RARI Posts 18.77% Total Return, Slightly Below Benchmark in FY25
The Russell Investments Australian Responsible Investment ETF (RARI) posted a solid 18.77% total return for the year ending June 2025, slightly trailing its benchmark index. This update highlights the fund's steady performance amid evolving market conditions.
- RARI ETF achieved 18.77% total return for 1-year period ending June 2025
- Fund’s returns slightly below Russell Australia ESG High Dividend Index benchmark
- Consistent distribution returns averaging around 4-5% annually
- Performance net of fees and expenses across multiple time horizons
- Fund emphasizes responsible investment aligned with ESG principles
Steady Growth in a Responsible Investment Vehicle
The Russell Investments Australian Responsible Investment ETF (RARI) has reported its fund performance for the fiscal year ending 30 June 2025, delivering a total return of 18.77%. This figure, which accounts for both growth and distributions net of fees, reflects a strong showing in a market environment that continues to reward ESG-focused strategies.
While the fund’s 1-year total return slightly trails the benchmark Russell Australia ESG High Dividend Index, which posted 19.30%, the difference is marginal. Over longer periods, RARI’s returns have remained competitive, with annualised total returns of 16.18% over two years and 14.73% over three years, underscoring the fund’s consistency.
Balancing Growth and Income
RARI’s performance is notable not only for capital appreciation but also for its steady distribution returns, which have hovered around 4-5% annually. This balance appeals to investors seeking both income and growth within a responsible investment framework. The fund’s focus on companies meeting environmental, social, and governance criteria aligns with growing investor demand for sustainable investment options.
Significantly, the reported returns are net of fees and expenses but exclude transactional costs incurred by investors trading on the ASX. The fund’s disclosures also remind investors of the inherent risks, including potential delays in repayment and loss of income or principal, emphasizing the need for careful consideration of individual financial situations.
Looking Ahead
As ESG investing continues to gain traction, RARI’s performance will be closely watched by investors and analysts alike. The fund’s ability to maintain competitive returns while adhering to responsible investment principles positions it well in a crowded ETF market. However, the slight underperformance relative to the benchmark raises questions about how the fund will navigate future market volatility and evolving ESG standards.
Bottom Line?
RARI’s solid returns affirm ESG investing’s appeal, but future performance will test its resilience amid shifting market dynamics.
Questions in the middle?
- How will RARI adjust its portfolio to close the gap with its benchmark?
- What impact will evolving ESG regulations have on the fund’s holdings?
- Can the fund sustain its distribution yield in a changing interest rate environment?
