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  • FIRST POST
    • ian-d
    • By ian-d 15th May 17, 2:24 PM
    • 367Posts
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    ian-d
    Alternatives to Vanguard LifeStrategy
    • #1
    • 15th May 17, 2:24 PM
    Alternatives to Vanguard LifeStrategy 15th May 17 at 2:24 PM
    So I've started my SIPP on VLS80, high risk, but it will be contributed to for a good 20 years at least; regularly, so buying high and low.

    I'm going to drip feed approx. £5k into a S&S ISA from my CASH ISA for the next 12-24 months, though I'm unsure if I should just use the same fund option, or whether to explore other alternatives on the basis of the pot being much larger in the short term, but with a view to investing over a lesser period of 15 years.

    Should I be considering other funds? Or looking at VLS60 or even VLS100 instead? Any suggestions?

    (not factoring in a LISA just now, I don't want to tie in more than just a SIPP for now...which is a better option for me as the contributions are via my ltd company)
Page 1
    • bostonerimus
    • By bostonerimus 15th May 17, 2:37 PM
    • 506 Posts
    • 248 Thanks
    bostonerimus
    • #2
    • 15th May 17, 2:37 PM
    • #2
    • 15th May 17, 2:37 PM
    Why are you thinking about other funds? Are you unhappy with the fees or asset mix of VLS80?
    • ian-d
    • By ian-d 15th May 17, 3:03 PM
    • 367 Posts
    • 87 Thanks
    ian-d
    • #3
    • 15th May 17, 3:03 PM
    • #3
    • 15th May 17, 3:03 PM
    Why are you thinking about other funds? Are you unhappy with the fees or asset mix of VLS80?
    Originally posted by bostonerimus
    Not at all, I'm actually a big fan of the Vanguard LS funds; I'm just not sure if the same fund in another product makes a lot of sense or not, and whether my approach should be different to a S&S ISA on a slightly lesser timescale than a SIPP on a longer term view. It is also the thought that I should be covering off other asset mixes?
    • bostonerimus
    • By bostonerimus 15th May 17, 3:38 PM
    • 506 Posts
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    bostonerimus
    • #4
    • 15th May 17, 3:38 PM
    • #4
    • 15th May 17, 3:38 PM
    What other assets do you want to include in your portfolio....VLS funds are very diversified. You should look at all your accounts and make sure your overall asset allocation is what you want. You can have certain assets in certain accounts ie cash should not go into a pension fund. I too often see people thinking that by having more funds they have a better portfolio (VLS is composed of several tracker funds anyway) and that's just not the case......keep it simple and keep fees low.
    • chockydavid1983
    • By chockydavid1983 15th May 17, 3:49 PM
    • 395 Posts
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    chockydavid1983
    • #5
    • 15th May 17, 3:49 PM
    • #5
    • 15th May 17, 3:49 PM
    I have a mix of VLS 100 and VLS 20, which will reduce equity exposure over time and the next thing I'm going to add is Vanguard Global Small Cap Index as VLS in more large and mid cap.
    I might also top up the emerging markets allocation and add commercial UK property at some point too.

    But, I also echo what has been said above that VLS is very diversified already.
    • ian-d
    • By ian-d 15th May 17, 4:33 PM
    • 367 Posts
    • 87 Thanks
    ian-d
    • #6
    • 15th May 17, 4:33 PM
    • #6
    • 15th May 17, 4:33 PM
    This is partly the reason for my question. Looking at an investment period of potentially 15 years on this S&S ISA, taking me to just before my retirement target, I wonder if I can include other funds that cover areas that the VLS products don't. So Global Small Caps is certainly one of them, and maybe some funds in Indian as an emerging market; plus anything else that may be considered a nice balance to have?

    Fundsmith Equity appeals too, though I suspect I'm being seduced by the returns in the last 5 years on what appears to just be a fund focused on trading of specific company shares.

