Vanguard Life Strategy

ColdIron

Is this a good thing? The levy 'was designed to offset transaction costs and benefit long-term investors.' While I can see the advantage, or removal of impediment, for new investors it cannot be neutral for existing investors. You can't have it both ways

The sums are low, £100 on £100K and existing investors can benefit if 'lifestyling' to lower equity proportions or transferring into an ISA, so I guess we should welcome all reduction in charges

bowlhead99

The PDLs are paid straight into the fund in question and are designed to prevent existing investors from bearing the transaction costs of investors who trade in or out of the fund. As the funds grow, these costs become less significant and we are passing the benefit of this growth on to our investors.

Makes sense for them to do that now the funds are at a decent size (over £2bn across the different versions) and they perhaps don't forecast a lot (relatively) of net new subscriptions over the next couple of years. If there are no net inflows they are not paying stamp duty costs etc and do not need to spend money to deploy new capital.

When I first bought in three years ago I paid 0.22% dilution levy; it was always expected that the size of the levy would vary over time, with the most recent 0.10% level being set quite a while later, after more growth (and after they dropped the weight of the UK component).

Still, can't complain about having had to pay that 0.22% on top of the £103 per unit; at £145 yesterday, the units are now £42 more valuable than they were in August 2012 - about 12% annualised.

roxy28

I have just paid in £1000.00 into my ISA on charles stanley, ready to buy more of the fund.
But this time it shows i have only £999.04 to invest, have the changes affected this?.

noggin1980

did you owe them a pound from last months charges? which would be the monthly charge on a bit under 5k i think

if you click dashboard>statement you will see. mine says
3 Aug 2015 Funds Platform Fee 0.00 2.56

roxy28

noggin1980 wrote: »

did you owe them a pound from last months charges? which would be the monthly charge on a bit under 5k i think

if you click dashboard>statement you will see. mine says
3 Aug 2015 Funds Platform Fee 0.00 2.56

Ok thanks i will check, but i never knew i owed anything but it may be as you say.

roxy28

Yes there is a Funds Platform fee 3 aug 2015 0.96 , so thats been deducted. Looking around my dashboard to get used to it. Can you explain the section " Fund Basket ", where it says on mine weight 5%, and that means "The percentage of the investment applied to your basket of funds ". There is a option it seems to Split Evenly?

JohnRo

I think it's designed to streamline the purchasing of several funds with a fixed amount of cash in preset ratios and then allocate the payments accordingly.

The fund basket always struck me as a bit of a gimmick but I suppose it serves to speed up the one off purchasing process so if you were buying into several funds with a fixed lump sum it's quicker than individually entering trades for each fund, I can't see it's use beyond that unless I'm completely misunderstanding the purpose of it.

Haven't used it to buy anything myself.

noggin1980

roxy28 wrote: »

Ok thanks i will check, but i never knew i owed anything but it may be as you say.

They will take 1/12th of 0.25% of the total value of your investment each month and will allow you to go negative, presumably at some level of overdrawnness or period of time they would either chase you for it or take it from one of your investments but I'm not really sure how it works.

I'm new to investing myself and havn't used the fund basket section.

roxy28

noggin1980 wrote: »

They will take 1/12th of 0.25% of the total value of your investment each month and will allow you to go negative, presumably at some level of overdrawnness or period of time they would either chase you for it or take it from one of your investments but I'm not really sure how it works.

I'm new to investing myself and havn't used the fund basket section.

Ok. I have not used the fund basket section myself, just looking around dashboard to get to know things.

roxy28

JohnRo wrote: »

I think it's designed to streamline the purchasing of several funds with a fixed amount of cash in preset ratios and then allocate the payments accordingly.

The fund basket always struck me as a bit of a gimmick but I suppose it serves to speed up the one off purchasing process so if you were buying into several funds with a fixed lump sum it's quicker than individually entering trades for each fund, I can't see it's use beyond that unless I'm completely misunderstanding the purpose of it.

Haven't used it to buy anything myself.

Thanks for the input, its my first time with funds etc.