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  • FIRST POST
    • darkidoe
    • By darkidoe 30th Nov 17, 10:09 PM
    • 896Posts
    • 1,022Thanks
    darkidoe
    Transferred Vanguard Funds
    • #1
    • 30th Nov 17, 10:09 PM
    Transferred Vanguard Funds 30th Nov 17 at 10:09 PM
    Hi

    I have recently made the transfer out from TD to IG platform.

    I noticed that 2 of my ETFs were transferred to the wrong ETF.
    VAPX was transferred as VDPX fund (USD denominated)
    VUSA was transferred as VUSD fund (USD denonimated)

    A quick search reveals that they are both still London Stock Exchange listed. But given that I wanting to avoid potential FX fees, I am looking to correct this mistake.

    Is this quite a common error or is it routinely transferred this way?

    Save 12K in 2017 # 9 £11,119.65/15 000 (74%)
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Page 1
    • dunstonh
    • By dunstonh 30th Nov 17, 11:14 PM
    • 89,941 Posts
    • 56,636 Thanks
    dunstonh
    • #2
    • 30th Nov 17, 11:14 PM
    • #2
    • 30th Nov 17, 11:14 PM
    Which method of transfer did you select? Re-registration or cash transfer?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • darkidoe
    • By darkidoe 1st Dec 17, 1:12 AM
    • 896 Posts
    • 1,022 Thanks
    darkidoe
    • #3
    • 1st Dec 17, 1:12 AM
    • #3
    • 1st Dec 17, 1:12 AM
    Which method of transfer did you select? Re-registration or cash transfer?
    Originally posted by dunstonh
    It was a S&S ISA transfer. Stock transfer.

    Edit:
    I checked they have the similar ISIN similar but different SEDOL Identifiers.

    VAPX
    ISIN: IE00B9F5YL18
    SEDOL: B9MSLC3

    VDPX
    ISIN: IE00B9F5YL18
    SEDOL: B94JY69

    VUSA
    ISIN: IE00B3XXRP09
    SEDOL: B7NLLS3

    VUSD
    ISIN: IE00B3XXRP09
    SEDOL: B7NLJN4

    General trends of the charts seems similar but variance differs probably due to currency fluctuations. I wonder what the long term implications of being invested in different currencies in the same fund would be.
    Last edited by darkidoe; 01-12-2017 at 1:43 AM.

    Save 12K in 2017 # 9 £11,119.65/15 000 (74%)
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    • bowlhead99
    • By bowlhead99 1st Dec 17, 7:27 AM
    • 7,000 Posts
    • 12,612 Thanks
    bowlhead99
    • #4
    • 1st Dec 17, 7:27 AM
    • #4
    • 1st Dec 17, 7:27 AM
    General trends of the charts seems similar but variance differs probably due to currency fluctuations.
    Originally posted by darkidoe
    If you draw one chart in dollars and one in sterling, they will be moving up and down relative to each other as your return in dollars will differ from your return in sterling. For example FTSE100 total return over the 3 years to end of October was 28.5% in pounds sterling but if you did the chart in dollars it would only be 6.6%.

    So, if you bought a tracker fund priced in one currency instead of the other, the price change percentage would look quite different. But both of them would give you exposure to HSBC, BAT, BP, Shell etc in the same ratios so your total return is going to be the same, no matter what currency you use to keep score.

    If you translate every price to the same currency and draw both charts in that currency you will see they are basically the same.

    With each of the two Vanguard funds you mention, they do the fund accounting and valuation in dollars and pay dividends in dollars. But you will find the ETF offered on the stock market priced in dollars OR sterling. The published price is a way to keep score in the currency of your choice. Imagine if you are a Euro investor. You could buy the GBP version and translate your result back to Euro or the USD version and translate your result back to Euro, you will get the same amount of Euro (assuming your broker has the same percentage rate of commission for translating USD to Euro as he does for translating GBP to Euro).

    If you have a dollar account with the broker containing USD cash it would be more sensible to buy the dollar one so your broker doesn't charge you an FX loading commission on the purchase; and similarly if you have a GBP account (such as an ISA, which can't hold foreign currency cash) it would be more sensible to use the GBP one.

    However, it might be that the USD one is more popular and liquid so it is practically easier and more efficient to use the USD one due to lack of availability of the GBP instrument when you get a price quote to buy or sell. With IG the fx loading they charge is only 0.3% anyway. Both pricing versions still physically pay their dividends in USD and if you have an ISA account that USD income will have to be converted to sterling by the receiving broker anyway due to HMRC rules, you can't do anything about that bit.

    I wonder what the long term implications of being invested in different currencies in the same fund would be.
    You are not really 'invested in' different currencies - even if you subscribe to a new issue of shares, when Vanguard receive the money they convert it if necessary into the currency they need and deploy it into the exact same assets such as Samsung or Tencent shares or whatever - with Vanguard's buying power having millions of currency to change at once, the transaction would be pretty close to spot rate. So, not too much of a drag from using GBP version over the more 'pure' USD version ; USD is only an accounting currency anyway, because the Samsung shares are bought in Korean Won and the Tencent shares are bought in Hong Kong Dollars. If the GBP share class is unpopular and illiquid then there could be a greater spread between the bid and offer prices than on the dollar version's share prices, giving an inherent extra 'cost' of using that GBP class.
    Last edited by bowlhead99; 01-12-2017 at 7:30 AM.
    • Economic
    • By Economic 1st Dec 17, 9:06 AM
    • 152 Posts
    • 107 Thanks
    Economic
    • #5
    • 1st Dec 17, 9:06 AM
    • #5
    • 1st Dec 17, 9:06 AM
    Hi

    I have recently made the transfer out from TD to IG platform.

    I noticed that 2 of my ETFs were transferred to the wrong ETF.
    VAPX was transferred as VDPX fund (USD denominated)
    VUSA was transferred as VUSD fund (USD denonimated)

    A quick search reveals that they are both still London Stock Exchange listed. But given that I wanting to avoid potential FX fees, I am looking to correct this mistake.

    Is this quite a common error or is it routinely transferred this way?
    Originally posted by darkidoe
    Why don't you contact IG and tell them that they are the wrong ETF?
    • dunstonh
    • By dunstonh 1st Dec 17, 12:57 PM
    • 89,941 Posts
    • 56,636 Thanks
    dunstonh
    • #6
    • 1st Dec 17, 12:57 PM
    • #6
    • 1st Dec 17, 12:57 PM
    Has the re-registration actually happened yet?

    It may be that the new platform is showing you the values of what they think they are getting re-registered to them. When the re-registration actually happens (which can be 1 week to 6 months in timescale) the data is updated with what they actually are.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • darkidoe
    • By darkidoe 2nd Dec 17, 12:16 AM
    • 896 Posts
    • 1,022 Thanks
    darkidoe
    • #7
    • 2nd Dec 17, 12:16 AM
    • #7
    • 2nd Dec 17, 12:16 AM
    Thanks for the replies. Very well explained Bowlhead!

    Yes I have emailed IG regarding this, waiting to hear back.

    Not quite sure how I can figure out if the re-registration has happened or not other than looking up my portfolio shown online on the platform.

    Save 12K in 2017 # 9 £11,119.65/15 000 (74%)
    Save 12K in 2016 # 8 £19 721.58/12 000 (164.35%) Achieved!
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