Want to beat the market? Try these 2 ASX ETFs

The Australian share market has delivered wealth-building returns for decades. As we covered last year, long-term investors would have been far better off investing (through an ASX exchange-traded fund (ETF)) in the S&P/ASX 200 Index (ASX XJO) than if they had bought government bonds, or even worse, left their money in the bank.

Most investors who buy individual ASX stocks have beating ‘the market’, represented by an ASX 200 index fund, as one of their goals. But this is easier said than done. Even professional investors can struggle to outperform the ASX 200 over long stretches of time.

But there might be a shortcut that investors wanting the best returns can exploit. So today, let’s look at two ASX ETFs that have historically delivered returns that have well-exceeded the Australian share market.

For some context, the iShares Core S&P/ASX 200 ETF (ASX: IOZ), the largest ASX 200 index fund on the ASX, returned 10.36% over the 12 months to 31 December 2025 (including dividend distributions). It has averaged 11.31% per annum over the past three years, 9.83% per annum over the past five, and 9.2% over the past ten.

2 market-beating ASX ETFs to consider

First up, we have the BetaShares Global Cash Flow Kings ETF (ASX: CFLO). This fund holds a portfolio of global companies that are selected based on levels of free cash flow that they consistently generate. These stocks, according to the provider, “have historically tended to outperform broad global equity benchmarks over the medium to long term”.

Some of CFLO’s current holdings include Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL), Costco Wholesale Corp (NASDAQ: COST), Visa Inc (NYSE: V) and Johnson and Johnson (NYSE: JNJ).

This ETF has only been around since November 2023. However, the index that it tracks has been around a lot longer, meaning we can still analyse its performance against the ASX 200. Over the three years to 31 December, this index has returned an average of 10.14% per annum, extending 0 14.68% per annum over the past five years, and 13.61% over ten. Those metrics handily beat out the Australian share market.

Next, let’s check out the BetaShares Global Royalties ETF (ASX: ROYL). This is a rather unique ASX ETF in that it holds a portfolio of global companies that earn a substantial portion of their revenues from royalty payments. Depending on the stock, those royalties could come from mines, intellectual property like music streaming, or financial deals.

Some of ROYL’s current largest holdings include Wheaton Precious Metals Corp (NYSE: WPM), Texas Pacific Land Corp (NYSE: TPL)  and Universal Music Group N.V.

This ASX ETF has returned an average of 15.38% over the three years to 31 December 2025. The index that it tracks has delivered a return of 19.81% per annum over the past five years, making it another ASX 200 market beater.

The post Want to beat the market? Try these 2 ASX ETFs appeared first on The Motley Fool Australia.

More reading

• Why these ASX ETFs could be perfect to buy and hold forever
• 3 ASX ETFs to buy and hold until 2036
• These ASX ETFs could be top passive income picks
• 3 ASX ETFs that could be perfect for beginner investors in 2026
• 3 strong ASX ETFs to buy for passive income

Motley Fool contributor Sebastian Bowen has positions in Alphabet, Costco Wholesale, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Costco Wholesale, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson. The Motley Fool Australia has recommended Alphabet and Visa. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.