Cheapest Way Into Global Tracker Funds

mrke

Hello,

I'm looking for the cheapest way to invest in a global tracker fund. Initially looking to invest £50 to £100 per month.

Would anyone know the cheapest combined cost for a single global fund and platform charge please?

Vanguard only charge 0.15%, yet their global funds appear to be a bit more expensive.
A few others like Charles Stanley charge 0.25% yet their funds appear a little cheaper.

It's not easy as far as I can see to find the very lowest cost way for the joint fund and platform combined.

Many thanks,
Mark

JohnRo

Have you decided which one of the many 'global tracker funds' out there you want to hold?

That's the first step.

bowlhead99

JohnRo wrote: »

Have you decided which one of the many 'global tracker funds' out there you want to hold?

That's the first step.

Agreed, but assuming Vanguard have something you find acceptable...

At 'only' £50-100 per month it is easiest to go with a provider that charges an annual percentage rate for their platform services rather than an additional fee each time you want to invest more money. So Vanguardinvestor and Charles Stanley Direct would be good examples with platform fees of 0.15% and 0.25% a year respectively.

Then look at what they offer. Vanguardinvestor only offers vanguard's own products while CSD will offer a whole funds-supermarket worth, from investment managers including (but not only) vanguard.

Vanguard offer a fund that tracks the FTSE Global All Cap index of some 7000+ stocks, and they also have more complicated funds such as the Lifestrategy range which tracks a number of indexes all in one product and has a bigger weighting to the UK stock market index if that's something you'd like. For either of those funds, the ongoing charges figure is a little under a quarter of a percent, so the "all in" (fund ongoing charges figure plus provider platform free) cost is about 0.4% or thereabouts.

If you went to CSD, but wanted to get an all in cost of about 0.4% and had already used up 0.25% of that on platform fees, you'd only have space for 0.15% of actual fund running costs. Let's say by some miracle you find a global equity index fund from some fund manager available on CSD for 0.05% so your total cost is only 0.30% compared to almost 0.4% at vanguard investor. Great saving? Well on £1000 invested for a full year, it's about a pound.

At that level the fees are not going to kill you so between those two providers as an example, it's just a simple choice of will restricting yourself only to vanguard products give you a bad result, or would you prefer a broader offering at CSD so that your higher platform fees gives you the chance to save those fees back by accessing cheaper or better funds

In your position I would probably go vanguardinvestor, though I'm not in your position, and don't

BLB53

In addition to costs, it will also be important to select an asset mix which is matched to your personality and appetite for risk/volatility.

The Vanguard Lifestrategy offer a choice of equities/bonds in one multi asset mix. Yes you pay a little more at 0.22% but they may provide a good return if you find a level you can stick with through all the ups and downs of the global markets.

I hold VLS 40 & 60 via Vanguard Investor.

A_T

BLB53 wrote: »

In addition to costs, it will also be important to select an asset mix which is matched to your personality and appetite for risk/volatility.

The Vanguard Lifestrategy offer a choice of equities/bonds in one multi asset mix. Yes you pay a little more at 0.22% but they may provide a good return if you find a level you can stick with through all the ups and downs of the global markets.

I hold VLS 40 & 60 via Vanguard Investor.

OP wants a global tracker not a multi-asset fund.

mrke

Thank you all for the replies thus far.

I am not worried about the limited range offered by Vanguard, just looking for the cheapest Global tracker.

Having now looked at the Vanguard FTSE Global All Cap Index Fund (GB00BD3RZ582) as kindly mentioned above, this would give an all in charge of 0.39% which is very good.

Also most Vanguard funds carry a 'transaction cost' over and above the fund and platform fee which this one does not, which all in all makes this a tempting proposal...

Anyone kindly offer me a cheaper option? If not I think the decision is made.

rathernot

Respectfully if you're only putting in a grand a year just go with Vanguard, otherwise you're doing a ton of homework over what boils down to a fiver a year.

Don't get me wrong, fees add up over time due to compounding but at that sort of level it's neither here nor there IMO.

Lungboy

I'm not sure 0.39% can be beaten. HSBC FTSE Global All Cap is 0.16% but on the cheapest platform (0.25%) it comes in at 0.41%. There is a much cheaper version at just 0.03% but I've been unable to find it on any DIY platform.

ColdIron

If cost alone is your metric

A judicious mix of the following will get you below 0.38% at Charles Stanley Direct
L&G International Index (FTSE World ex UK) 0.13%
L&G UK Index 0.10%

Or for a single fund at 0.37%
Fidelity Index World (MSCI WORLD INDEX) 0.12%

But on £1,000 if you cut out a couple of cups of coffee a year you'd have a wider choice

mrke

Yes cost is very much the key....

Looks like the winner is: 0.37% Charles Stanley Direct & Fidelity World Index P

I have other funds that can be added to the investment in time, the £1000/y approx. is as mentioned where I want to initially start.

I very much appreciate you all taking the time to reply.

rathernot

I think that's sensible, I get the liking of Vanguard but it does limit your investment options.