Regular investments into Vanguard Life Strategy 60%

MadMat

Ryan_Futuristics wrote: »

Worth remembering Lifestrategy isn't really a tracker (as much as it fits Vanguard's image to pretend it is) ... the asset allocation's actively managed like any other hedge fund

Well it's not a simple tracker, it's a basket of 10 trackers, and being rebalanced to set a % for each of the 10 trackers is more formulaic than active management!

FWIW to the OP, I was in a similar situation, and after a lot of reading both here and other sites, particularly monevator I ended up going with £100/month into VLS 80 in an ISA with Charles Stanley Direct and am very happy with the arrangement just over a year later!

Mat

bowlhead99

MadMat wrote: »

Well it's not a simple tracker, it's a basket of 10 trackers, and being rebalanced to set a % for each of the 10 trackers is more formulaic than active management!

You are right it is more formulaic but they don't publish the target allocations or rebalance frequencies; the mix between trackers and between underlying country allocations bobbles around a bit if you put the monthly factsheets next to each other; the LS100 tracker and country allocations has changed by a percent or so here and there from April to October.

Also every so often they may make a major change in response to perceived demand - last year 35% UK in LS100, this year 25%; product was not even 3 years old at that time.

I do prefer to have a set of rebalanced country trackers a la Lifestrategy than just one world tracker where the percentages of each country can theoretically change by more. However, it doesn't mean they will not change at all, nor that the way they've allocated now or in the future is right for an individual investor.

edinburgher

But for a UK investor I'd call a default equities portfolio 50:50 UK index and Global index - and go with Legal & General and you're paying 0.05% (less than a quarter of Lifestrategy's charges)

I don't agree with your overall stance on VLS/index investing, but absolutely agree with you on the importance of cost. It would be interesting to see tracking error figures for the two L&G products you've quoted (an activity for my lunch break) :beer:

Krapello

I invest in a VLS fund via TD Direct. If you set up a monthly regular investment you pay zero dealing fees and zero ISA management fees. They trade twice per month, min. monthly investment is £50. Info at tddirectinvesting dot co dot uk

Monevator's section on Passive Investing is what got me started. You might find it helpful, see monevator dot com

As a newbie I can't post links despite having posted before... whatever

trickydicky14

Hi all, reading this thread has made me think, I currently have VL 60% within an ISA account only a few months old with Charles Stanley and I am 60years old.
Question, if I wanted to set up and run a VL 40% alongside as has been talked about in this thread to give me a straight 50:50 balance what would be my extra running costs having the two and if needed what would it cost to move funds from one fund to the other. I have no plans to move funds as yet because I currently pay a monthly amount in to my Charles Stanley account that could be diverted if needed. Can I also state I have no current concerns regarding my choice of funds but just thinking about the future possibilities. As every one keeps saying, “Keep those fees down”.

dunstonh

If you are going to mention L&G then its worth considering the L&G multi-index funds. Very similar to VLS but with wider asset allocation and a bit more active management in asset allocation whilst still using passives. Our risk modelling shows the L&G ones fill the gaps a bit between the 20% jumps in VLS.

Ryan_Futuristics

trickydicky14 wrote: »

Hi all, reading this thread has made me think, I currently have VL 60% within an ISA account only a few months old with Charles Stanley and I am 60years old.
Question, if I wanted to set up and run a VL 40% alongside as has been talked about in this thread to give me a straight 50:50 balance what would be my extra running costs having the two and if needed what would it cost to move funds from one fund to the other. I have no plans to move funds as yet because I currently pay a monthly amount in to my Charles Stanley account that could be diverted if needed. Can I also state I have no current concerns regarding my choice of funds but just thinking about the future possibilities. As every one keeps saying, “Keep those fees down”.

Actually I think the best way to go 50:50 would be to own equal parts: Lifestrategy100 fund and a Vanguard Global Bond Index (the bond section of an LS fund), and rebalance them annually

For a start, the LS charge is 0.24%, while the Bond Index is only 0.15% ... So it would take your combined fees down to 0.195%

It would also give you the ability to manually increase your bond allocation as your investment horizon eventually changes


However ...

You do have to be aware of how interest rate rises (as we're likely entering into next year) affect bonds funds ... So, for me, a better choice might be to go with Vanguard's new UK Short-Term Investment Grade bond index instead

It's the same low charge as the Global Bond Index, yields higher, and should be better protected from interest rate rises

MadMat

trickydicky14 wrote: »

Hi all, reading this thread has made me think, I currently have VL 60% within an ISA account only a few months old with Charles Stanley and I am 60years old.
Question, if I wanted to set up and run a VL 40% alongside as has been talked about in this thread to give me a straight 50:50 balance what would be my extra running costs having the two and if needed what would it cost to move funds from one fund to the other. I have no plans to move funds as yet because I currently pay a monthly amount in to my Charles Stanley account that could be diverted if needed. Can I also state I have no current concerns regarding my choice of funds but just thinking about the future possibilities. As every one keeps saying, “Keep those fees down”.

as I understand it, there would be no extra fees. dealing in funds is free, so you'd simply pay the 0.25% platform fee on the total portfolio.

you would need to be investing at least £100 a month though as the minimum monthly investment is £50 per fund.

Mat

ColdIron

trickydicky14 wrote: »

what would it cost to move funds from one fund to the other.

Vanguard levy a 0.1% initial charge when you buy, it's probably not big money but you should be aware of it. Too much churning would see it mount up