    The majority of my money will still go into Vanguard LifeStrategy funds; I'm not sure anyone would be able to advise whether that should be VLS60 or VLS80 to compliment my SIPP.
    • pinkllama
    • By pinkllama 15th May 17, 5:51 PM
    • 84 Posts
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    pinkllama
    • #7
    • 15th May 17, 5:51 PM
    • #7
    • 15th May 17, 5:51 PM
    Taking the timeframe into account i would go 100% equities on the SIPP and something lower on the ISA
    You seem to want to tinker with allocations.
    Check out the Vanguard FTSE Global All-Cap fund. 4600 large/mid/small cap companies. 9% emerging markets. 0.24%
    I would personally resist the temptation to add other funds, you may well end up constantly thinking about what to buy/when to buy/when to sell.
    You could get by with the above fund for the SIPP and Lifestrategy 60 or 80 for the ISA - which you may need or decide to dip into earlier than planned.
    • Broken Biscuits
    • By Broken Biscuits 15th May 17, 6:17 PM
    • 326 Posts
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    Broken Biscuits
    • #8
    • 15th May 17, 6:17 PM
    • #8
    • 15th May 17, 6:17 PM
    Legal & general multi index funds are an alternative to vanguard lifestrategy.
    If you consider USA is overpriced but still want a one stop purchase, you may find their allocations more appealing and less USA weighted.

    Do your own research, obviously.
    • bostonerimus
    • By bostonerimus 15th May 17, 7:04 PM
    • 506 Posts
    • 248 Thanks
    bostonerimus
    • #9
    • 15th May 17, 7:04 PM
    • #9
    • 15th May 17, 7:04 PM
    Throughout my investing I've been roughly 60/40....that goes from 1987 to today and it's worked out well enough for me. I worry when people start slicing and dicing their allocations to include "bits of this and bits of that" in an effort to not miss sectors that might be big gainers. Remember you should not be looking to maximize your potential gains, you should be maximizing the probability of investment success. If success is getting 5% or 6% annual return so you'll have enough to retire then you should have an asset allocation that reflects that return and risk level.

    If you want some small allocation to global small cap and the fees are low then go ahead, but IMHO it's really more of a distraction than a useful diversification if you own something like VLS60.
    • chockydavid1983
    • By chockydavid1983 15th May 17, 9:52 PM
    • 395 Posts
    • 224 Thanks
    chockydavid1983
    I plan to be 60/40 at some point but right now I'm about 75/25 in my ISA and 100/0 in my SIPP.
    If you want a set and forget solution then VLS only will be fine. Otherwise, sure add extra funds but be wary about charges (VLS Global Small cap is passive and low cost) and that you're actually diversifying away from VLS, which in theory gives you a better probability of success long term.
    Whether you go 60 or 80 is more about your psychology than anything. Higher proportion of equities is likely to perform better over the long term but also with more peaks and troughs. If you think you can handle that, go 80 or maybe even 100 but if you'd panic sell and lose money, you maybe better of going with 60.
    Last edited by chockydavid1983; 15-05-2017 at 9:55 PM.
    • ian-d
    • By ian-d 16th May 17, 10:03 AM
    • 367 Posts
    • 87 Thanks
    ian-d
    I'm certainly happy enough with VLS80 in my SIPP; it offers a great amount of risk, but a bit of protection against 100% equities; plus will be in for a good 20 years, so by that point, either it has worked out on both, or worked out on neither.

    I'm currently taking a view that I might use VLS60 on my S&S ISA, which will have a much greater pot earlier on, but with a view to investing over a slightly shorter timescale, to become part of the initial drawdown and then trickle the SIPP to avoid where possible too much tax liability. Combined with VLS60, I may consider a small cap fund too, but balanced so not to impact too greatly on the 60% equity ratio.
    • roxy28
    • By roxy28 17th May 17, 12:05 PM
    • 598 Posts
    • 57 Thanks
    roxy28
    Which Legal & General multi index class is around the same risk/level as the VLS60.


