Global X S&P Australia GARP ETF (ASX: GRPA)

The Global X S&P Australia GARP ETF (GRPA) offers a sophisticated entry point into the Australian equity market by targeting fifty premier companies that balance robust earnings growth with sensible valuations. By tracking the S&P/ASX 200 GARP Index, this fund employs a methodology famously championed by Peter Lynch, focusing on entities with high returns on equity and solid financial foundations.

Historically, this Growth at a Reasonable Price strategy has capitalised on the tendency for high-quality Australian firms to outperform their peers, delivering a consistent edge over the broader market. GRPA functions as a transparent, lower-cost alternative to traditional active management, effectively bridging the gap between growth and value. It provides a diversified core exposure that seeks to mitigate the volatility of expensive growth stocks while maintaining higher upside potential than pure value plays, ensuring a disciplined approach to long-term capital appreciation within the domestic landscape.

The Global X S&P Australia GARP ETF (GRPA) provides investors with exposure to leading Australian companies with strong earnings growth, solid financial strength, and trading at reasonable valuations. These characteristics are common when describing stocks that meet the definition of an investing strategy known as Growth at a Reasonable Price (GARP). 

The Global X S&P Australia GARP ETF seeks to provide investors with a return that (before fees and expenses) tracks the performance of the S&P/ASX 200 GARP Index.

• The origins of GARP can be traced back to legendary investors like Peter Lynch, who popularised the strategy in the 1980s. Lynch’s success with the GARP approach led his fund returning on average 29% p.a. making it the best-performing mutual fund in the world during his tenure.¹
• Research has found that Australian companies with strong earnings growth and high returns on equity tend to outperform weaker peers.² An Australian GARP investing strategy has outperformed the broader Australian share market over 90% of the time, with an average excess return of ~3% p.a.³

¹ Nasdaq (March 2014): How Peter Lynch Earned 29% a Year for 13 years

² S&P Dow Jones Indices (September 2024): Bridging Value and Growth: Designing a GARP Strategy for Australia

³ Source: S&P Dow Jones Indices, FactSet as of 30 June 2025. Outperformance is based on the excess return of the S&P/ASX 200 GARP Index vs the S&P/ASX 200 Index. Past performance is not a reliable indicator of future performance. 

• GRPA can serve as a blended core Australian equity strategy in portfolios, effectively balancing growth and value across different market cycles, that can be used in conjunction with a traditional Australian equity exposure.
• To access 50 quality Australian companies across a broad range of sectors that have grown their revenue and earnings, but aren’t too expensive relative to their growth.
• A lower-cost and transparent alternative to traditional actively managed Australian equity funds. ¹

¹ Morningstar using the average fee of actively-managed Australian Equity Managed Funds.

The Global X S&P Australia GARP ETF (GRPA) tracks the S&P/ASX 200 GARP Index, which measures the performance of the top 50 Australian companies that exhibit GARP characteristics. This includes filtering the broader investment universe based on multiple factors, such as:

• Growth – Sales and Earnings Growth
• Value – Price to Earnings (PE) ratio
• Quality – Return on Equity (ROE)

Each company’s weight is calculated by multiplying its Float Market Capitalisation by its Quality and Value score, with a maximum security weight of 10% and sector cap of 10% above the S&P/ASX 200 Index. The index is rebalanced semi-annually, and distributions are paid semi-annually.

GARP investing may pose some risk, as the market cycle can impact the performance of GARP stocks. During periods of extreme market optimism, high-growth stocks may outperform, potentially leaving GARP investors with relatively modest gains. Expensive stocks may keep getting more expensive if multiple expansion continues.

Conversely, in a downturn, the value component of GARP can provide some downside protection, but it may not be as defensive as pure value stocks or defensive assets. While GRPA has a 10% cap on individual security weights, investors should be aware that the top 10 holdings may represent a larger concentration than the broader Australian market.

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Issued by Global X Management (AUS) Limited (‘Global X’) (AFSL 466778, ACN 150 433 828). This is general information only and not personal advice. This communication doesn’t consider your personal circumstances or needs. Investors should consider whether Global X products are appropriate for them, obtain financial advice and read the disclosure statement (PDS) and target market determination (TMD) before making investment decisions. All PDSs and TMDs are available on our website: www.globalxetfs.com.au. Investment in any products issued by Global X is subject to risks, including possible delays in repayment and loss of income and principal invested. Past performance is not a reliable indicator of future performance. This content may not be reproduced, distributed or published by any recipient for any purpose. Global X nor any of its affiliates make any warranty as to the accuracy of any data used or displayed in this communication or to the performance of any product.