Vanguard direct to customer offering confirmed
Comments
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In the US too, if the blogs I've read are any guide.bostonerimus wrote: »There is still as nasty perception in the UK that you can regularly buy market beating performance by paying extra for an actively managed fund.Eco Miser
Saving money for well over half a century0 -
Some nice touches: no fee to transfer funds out and no exit charges.koru0
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There is still as nasty perception in the UK that you can regularly buy market beating performance by paying extra for an actively managed fund.
Mainly as it is true in the UK. One of the few countries where that is the case. Unlike many other countries where passive is better.
Most of the passive vs managed research comes from the US and cannot be applied to the UK directly. In the US it does make sense to be in passive.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
I'm currently with Fidelity for my S&S ISA's but mainly hold active funds in my portfolio so really the Vanguard platform at present is no use to me, however I am looking into switching to a fee based platform such as Halifax/IWeb.
Most people who hold some active funds and also have a decent size investment portfolio will still be better off with a flat fee based platform such as Halifax etc. rather than any percentage based platform even at 0.15%.0 -
Most people who hold some active funds and also have a decent size investment portfolio will still be better off with a flat fee based platform such as Halifax etc. rather than any percentage based platform even at 0.15%.
Are we talking cross purposes here, mixing the Annual Management Charge of the Fund with the Platform Fee of who you hold the account with, ie. Hargreaves, TD, Halifax etc. ?
Also, it looks like the Halifax may charge less than say HL on the Annual Fee via a Flat Rate, but looking at their Trade Charges (applied to ALL investment options?) they pull your pants down on a Buy or Sell in a mutual fund @ £12.50 per deal ... so a switch charges you on the Buy AND Sell leg !?
Other platforms are free for Fund Dealing.
So, I guess if you aren't a Frequent Trader, it isn't so bad ...0 -
That's a big assertion. I agree that there's more research into the US market than in relation to the UK, but I wasn't aware of any rigorous analysis that demonstrates that the UK is any better endowed with managers who can reliably outperform the market than elsewhere. I don't want to go off topic here, and turn this into another debate on passive v active. No doubt you have explained the basis for this comment on other threads, so can you direct me to them? I'll comment there, if necessary.Mainly as it is true in the UK. One of the few countries where that is the case. Unlike many other countries were passive is better.
Most of the passive vs managed research comes from the US and cannot be applied to the UK directly. In the US it does make sense to be in passive.koru0 -
bostonerimus wrote: »I hope Vanguard's move will highlight the basic Bogle rule of keeping fees to a minimum. There is still as nasty perception in the UK that you can regularly buy market beating performance by paying extra for an actively managed fund. That will work for some people in some years, but some active funds will lag the market and for the majority of investors a low cost tracker approach is the best way to go. I've been investing with Vanguard in the US for the last 20 years and the fees on my funds range from 0.04% to a max of 0.12%. Those are my only fees. I've usually kept a roughly 60/40 asset allocation........although I'm now letting the equity percentage drift up and I'm close to 70/30. Over my 30 years of investing by sticking to a 60/40 asset allocation in tracker funds I've averaged 8% annual return. So by doing not much other than following a few simple rules, and having a low cost lifestyle, I was able to retire debt free at age 52.
- There's a difference between Fund Charges and Platform Fees.
- With Platform Fees, you typically get what you pay for.
- HL are one of the most expensive Platforms, but Customers flock to them because of the Customer Service offering.
- They may be your only Fees in the US, but its standard market practice in the UK for the Platform Provider to charge you a Fee now we are in the post RDR world where Ongoing Fees are no longer paid to the Platform direct by the Fund Provider, to give pure transparency to Customers as to the charges they're paying - rather than it coming out your AMC of the asset and most investors being clueless that their Advisors put them in particular funds due to the healthy levels of Ongoing Commission that asset paid.
