Key Highlights

  • iShares Core Cash ETF (ASX:BILL) has the lowest fee of the three at 0.07%, with a listed Yield of 4.27%.
  • iShares Enhanced Cash ETF (ASX:ISEC) has a listed yield of 4.46% and a fee of 0.12%, with about 14% in bonds.
  • Betashares Australian Cash Plus Active ETF (ASX:MMKT) is actively managed, with a fee of 0.18% and no listed yield.
  • All three hold mainly cash and short-dated bank paper, but their issuer mix and approach differ.

Three cash-style Exchange-traded funds sit at the lower-risk end of the ASX fund range: iShares Core Cash ETF (ASX:BILL), iShares Enhanced Cash ETF (ASX:ISEC) and Betashares Australian Cash Plus Active ETF (ASX:MMKT). Each aims to earn a return close to short-term Money Market rates, but they take different routes to get there. This article compares their size, costs, yields and holdings so readers can see where the three funds diverge.

Measure

ASX:BILL

ASX:ISEC

ASX:MMKT

Listed price

$100.43

$100.39

$50.08

Fund size

$1.24 billion

$752.55 million

$719.97 million

Management fee

0.07%

0.12%

0.18%

Listed annual yield

4.27%

4.46%

Not shown

Holdings

81

91

170

Cash / bonds

98.83% / 1.17%

85.96% / 14.04%

78.66% / 20.54%

What each fund is built to do

ASX:BILL tracks the S&P/ASX Bank Bill index before fees, so its holdings are chosen to follow the index rather than to beat it. ASX:ISEC aims to outperform the same bank bill benchmark, which means it adds a small allocation to fixed-interest securities alongside cash. ASX:MMKT is actively managed and aims to provide a yield above the Bloomberg AusBond Bank Bill Index while preserving Capital and liquidity.

The practical difference is how much each fund depends on the manager. ASX:BILL is closest to a passive cash holding. ASX:ISEC and ASX:MMKT both rely on decisions about which securities to hold and how much to allocate to bonds.

Costs and income compared

The management fees range from 0.07% for ASX:BILL to 0.18% for ASX:MMKT, a gap that compounds over time. ASX:ISEC has the highest listed yield at 4.46%, reflecting its small bond allocation. ASX:BILL shows a listed yield of 4.27%, while the listing for ASX:MMKT shows no annual yield, even though it makes regular distributions.

Because all three income streams are linked to short-term interest rates, the yields will rise and fall together over time. The fee and the bond allocation can help explain differences between them.

Risks that differ between the three

Cash exposure is the common thread, but the risks are not identical. ASX:BILL holds mainly bank bills and cash, so its Credit exposure is concentrated in short-dated bank paper. ASX:ISEC adds fixed-interest securities, which adds some sensitivity to rate changes and a wider credit range. ASX:MMKT holds asset-backed and international bank paper, which brings additional credit and currency considerations.

Liquidity is not a concern for the largest of the three funds, but investors should consider how easily units can be bought or sold in smaller volumes, particularly for ASX:MMKT.

Final Word

The three cash-style funds share a broad purpose but differ in fee level, bond allocation and degree of active management. ASX:BILL is the simplest and lowest-cost option, ASX:ISEC adds a modest bond overlay for a higher listed yield, and ASX:MMKT offers an actively managed cash approach at a higher fee.