VAS vs A200: which Australian shares ETF should you buy?
Both track Australian shares, both are cheap, both pay franking credits. Here's the actual difference — and why it's smaller than most people think.
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Side-by-side comparison
| VAS | A200 | |
|---|---|---|
| Provider | Vanguard | BetaShares |
| Index tracked | S&P/ASX 300 | Solactive Australia 200 |
| Number of holdings | ~300 companies | ~200 companies |
| MER (annual fee) | 0.07% | 0.04% |
| Distribution freq. | Quarterly | Quarterly |
| Franking credits | Yes (high) | Yes (high) |
| CHESS sponsored | Yes | Yes |
| Approx. div. yield | ~4–5% p.a. | ~4–5% p.a. |
Data approximate as at May 2026. Verify on provider websites.
Why the performance difference is tiny
The ASX 300 vs ASX 200 distinction sounds significant, but in practice:
- The top 200 companies represent approximately 95–96% of the total market capitalisation of the ASX 300.
- Stocks ranked 201–300 are small-cap companies — individually tiny, collectively marginal.
- Over 10 years, the performance difference between VAS and A200 has been less than 0.1% per year.
If you already hold A200 and want broader small-cap exposure, you could add a small allocation to a small-cap ETF (like VSO). But for most investors, it's not worth the complexity.
The big sectors in both
Australian shares are heavily concentrated in financials and materials. Both VAS and A200 reflect this:
Approximate sector weights — may vary. Source: Vanguard/BetaShares factsheets, May 2026.
Franking credits: why Australian ETFs are tax-efficient
Australian companies pay 30% corporate tax before distributing dividends. When they pass on a franked dividend, they include a "franking credit" representing the tax already paid. As an ETF investor, you receive these credits on your annual tax return.
At a 32.5% marginal rate: you owe an extra 2.5% on the dividend, not the full 32.5%. At a 16% marginal rate: you actually receive a refund of 14% (the tax overpaid by the company). This makes domestic ETFs significantly more tax-efficient than international ETFs for Australian investors with lower incomes or in retirement.
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Frequently asked questions
What is the difference between VAS and A200?
VAS (Vanguard Australian Shares Index ETF) tracks the S&P/ASX 300 index — the top 300 ASX-listed companies. A200 (BetaShares Australia 200 ETF) tracks the Solactive Australia 200 index — effectively the top 200 companies. A200 has a lower MER (0.04% vs 0.07%). In practice, the top 200 companies make up over 95% of the weight in the ASX 300, so performance is nearly identical.
Is A200 better than VAS because it's cheaper?
On cost alone, A200 is slightly cheaper (0.04% vs 0.07% p.a.). On a $50,000 portfolio, that's a $15/year difference. Both are excellent, low-cost ETFs. The extra 100 companies in VAS (stocks 201–300) represent less than 5% of total market cap, so the performance difference is negligible. Most investors who prioritise fees choose A200; those who prefer Vanguard's brand and slightly broader index choose VAS.
Do VAS and A200 pay franking credits?
Yes — both pay quarterly distributions that include franking credits from the Australian companies they hold. Since most large Australian companies (banks, miners, retailers) pay fully franked dividends, both ETFs carry significant franking credit entitlements. These credits can reduce your personal tax bill or generate a refund if your marginal rate is below the 30% corporate tax rate.
Is VAS CHESS-sponsored?
Yes. VAS is issued by Vanguard Investments Australia and is CHESS-sponsored, meaning shares are registered in your name on the ASX CHESS system. A200 is also CHESS-sponsored. Both are held securely regardless of what happens to the broker you use to buy them.
Can I hold VAS or A200 in super?
Yes. If you have a self-managed super fund (SMSF) or a platform like Spaceship, Hostplus, or Australian Super that allows direct ETF investment, you can hold VAS or A200 inside super. Gains and income are taxed at 15% (or 10% if held over 12 months) rather than your marginal rate — a significant advantage for long-term wealth building.
Should I use VAS or A200 alongside a global ETF?
Either works. A common two-fund portfolio for Australians is 30–40% VAS (or A200) + 60–70% VGS (Vanguard MSCI international, unhedged). This gives broad global diversification with a home bias for franking credit benefits. The split between VAS and A200 doesn't matter — just pick one and stick with it.