- Unsure of the rationale behind your 60:40 allocation, but its also good to build a Cash element into your Portfolio to cover Fees. That prevents the disinvestment of assets out the market to cover your Fees - which HL will charge you a Fee on too - and no one like paying a Fee to pay a Fee!
- Congrats on retiring at 52, I hope you're relaxing on a beach somewhere with a nice view watching your investments rise in the Bull Market.0 -
- There's a difference between Fund Charges and Platform Fees.
- With Platform Fees, you typically get what you pay for.
I know there's a difference. In the US Vanguard has no platform fees and no trading fees for Vanguard funds. US Vanguard service and tools is excellent....I hope that will be the case in the UK too.- HL are one of the most expensive Platforms, but Customers flock to them because of the Customer Service offering.
US Vanguard is inexpensive and gives great service...let's hope that start to happen in the UK too.
Yep, I'd hate to have to invest in the UK as it can be a real a rip off.- They may be your only Fees in the US, but its standard market practice in the UK for the Platform Provider to charge you a Fee now we are in the post RDR world where Ongoing Fees are no longer paid to the Platform direct by the Fund Provider, to give pure transparency to Customers as to the charges they're paying - rather than it coming out your AMC of the asset and most investors being clueless that their Advisors put them in particular funds due to the healthy levels of Ongoing Commission that asset paid.- Unsure of the rationale behind your 60:40 allocation, but its also good to build a Cash element into your Portfolio to cover Fees. That prevents the disinvestment of assets out the market to cover your Fees - which HL will charge you a Fee on too - and no one like paying a Fee to pay a Fee!
My allocation is based on an efficient frontier for retirement investing balancing risk and return......now that I have guaranteed income from a pension I'm actually taking more risk in the portfolio and letting the percentage of stocks increase.- Congrats on retiring at 52, I hope you're relaxing on a beach somewhere with a nice view watching your investments rise in the Bull Market.
Well that's right apart from the beach.....but I'm often on my porch drinking a beer“So we beat on, boats against the current, borne back ceaselessly into the past.”0 -
As you might imagine, after this forum has been running for over a decade there are literally hundreds of existing threads with thousands of posts that refer to the "active vs passive debate" in some way. Some populated by evangelists and some by moderates. Most people recognise that passive can be best for some areas and strategies and in other areas passives are less useful or do not even have a suitable index in which to invest.That's a big assertion. I agree that there's more research into the US market than in relation to the UK, but I wasn't aware of any rigorous analysis that demonstrates that the UK is any better endowed with managers who can reliably outperform the market than elsewhere. I don't want to go off topic here, and turn this into another debate on passive v active. No doubt you have explained the basis for this comment on other threads, so can you direct me to them? I'll comment there, if necessary.
The US with one of the most efficient markets in the world is a good place to push passives. Also, passives have an advantage there because you pay taxes on the realised gains made inside mutual funds when the fund manager exits a position, whereas in the UK you typically do not, only when you actually dispose of your share in the fund as an investor in it. So, an actively managed fund in the US has a disadvantage compared to one that is more "passive, buy and hold with minimal churn", not just in terms of a US passive manager having a few basis points of trading costs saved, but also a chunk of tax saved. That sort of advantage is not felt by UK passive managers.
In the UK, our main stock index the FTSE100 (which is itself over 80% of the FTSE all share) is a terrible index with high concentration in certain industries that dominate that market cap weighted index. So, active can improve diversification across market cap and industry. In the US, the S&P500 and Russell indices are more balanced in terms of mix.
So, investing is not one size fits all, around the world.0 -
I don't see what incentive Vanguard will have to branch out and offer investment products from others, does any one have info that's their intent?
As an outfit that pride themselves on keeping costs as low as possible I suspect all they're doing is offering direct affordable access to their own products and in house services, without the need to stump up a six figure lump sum.
I don't have any inside info, but I would be very surprised if Vanguard offered anything other than Vanguard products."If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes” Warren Buffett
Save £12k in 2021 - #027 £15,268 (76%)0
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