Multiple listings of the same basic ETF

EnglishMohican

I have just been trying to buy some Vanguard Asia Pacific Ex Japan ETF shares. The relevance of that is that my broker (X-O) lists VDPX.L, VAPX.Am amongst others but not including VAPX.L.

VDPX is the dollar version of this ETF and VAPX is the GBP version. ".L" means it is available from the London Stock exchange and ".AM" means its listed on the Amsterdam exchange. (There are other exchanges it is listed on but Amsterdam will do for an example.)

Assuming I am correct so far which may not be the case, then my puzzle is:-

1. Can I really buy shares from the Amsterdam Exchange through X-O - a no frills broker?
2. Would I pay them GBP or euros if so?
3. Is there any benefit to me in using the Amsterdam Exchange and presumably paying in pounds but with X-O converting the pounds to euros (or other variations on that theme).
4. As they list VDPX at London but not VAPX, why should this be. Is there some advantage to using US$ to buy on the London Exchange. Otherwise why would they list VDPX but not VAPX.

To be clear, VAPX is available on the London Exchange, others do list it. So it could just be X-O needing to add it to their database. On the other hand, if they have not added VAPX, why should they list VDPX - at London.

I could ask X-O but they would give me factual, narrow answers but I am wanting a bit of explanation and somebody to read between the lines a bit and explain whether in some circumstances the less obvious option is useful.

Edit :- I have noticed that the other two exchanges mentioned for VAPX are .X and .P. I wonder if this stands for GB pence and GB pounds - from the London Stock Exchange. But this is just guessing.

grey_gym_sock

i don't think there's any advantage in buying ETFs on other stock exchanges or in other currencies (when they're available on LSE in £). and for other currencies, there is the disadvantage that you will probably be charged a currency conversion fee, if you are using £ to buy shares quoted in another currency.

i'm not sure whether, when x-o say VDPX, they are really going to convert your £ to $ - or ask the market maker to convert it - before buying in $, or whether they're really just going to buy VAPX in £ (in which case, it's just a bit misleading that they have it set up as VDPX). or if they ask a market maker to sell them some VDPX for £, will the market maker give them the same price as for buying VAPX in £ (given this is a case where both VAPX and VDPX, differing only in currency, are quoted on LSE)? you could try and ask them something like that.

x-o's site says they only give you access to the london stock exchange.

EnglishMohican

I ended up asking X-O so now have a bit more information. The person who replied did not know what the .X, .P, .Z endings meant but they agreed that .L meant London Stock Exchange and stated this was the only one I could buy on their system.

They said that I could buy VDPX (the dollar version) and they would do the conversion from GBP to dollars at an in-house rate.

They also said that I could force their system to buy VAPX.L by adding the .L even though their system did not offer that option - seems a poor arrangement if true (and it seems to be).

A previous thread seems to me to say that the base currency of the fund does not matter, only the currency of the stocks the fund invests in - which seems reasonable but then why do Vanguard offer a dollar version in the UK and why is it offered by X-O if nobody has a reason to buy it?

grey_gym_sock

EnglishMohican wrote: »

I ended up asking X-O so now have a bit more information. The person who replied did not know what the .X, .P, .Z endings meant but they agreed that .L meant London Stock Exchange and stated this was the only one I could buy on their system.

They said that I could buy VDPX (the dollar version) and they would do the conversion from GBP to dollars at an in-house rate.

so the in-house rate might effectively include a currency conversion charge. or might not. not quite clear.

you could ask whether they use the same in-house rate when converting the other way, $ to £, when you sell VDPX.

They also said that I could force their system to buy VAPX.L by adding the .L even though their system did not offer that option - seems a poor arrangement if true (and it seems to be).

or you could use this more cumbersome way to buy VAPX.L - since that can't involve any currency charge.

A previous thread seems to me to say that the base currency of the fund does not matter, only the currency of the stocks the fund invests in - which seems reasonable but then why do Vanguard offer a dollar version in the UK and why is it offered by X-O if nobody has a reason to buy it?

yes, apart from any charges at the point of buying and selling, you'll get exactly the same return for VAPX and VDPX. the dividends are actually paid in dollars for this ETF, regardless of the line you hold (and x-o presumably automatically convert them to £, again perhaps after applying an implicit currency conversion charge). and the capital value of 1 share will be the same for both lines - they both hold the same underlying assets.

buying VDPX could make sense if your broker supports multi-currency accounts (which x-o don't, i think), and you're already holding some $ with them.