Vanguard direct to customer offering confirmed
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Good news, this, albeit too expensive for me as it is.
A well calculated charge - expect it to drop, with fanfare, 3 or 4 times a year for the next 3 or 4 years.0 -
TheTracker wrote: »Good news, this, albeit too expensive for me as it is.
A well calculated charge - expect it to drop, with fanfare, 3 or 4 times a year for the next 3 or 4 years.
We can always dream but if it happens then great!0 -
Glen_Clark wrote: »Slightly off topic but its a good question, because cheaper brands have come out better in blind taste tests.
Present kids with cereal boxes etc and they pick the brand leader. Present them with the unwrapped product and they usually don't.
That might be because many cheaper brands have more sugar, which appeals to kids. Generally brands are better quality, but there are exceptions. M&S and Waitrose own brands are often better, and surprisingly Aldi produce can be very good indeed, and better than known brands, but it can also be worse.
Anyway, I ignore taste tests, as I find I usually have different tastes. After all, most people can eat Mars bars, but I find them inedible.0 -
bostonerimus wrote: »I did not mean to say that you did not actually end up on the plus side of the market, just that forums and not places for absolute rigor.
The average person will not have the knowledge (I'd still ascribe a lot of luck) to consistently choose the right funds and make the right trades.
I don't doubt that you are right. That is why mediocre funds continue to sell. But also many are in pension funds, recommended by advisors paid for by companies as part of the compensation package.bostonerimus wrote: »Undoubtedly there are people who have long track records of success and there are also those with long track records of failure, but some in the middle and the difficulty comes in backing the right horse at the right time and for the average investor it's simply not worth it.
My experience is that it is quite easy. And if someone does not want to spend time learning, then they can hire an IFA to do the leg work for them. Yes that adds an overhead, but I suspect it is worth it. Those here with experience of funds managed by an IFA are better placed to comment on that.bostonerimus wrote: »Given the historical lack of low cost index funds in the UK you last sentence has a ring of truth about it. There hasn't been much time or data to compare active vs passive in the UK, but with low cost tracker options now readily available I expect to see studies and that the results will mirror those of the US.
Actually UK index funds have been around for decades. They were very trendy under Blair, who tried to ban advertising based on past performance. There is plenty of evidence that UK active funds do better than US ones relative to trackers in their respective markets.0 -
I would prefer index trackers but as I am now retired and looking for income as well as growth I was going to select a diverse group of income funds for 50% of my portfolio. What is the best things to look for when researching funds and ITs to ensure you don't end up with mediocre funds?BananaRepublic wrote: »I don't doubt that you are right. That is why mediocre funds continue to sell.0 -
I would prefer index trackers but as I am now retired and looking for income as well as growth I was going to select a diverse group of income funds for 50% of my portfolio. What is the best things to look for when researching funds and ITs to ensure you don't end up with mediocre funds?
At the risk of stating the obvious, do be aware that there is always the risk with stock market investments that a crash will occur, and to avoid crystallising losses, you will have to keep them in the market for longer than intended, waiting for the recovery.
The way I research funds is simply to look at long term performance over 5 and 10 years. I look for not only high performance, but consistency. Thus a fund might have a high value to to one outstanding year, and many mediocre years. That suggests luck might have played a role in the outstanding year. Consistent performance suggests an underlying soundness.
Of course you also have to select sectors, and it is advisable to spread money across mutiple sectors, such as US, UK and Europe, and multiple funds in those sectors, in order to reduce risk. Different regions will behave differently, thus Far Eastern markets tend to be more volatile, but can offer high gains, and then there are the emerging markets.
Incidentally, since you prefer trackers, you could always go for an income tracker.0 -
They did a segment on the Vanguard Launch.
http://www.bbc.co.uk/programmes/b08qxd06
About 10 minutes into the program.
Sean Hagerty from Vanguard speaks.
Moneybox interviewed John Bogle in 2016:
http://www.bbc.co.uk/programmes/b081qyxh
Isn't mutualism like communism? How did he not get lynched in America?0 -
I would prefer index trackers but as I am now retired and looking for income as well as growth I was going to select a diverse group of income funds for 50% of my portfolio. What is the best things to look for when researching funds and ITs to ensure you don't end up with mediocre funds?
- Focus on geting as broad a coverage as possible of types of asset (bonds/property/equity/ anything else you can find), geographies, industries, company sizes in your overall portfolio. There is good income to be achieved outside the UK as well as inside.
- you should aim for every fund having a clear and unique purpose.
- look at performance data in order of priority:
- - consistency
- - least bad performance in the bad times - trustnet charting can show you details of the 2008 crash.
- - high performance overall
- avoid new funds
- avoid very small funds
Trackers generally are not particularly good for income. For equity income investing you need:
- underlying holdings in companies that generate sufficient consistent profit to support a long term high dividend yield.
- to avoid companies that are showing a high dividend yield because their share price has crashed.
- to achieve good diversification across sectors.
In my view this sort of filtering needs human intervention.
For an example of how things can go terribly wrong I suggest you investigate what happened to the iShares UK Dividend ETF (IUKD) during the 2008 crash. It dropped around 70% from its maximum attained a few months previously. Even with dividends reinvested it only passed its pre 2008 maximum around late 2014. If you had taken dividends as income you would still be about 30% down on capital value.0 -
I know it's a minority of posters who are having an extended argument about passive vs. active, but could we possibly drop it and return to discussing Vanguard's D2C offering?
I have requested a transfer of my daughter's small JISA (we hold most of her money in adult ISAs) and it was an entirely painless experience. Very clear forms, smooth process and just the right amount of communication. A good start.0 -
Thanks Linton, that is very helpful. I have also been looking at things like the Money Observer magazine's list of Rated Funds which are detailed in a separate Fund Choices magazine. They are helpfully split in sectors and have risk factors etc. I assume these funds will have been subject to the sort of research you are talking about? As I'm looking to transfer fairly large sums from Virgin and Cash ISAs is it reasonable to trust their judgement along with Trustnet and Morningstar ratings and select what I consider the best funds from each sector to give me good diversification?- Focus on geting as broad a coverage as possible of types of asset (bonds/property/equity/ anything else you can find), geographies, industries, company sizes in your overall portfolio. There is good income to be achieved outside the UK as well as inside.
- you should aim for every fund having a clear and unique purpose.
- look at performance data in order of priority:
- - consistency
- - least bad performance in the bad times - trustnet charting can show you details of the 2008 crash.
- - high performance overall
- avoid new funds
- avoid very small funds
Trackers generally are not particularly good for income. For equity income investing you need:
- underlying holdings in companies that generate sufficient consistent profit to support a long term high dividend yield.
- to avoid companies that are showing a high dividend yield because their share price has crashed.
- to achieve good diversification across sectors.
In my view this sort of filtering needs human intervention.
For an example of how things can go terribly wrong I suggest you investigate what happened to the iShares UK Dividend ETF (IUKD) during the 2008 crash. It dropped around 70% from its maximum attained a few months previously. Even with dividends reinvested it only passed its pre 2008 maximum around late 2014. If you had taken dividends as income you would still be about 30% down on capital value.
I can't go that far wrong by that method, or can I?0
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