor Bull 3X Shares ETF (SOXL) continues to offer amplified exposure—three times the daily performance—of the semiconductor sector’s benchmark index, targeting companies involved in the design, manufacture and distribution of semiconductors and related products. As of 2025, SOXL’s assets under management are approximately US $12.95 billion. Its management expense ratio remains around 0.75%.

In terms of recent performance, SOXL has delivered a year-to-date total return of about +48.46% as of mid-2025. Fully acknowledging its leveraged nature, SOXL embodies significant upside potential in strong semiconductor cycles, but with high risk—its magnified exposure means it can rise sharply in booming semiconductor demand phases and suffer steep losses when that demand softens.

BetaShares NASDAQ 100 ETF(NDQ)

The BetaShares NASDAQ 100 ETF (NDQ) replicates the performance of the Nasdaq‑100 Index, providing Australian investors with exposure to the largest non-financial companies listed on Nasdaq across technology, telecommunications, retail and biotechnology sectors. As of mid-2025, NDQ has an expense ratio of approximately 0.48% (p.a.). Total assets under management are in the vicinity of A$7.56 billion.

In terms of recent performance, NDQ delivered a one-year total return of about 28.96% (to 30 September 2025). While the exact “last 250 trading days” figure is not publicly broken out, this strong annual result underscores the substantial growth potential of its underlying holdings and the robust momentum in US large-cap technology stocks. For investors seeking diversified access to major US growth names via the ASX, NDQ remains a highly competitive option given its fee structure, sizeable asset base and track record.

Vanguard MSCI Index International Shares ETF（VGS）

The Vanguard MSCI Index International Shares ETF (VGS) gives Australian investors broad exposure to developed-market equities (excluding Australia), tracking the MSCI World ex‑Australia Index (with net dividends reinvested) in AUD. According to the latest fact-sheet, VGS holds approximately 1,281 stocks, with a median market cap of about A$279.3 billion. The management expense ratio remains at 0.18%.

In terms of recent performance, VGS delivered a one-year return of approximately 23.28% as of 30 September 2025. With its low cost structure, global spread, and ability to capture international equities growth, VGS remains an appealing option for Australian investors looking for developed-market diversification in 2025.

Vanguard Australian Property Securities Index ETF (VAP)

The Vanguard Australian Property Securities Index ETF (VAP) continues to offer Australian investors focused exposure to the domestic property investment market, tracking the S&P/ASX 300 A‑REIT Index—which is comprised of listed A-REITs owning and operating shopping centres, office buildings, industrial/logistics facilities and other commercial real estate. Its management expense ratio remains at approximately 0.23% p.a.. As of the most recent reports (to 30 June 2025), VAP’s total fund size is around A$6.26 billion.

In terms of performance, VAP posted a year-to-date return of about +10.94% as of 30 June 2025. Given its exposure to property assets, VAP can offer relatively lower volatility compared to some broader equity funds, albeit still subject to influences such as interest-rate movements, economic cycles and real-estate market dynamics.

BetaShares Global Sustainability Leaders ETF(ETHI)

The BetaShares Global Sustainability Leaders ETF (ETHI) offers Australian investors exposure to companies globally that are identified as climate leaders and meet strict ethical screens under the NQFGSLN (Nasdaq Future Global Sustainability Leaders) Index.

According to the latest factsheet as at 30 September 2025, ETHI’s expense ratio stands at 0.49% p.a. and it holds a diversified basket of large global equities that meet responsible investment criteria. The fund’s net assets have grown from the earlier figure of ~A$2.988 billion to around A$3.73 billion, reflecting stronger investor demand for sustainability-themed ETFs.

Vanguard Australian Shares High Yield ETF (VHY)

Vanguard Australian Shares High Yield ETF (VHY) is an ASX-listed ETF designed to track a high dividend yield index of Australian stocks, aiming to deliver higher income relative to the broad Australian market while seeking long-term capital growth. The fund, managed by Vanguard Investments Australia, charges a competitive MER and distributes dividends quarterly, providing a transparent, cost-efficient way to gain exposure to Australian dividend-focused equities.

How to invest in the best ETFs in Australia?

