Here are the worst performing ASX ETFs of 2021

Here are the worst ASX ETFs of 2021…

| More on:
ETF written in red across three piggybanks.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Overall, 2021 was a pretty decent year for ASX shares and the share market in general. Over the year just passed, the S&P/ASX 200 Index (ASX: XJO) returned roughly 13% from January to December, with the added bonus of dividends and franking credits thrown in. Thus, any exchange-traded funds (ETFs) that track the ASX 200 Index would have returned similar gains.

But even though ASX index funds are some of the most popular ETFs with Aussie investors, not all ETFs track indexes like the ASX 200. And as such, not all ASX ETFs had such a lucrative 2021.

So here is a list of the worst-performing ASX ETFs from last year:

2021's worst ASX ETF performers revealed

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

This ETF from provider BetaShares is first up. ASIA is a fund that tracks a basket of tech-focused shares from the Asia Pacific region. Many of its holdings hail from the People's Republic of China (43.9%), but it also has significant exposure to other countries like Taiwan, South Korea and India. You might recognise some of its top holdings like Taiwan Semiconductor Manufacturing Co, Samsung, Tencent Holdings and Alibaba Group Holding Ltd.

This ETF has clearly felt the repercussions of the slump in many Asian markets over the past year, particularly China's. It returned -14.94% last year.

iShares China Large-Cap ETF AUD (ASX: IZZ)

Another Asia-focused fund, this ETF from iShares was another poor performer last year. As you can probably gather from the name, IZZ invests in the largest companies in China. It holds many of the same companies as ASIA, including Alibaba and Tencent. But other names include Meituan, China Construction Bank Corp and Ping An Insurance. As we've just discussed, China hasn't had the best 12 months, and we can see this reflected in IZZ's performance. This ETF went backwards by 15.3% last year.

ETFS S&P Biotech ETF (ASX: CURE)

Despite its humorous ticker code, investors were probably not too amused by this fund's 2021 performance. CURE is a thematic ETF that focuses on US companies in the biotechnology space in fields such as genetic analysis and engineering. Some of its top holdings include Arena Pharmaceuticals, Biohaven Pharmaceuticals and Incyte Corp. Unfortunately for investors, this fund failed to engineer any growth last year, falling by 15.8% over 2021. Hopefully 2022 will CURE investors' woes.

BetaShares Strong Australian Dollar Fund (ASX: AUDS)

Here we have a different beast. This fund is a simple one and doesn't invest in shares at all. Instead, this ETF from BetaShares gives "geared exposure to changes in the value of the Australian dollar against the US dollar".

According to the provider, "AUDS generally expects to generate a positive return of between 2% and 2.75% for a 1% rise in the value of the Australian dollar against the U.S. dollar on a given day (and vice versa)". Unfortunately, the 'vice versa' is what occurred over 2021. This ETF fell a nasty 16.54% last year as the Aussie declined in value against the greenback for most of 2021.

Short ETFs top worst performing funds of 2021

Our final spot is shared jointly by three ETFs that proved very disappointing indeed for investors. This writer has grouped them together because they all operate in similar ways and their dismal performance can also be blamed on this. The BetaShares Australian Equities Strong Bear Hedge Fund (ASX: BBOZ), the BetaShares U.S. Equities Strong Bear Hedge Fund (ASX: BBUS) and the ETFS Ultra Short Nasdaq 100 Hedge Fund (ASX: SNAS) topped the ASX's worst ETF performers in 2021 with steep losses of 32.8%, 46.9% and 48.7% respectively.

These ETFs are 'short' funds that use leverage and other financial engineering to rise in value when the indexes they track fall. BBOZ inversely tracks the ASX 200, while both the BBUS and SNAS ETFs do the same for the US markets. Unfortunately for investors in these funds, both countries' markets rose strongly over 2021, resulting in these heavy losses.

Should you invest $1,000 in Cardano right now?

Before you buy Cardano shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Cardano wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ETFs

A happy young couple lie on a wooden deck using a skateboard for a pillow.
ETFs

3 high-conviction ASX ETFs to buy and hold forever

These funds could be quality picks for investors looking for buy and hold options.

Read more »

A young man punches the air in delight as he reacts to great news on his mobile phone.
ETFs

5 excellent ASX ETFs to buy now

Here are five funds that could be top picks for Aussie investors this month.

Read more »

Business people discussing project on digital tablet.
ETFs

Should you invest $3,000 into these top ASX ETFs this month?

Is now a good time to buy these funds? Let's find out.

Read more »

ETF spelt out with a piggybank.
ETFs

Is it too late to buy the VTS ETF and MOAT ETF after the rebound?

Was the best time to buy these ETFs last month?

Read more »

Hologram of a man next to a human robot, symbolising artificial intelligence.
ETFs

AI, cybersecurity, and defence: 3 megatrend ASX ETFs to watch now

Want to invest in some of the most exciting megatrends? Check out these funds.

Read more »

A business woman flexes her muscles overlooking a city scape below.
ETFs

3 ASX ETFs that could be strong buys in May

Looking for some investment ideas? Here are three to consider in May.

Read more »

Army man and woman on digital devices.
ETFs

3 reasons why Vaneck Global Defence ETF could beat the ASX 200 over the next year

Let's take a look at why this fund could be a top pick for investors.

Read more »

Five young people sit in a row having fun and interacting with their mobile phones.
ETFs

5 ASX ETFs to buy and hold until 2035

Check out these funds if you are looking to make buy and hold investments.

Read more »