The cheapest way to buy a FTSE all-share tracker...?

fordmg

Hi there

I've tried to research this but it's so hard to actually get a definite answer. So far, I have researched tracking error and found the best fund for me. That's all fine. I want to buy the Vanguard FTSE All-Share Tracker Accumulation fund. I will invest £300 per month. I plan to hold for 10 years or more.

Now here's where it gets confusing. What is the cheapest fund platform for this kind of investing? At the moment I have multiple tabs open with articles claiming 'Cheapest investment platforms', then it goes on to list a wealth of ambiguous fees and platforms and options....blah blah blah

As far as I know, I'll be paying the ongoing charge fee (OCF) of around 0.08%
Then on top of that the dealing platform fee. So what is actually the cheapest platform? I don't need any financial advice just the cheapest platform for my above approach - ie £300 pound per month buying a FTSE All-share tracker Acc index from Vanguard.

Also when they say dealing fees, does this mean they will charge you a % each month for dealing - ie buy £300 worth of the all-share index?

Many thanks!

Eco_Miser

Since you won't have much in in the early years, a percentage based platform fee and zero transaction fee would seem the way to go.
Charles Stanley Direct and Cavendish Online are two such, but there may be better for your circumstances.
I was just reading from http://monevator.com/compare-uk-cheapest-online-brokers/

Most platforms charge for holding your funds/shares electronically( either flat fee or percentage), and for buying/selling them (normally flat fee). Some only charge for one or the other.

P.S. Use an ISA account to protect you from Capital Gains Tax, Dividend Tax, and keeping detailed records.

bigadaj

The ocf for that fund is shaping at 0.08% on hl, think you might have your decimal point in the wrong place. On top of that you will have the platform fee, which is as low as 0.25% with csd or cavendish etc as Eco miser says. monevator is a good reference point as is the Lang cat. No dealing charges with these on oeics, you just pay the percentage fee monthly on the balance in the account (0.02% ish for the above).

Just wondered why you were putting all into the ftse all share, of this is your only investment then a world tracker might be better for diversification and to likely give better and less volatile returns.

Playing_with_Fire_2

Check out Selftrade - free to buy and hold funds as long as you trade once/3 months, fees for selling.

Echo considering a global tracker alongside the FTSE for diversification.

fordmg

Thanks for the replies

Yes sorry, I had my decimal in the wrong place

And I was actually thinking about splitting that £300 across three trackers, but just wanted it to keep it simple to find out which platform was the cheapest

FTSE All-Share
Emerging market fund
Techfund/World fund

So I guess by charges would be 0.08 (Vanguard OFC) + Cavendish platform (0.25) = 0.26 per year

Plus the Vanguard one off entry fee (0.2). Am I right in saying that this would go towards stamp duty and that in other funds that don't have the initial charge (eg HSBC FTSE All-share tracker) would take a similar sized hit later on when I sold them?

And am I right in saying that this is not charged each time I invest each month?

Thanks again!

jimjames

fordmg wrote: »

So I guess by charges would be 0.08 (Vanguard OFC) + Cavendish platform (0.25) = 0.26 per year

My calculator suggests 0.25 + 0.08 = 0.33 but yes you've got the idea.

You could even use a multi asset fund to avoid needing 3. With the ones suggested you have no exposure to Far East, Europe, bonds and little to USA.

fordmg

Opps, sorry I was distracted when typing that

I swear my math skills aren't that bad

Thanks for the advice

Eco_Miser

fordmg wrote: »

Plus the Vanguard one off entry fee (0.2). Am I right in saying that this would go towards stamp duty and that in other funds that don't have the initial charge (eg HSBC FTSE All-share tracker) would take a similar sized hit later on when I sold them?

Yes, and sort of - you, and every other shareholder, would take a hit every time anyone else buys the fund and the manager has to buy the underlying shares and pay stamp duty, which is charged to the fund. Vanguard's way, it's the new buyer who takes the hit, which is to the advantage of long-term buy and hold fundholders.

fordmg wrote: »

And am I right in saying that this is not charged each time I invest each month?

No, it's an initial charge on each investment.