Trading the best ETFs in Australia requires a certain strategic approach that combines market awareness, platform proficiency and a clear understanding of investment objectives. Here are some trading steps to help investors trade ETFs.

Understanding ETF trading

Investing in the best ETF in Australia requires a detailed understanding of how it works in the financial markets. They are usually set up by fund management companies to track the performance of a particular index, asset class, sector or investment strategy. They are listed and traded on stock exchanges with their own ticker symbols, just like ordinary shares. In addition to trading in the secondary market, ETFs allow authorised participants (usually large financial institutions) to conduct the creation and redemption process in the primary market. This mechanism helps keep the ETF market price closely linked to its underlying net asset value (NAV).

Choose a broker

• Broker Comparison: Compare online brokers based on fees (trading commissions, account maintenance), platform features, research tools and customer support. Choose a reliable and efficient online brokerage platform with direct access to the Australian Stock Exchange (ASX) and various ETFs.

• Demo Accounts: Many brokers offer demo accounts, which can be used to familiarise yourself with the platform's operation, improve your trading skills and practice your trading strategies.

Research and selection

• Market analysis: Start by researching market trends and identifying sectors that are expected to perform well. Consider factors such as economic indicators, sector growth forecasts and global events that may affect the ETF market.

• Performance indicators: Look for ETFs with a history of outperformance. review their returns, expense ratios and tracking errors over the past year. Use online resources and financial news to filter out the best performing ETFs in Australia.

• Thematic vs index: Decide whether you prefer a thematic ETF that aligns with specific trends, such as technology, environment, society and governance, or an index ETF that tracks a broader index, such as the A200.

Trading strategies

• Dollar cost averaging (DCA): Investors reduce market timing risk by investing a fixed amount of money in their chosen ETF on a regular basis, regardless of its current price. This strategy is more effective in volatile markets and allows investors to accumulate at different price points, potentially reducing the average cost over time.

• Sector rotation: Sector rotation is the process of switching investments between ETFs in different sectors based on market conditions and economic cycles. By identifying sectors that are expected to outperform, investors can adjust their portfolios to take advantage of these trends, thereby optimising their portfolios.

• ETF options trading: For the skilled investor, ETF options offer additional layers of strategy. Whether hedging, speculating or generating income, options capitalise on the price movement of the underlying ETF. This approach offers the potential for higher returns while increasing risk.

• Short selling: Short selling involves borrowing an ETF and selling it in the market in anticipation that the price will fall so that the investor can buy back the ETF at a lower price and return it to the borrower, earning the difference in price. This strategy carries a high degree of risk and can be used when the market is depressed or when investors believe a particular ETF is overvalued.

Monitoring and rebalancing

• Periodic review: Focus on factors such as capital flows, expense ratios and changes in underlying asset allocation. Pay close attention to regulatory changes, economic indicators and market sentiment that may affect the ETF's trajectory.

• Rebalancing: Rebalance its portfolio on a regular basis to ensure that the investments are in line with its risk tolerance and investment objectives. Monitor the ongoing performance of the invested ETFs to decide whether to hold, add to or divest from them.

Final thoughts on best performing ETFs in Australia

In summary, Australia's ETF market is experiencing robust growth and presents a diverse array of products, offering investors a plethora of investment opportunities. Identifying the top ETFs in Australia necessitates a blend of thorough research, astute observation of market dynamics, and a steadfast commitment to your investment objectives. When entering the realm of ETF investing, as a prudent investor, consider whether your choice aligns with your thematic focus, index tracking, or strategic asset allocation. Ensure that your ETF portfolios are congruent with your risk tolerance, investment horizon, and targeted returns.

Financial markets are in a perpetual state of flux, and investment strategies must evolve in tandem. Regularly review your portfolios, evaluate the performance of your chosen ETFs, and make informed adjustments grounded in market insights to maintain investment flexibility. The selection of the best ETFs is not static. It is a dynamic element of a well-crafted investment plan. By adopting a comprehensive approach that integrates meticulous research, robust trading platforms, and a disciplined mindset, you can discern the most suitable ETF for your investment needs within the vast array available in Australia.