Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 440

Five ideas for 2022

2021 has been another record year for ETFs in Australia. It has also been an unpredictable one. We expect ETFs to continue to grow in 2022. Here are our top five ideas as we enter the new year.

1 – Accessing the broad Australian economy in recovery - MVW

The Australian share market faces a tricky period in 2022 as the world continues to navigate the COVID pandemic. For Australian equity investors, a core strategy should provide exposure to all sectors of the economy to diversify risk, and get exposure to companies that can maintain and grow their earnings through uncertain times. This would include cyclicals such as energy and materials without an over exposure to the banks, which face headwinds as interest rates rise (property lending could be hit). Concentration, always a problem in the S&P/ASX 200 Index, is about to get worse with BHP consolidating its Australian and UK listing to become the biggest company on ASX. Investors buying an Australian equity strategy that contains 200 companies would think it is unlikely one stock would be 10% of the portfolio, nor would two sectors represent over 50% of the portfolio, but that is what you will be getting from a portfolio linked to Australia’s largest 200 companies. The VanEck Australian Equal Weight ETF (MVW) equally weights the largest and most liquid stocks on the ASX. It is underweight the mega-cap resources and big banks relative to the S&P/ASX 200 Index. As at 30 November 2021, MVW’s portfolio is underweight financials by 12.58%, mega-caps by 18.47% and overweight large-cap (+12.07) and mid-cap (+6.62%) stocks.

2 - Positioning for slowing growth in the wake of new COVID variants - QUAL

With COVID lockdowns ongoing and new disease variants travelling through the globe now and potentially in 2022, big questions hang over the global economic recovery. If the global economy does falter in 2022, stock markets too could stall. In this scenario, we believe quality companies could outperform as they tend to offer investors protection during weaker economic environments and heightened uncertainty and market volatility. VanEck MSCI International Quality ETF (QUAL) offers exposure to a diversified portfolio of quality international companies listed on exchanges in developed economies. Top holdings include Microsoft, Apple, Google owner Alphabet, Meta Platforms (formerly Facebook) and Nvidia, whose share price has shot up in 2021 given the shortage of computer chips which is expected to continue through 2022.

3 – Access a global megatrend - CLNE

The transition to clean energy and focus on climate change is one of the world’s most important global megatrends and presents a long-term growth opportunity. We expect this to accelerate into 2022. The Paris Agreement and recent Glasgow Climate Change Conference is driving demand for green, renewable energy across the globe away from fossil fuels. This is a significant long-term trend offering huge investment potential and clean energy companies could rally in 2022 as demand for renewable energy rises. The VanEck Clean Energy ETF (CLNE) currently provides exposure to 30 of the largest, most liquid global companies involved in clean-energy production and related technologies and equipment.

4 – Access a technology megatrend - ESPO

The explosion of video gaming before and during the COVID-19 pandemic has created significant investment opportunities in global gaming companies. Research house Newzoo forecasts the global game market will reach US$218.7 billion in 2024, up from US$175.8 billion in 2021. Positive secular trends are driving the long-term growth of gaming and esports, including an increasing number of gamers who also are spending more time gaming, not surprising given continuing lockdowns. Video gaming related stocks that have benefited from metaverse include Nvidia, now one of the largest companies in the US, Advanced Micro Devices and Roblox, all held by VanEck’s Video Gaming and esports ETF (ESPO).

5 – Follow the smart money - GPEQ

Private equity is important for investors’ portfolios. As an alternative investment, it displays a low correlation with other asset classes and it offers attractive risk and return characteristics, which will be important in 2022 given stock markets are expected to remain volatile. In addition, we believe the opportunities are huge. The private equity asset class is significantly bigger than the publicly listed market; an estimated 98% of companies are private while a mere 2% of companies are listed. The VanEck Listed Private Equity ETF (GPEQ) is an Australian first and it will open up a huge market and enable retail investors to participate in private equity, which has added appeal in the current low interest-rate environment.


Russel Chesler is Director, Investments & Portfolio Strategy at VanEck, a sponsor of Firstlinks. This is general information only and does not take into account any person’s financial objectives, situation or needs. Any views expressed are opinions of the author at the time of writing and is not a recommendation to act.



Leave a Comment:


Most viewed in recent weeks

Is it better to rent or own a home under the age pension?

With 62% of Australians aged 65 and over relying at least partially on the age pension, are they better off owning their home or renting? There is an extra pension asset allowance for those not owning a home.

Too many retirees miss out on this valuable super fund benefit

With 700 Australians retiring every day, retirement income solutions are more important than ever. Why do millions of retirees eligible for a more tax-efficient pension account hold money in accumulation?

Is the fossil fuel narrative simply too convenient?

A fund manager argues it is immoral to deny poor countries access to relatively cheap energy from fossil fuels. Wealthy countries must recognise the transition is a multi-decade challenge and continue to invest.

Reece Birtles on selecting stocks for income in retirement

Equity investing comes with volatility that makes many retirees uncomfortable. A focus on income which is less volatile than share prices, and quality companies delivering robust earnings, offers more reassurance.

Welcome to Firstlinks Election Edition 458

At around 10.30pm on Saturday night, Scott Morrison called Anthony Albanese to concede defeat in the 2022 election. As voting continued the next day, it became likely that Labor would reach the magic number of 76 seats to form a majority government.   

  • 19 May 2022

Comparing generations and the nine dimensions of our well-being

Using the nine dimensions of well-being used by the OECD, and dividing Australians into Baby Boomers, Generation Xers or Millennials, it is surprisingly easy to identify the winners and losers for most dimensions.

Latest Updates

SMSF strategies

30 years on, five charts show SMSF progress

On 1 July 1992, the Superannuation Guarantee created mandatory 3% contributions into super for employees. SMSFs were an after-thought but they are now the second-largest segment. How have they changed?

Investment strategies

Anton in 2006 v 2022, it's deja vu (all over again)

What was bothering markets in 2006? Try the end of cheap money, bond yields rising, high energy prices and record high commodity prices feeding inflation. Who says these are 'unprecedented' times? It's 2006 v 2022.


Tips and traps: a final check for your tax return this year

The end of the 2022 financial year is fast approaching and there are choices available to ensure you pay the right amount of tax. Watch for some pandemic-related changes worth understanding.

Financial planning

Is it better to rent or own a home under the age pension?

With 62% of Australians aged 65 and over relying at least partially on the age pension, are they better off owning their home or renting? There is an extra pension asset allowance for those not owning a home.


Listed infrastructure: finding a port in a storm of rising prices

Given the current environment it’s easy to wonder if there are any safe ports in the investment storm. Investments in infrastructure assets show their worth in such times.

Financial planning

Power of attorney: six things you need to know

Whether you are appointing an attorney or have been appointed as an attorney, the full extent of this legal framework should be understood as more people will need to act in this capacity in future.

Interest rates

Rising interest rates and the impact on banks

One of the major questions confronting investors is the portfolio weighting towards Australian banks in an environment of rising rates. Do the recent price falls represent value or are too many bad debts coming?



© 2022 Morningstar, Inc. All rights reserved.

The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. Any general advice or ‘regulated financial advice’ under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.

Website Development by Master Publisher.