    Legal & General Multi Index 3 (Class I) (Acc)












    Legal & General Multi Index 3 (Class I) (Inc)




    Legal & General Multi Index 4 (Class I) (Inc)




    Legal & General Multi Index 4 (Class I) (Acc)




    Legal & General Multi Index 5 (Class I) (Inc)




    Legal & General Multi Index 5 (Class I) (Acc)




    Legal & General Multi Index 6 (Class I) (Acc)




    Legal & General Multi Index 6 (Class I) (Inc)




    Legal & General Multi Index 7 (Class I) (Acc)



    Legal & General Multi Index 7 (Class I) (Inc)
    Last edited by roxy28; 17-05-2017 at 12:12 PM.
    • eskbanker
    • By eskbanker 17th May 17, 12:16 PM
    • 5,005 Posts
    • 4,756 Thanks
    eskbanker
    Depends who's measuring the risk and how, but, for example, the view from Trustnet is that VLS60 is a 57 on their scale, with L&G 5 at 54 and L&G 6 at 67.
    • ColdIron
    • By ColdIron 17th May 17, 12:30 PM
    • 3,191 Posts
    • 3,632 Thanks
    ColdIron
    You don't need to differentiate between the Acc and Inc classes as regards risk, they are the same underlying fund
    • roxy28
    • By roxy28 17th May 17, 2:21 PM
    • 598 Posts
    • 57 Thanks
    roxy28
    Ok thanks for the replies,

    L&G 5 Acc looks good.
    • principa
    • By principa 17th May 17, 3:06 PM
    • 63 Posts
    • 18 Thanks
    principa
    Vanguard have a retirement funds now that derisks as you age - so you start off at 80/20 and end up 20/80- could be an option?
    • roxy28
    • By roxy28 18th May 17, 1:55 PM
    • 598 Posts
    • 57 Thanks
    roxy28
    The L&G Multi index 5 has a higher ongoing charge of 0.31% against 0.22% with the VLS60, so the L&G 5 will have to do better over time to compensate?
    Last edited by roxy28; 18-05-2017 at 2:09 PM.
    • Linton
    • By Linton 18th May 17, 2:39 PM
    • 7,970 Posts
    • 7,775 Thanks
    Linton
    The L&G Multi index 5 has a higher ongoing charge of 0.31% against 0.22% with the VLS60, so the L&G 5 will have to do better over time to compensate?
    Originally posted by roxy28
    Note that published performance always includes the effect of fund charges.

    Differences in what the funds invest in will have a much larger effect than 0.09% in charges. In each of the past 3 years the returns were:

    VLS 60: 20.2%,1.0%,11.4%
    L&G 5: 17.4%, -0.7%, 11.7%

    The figures dont tell you one fund is better than another - for example it could well be that the L&G fund is a bit more cautious or has a different geographic allocation.
    • Sally57
    • By Sally57 18th May 17, 2:47 PM
    • 66 Posts
    • 15 Thanks
    Sally57
    Another good alternative to VLS and L&G is the HSBC Global Strategy range of funds. They are cheap and performed well in comparison to the other two. It has less holdings in the UK which with Brexit some people believe is good? It's just another option for research.
    • roxy28
    • By roxy28 18th May 17, 4:22 PM
    • 598 Posts
    • 57 Thanks
    roxy28
    Another good alternative to VLS and L&G is the HSBC Global Strategy range of funds. They are cheap and performed well in comparison to the other two. It has less holdings in the UK which with Brexit some people believe is good? It's just another option for research.
    Originally posted by Sally57
    Note that published performance always includes the effect of fund charges.

    Differences in what the funds invest in will have a much larger effect than 0.09% in charges. In each of the past 3 years the returns were:

    VLS 60: 20.2%,1.0%,11.4%
    L&G 5: 17.4%, -0.7%, 11.7%

    The figures dont tell you one fund is better than another - for example it could well be that the L&G fund is a bit more cautious or has a different geographic allocation.
    Originally posted by Linton
    Ok thanks,i will also look at the HSBC option if i can gauge the same risk level as the other 2
    Last edited by roxy28; 18-05-2017 at 4:25 PM.
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