Vanguard Price Confusion

Amarone

CS take my direct debit to this fund to buy in on the 10th of every month so unsure when my price is actually worked out? They only seem to purchase this fund on the 10th?

bowlhead99

They will have a day when they pool together the orders of everyone and then go buy the funds in bulk. Some platforms have more than one day a month to give investors a choice. You will get some sort of contract note (like a receipt) showing what you bought and the order date and/or value date - the date will usually be after they've had chance to verify that your direct debit cleared rather than bounced.

From your contract note you can see what price and date you got, not that it matters much on a monthly plan.

mgarl10024

Thanks for all the replies - very helpful.

So, on Friday (at around midday), I placed the order. As I was after the 9.15am cutoff, this would be as if I had placed the order on Monday morning.
I then get the price that it was on Tuesday.

https://www.vanguard.co.uk/uk/portal/detail/mf/overview?portId=9232&assetCode=BALANCED##portfoliodata says that the price on Tuesday was £154.4016

I've just received my contract note, and it says I paid 155.425196015 which matches none of the prices on the above link. :huh:

So, I'm still confused.

Further info from my Contract Note:
Bargain Date and Tax Point: 13th April 2015
Settlement Date: 16th April 2015
Bought: VANGUARD INVESTMENTS UK LTD
LIFESTRATEGY 100 PERCENTAGE EQTY ACC NAV
Time: 21:00
Price: 155.425196015 XD (Not sure what the XD means).

What am I missing?

Thanks again,

bowlhead99

If your order is already in at opening of business on Monday I presume you will get the Monday price (albeit that price won't be worked out until they have done the valuation prices using Monday closing prices, so can't be published until Tuesday). So first make sure you are actually comparing the right day's price.

Then, as you may or may not be aware, there is a pre-set dilution levy that new joiners pay into the fund to cover the costs of admitting them and deploying the cash into underlying assets . So if that charge is not explicit on your contract note, perhaps your broker built that into the price to make it easier for you to see your total cost.

mgarl10024

bowlhead99 wrote: »

there is a pre-set dilution levy that new joiners pay into the fund to cover the costs of admitting them and deploying the cash into underlying assets . So if that charge is not explicit on your contract note, perhaps your broker built that into the price to make it easier for you to see your total cost.

That's it!

Monday's price = £155.2738
Dilution Levy = 0.1%
So £155.2738 / (1-0.1%) = 155.429229 - which is very close to the 155.425196015 I paid.

Assuming that my Friday lunchtime transaction was counted as being on Monday, I got Monday's price.

Thanks Bowlhead