Clean vs non-clean tracker funds

WobblyDog

I've been drip-feeding into an HSBC FTSE All-Share fund in an ISA for several years, bought via HSBC, who I have my current account with.

Most of my contributions are in the non-clean "HSBC FTSE All-Share Index Fund (A)", but having recently changed my monthly contributions, all future money will go into the clean "HSBC FTSE All-Share Index Fund C (A)".

HSBC asked whether I want to transfer the money in the non-clean fund into the clean fund. I said "not at the moment", because I'm not sure whether it's a good idea. I don't really want to ask HSBC for advice, in case they want to charge for it. Is it likely to be a good idea?

Finally, if I understand correctly the total charges I'm paying are about 0.49% of fund value annually. Am I likely to get a much better deal elsewhere? I quite like the convenience of doing everything through HSBC.

masonic

You would need to get information about the charges levied by both classes of fund and details of the rebate you are getting from the dirty class (if any), plus any costs involved in converting your existing holding, to make the comparison. I'm sure they wouldn't charge you for helping you to compare the costs. Converting usually makes sense, unless the net cost of the clean class is more expensive (which is rare).

0.49% is not too bad if it includes your current fund charge and any platform charge. If the net fund charge is 0.17%, then the platform fee comes to 0.32%. There are cheaper options, but if you are happy where you are then you may be content to pay a little extra.