S&P 500 fund / etf for iWeb transfer

System

k6chris wrote: »

Which one would you use if you wanted to factor out any dollar risk, is that simply the GBP fund??

Why would you want to do that? 'Dollar risk' is one of the benefits of international diversification!

Jwheeler123

I hold ishares S&P 500 UCITS ETF USD (Dist). iWEB have said they cannot accept that type. I could sell my holdings with HL and transfer the value as cash to iWeb but was worried about reduced gains from being out of the market, especially if the transfer process is slow.

masonic

Jwheeler123 wrote: »

I hold ishares S&P 500 UCITS ETF USD (Dist). iWEB have said they cannot accept that type. I could sell my holdings with HL and transfer the value as cash to iWeb but was worried about reduced gains from being out of the market, especially if the transfer process is slow.

IIRC, that ETF has relatively high charges by today's standards (edit: looks like they've been reduced to 0.07% since I last looked).

The transfer process could take months, so it would be better to fund switch at HL to something iWeb will accept. Plenty of options above.

MK62

Economic wrote: »

Why would you want to do that? 'Dollar risk' is one of the benefits of international diversification!

It is when the US Dollar rises vs Sterling......a bit of a drawback when it falls against Sterling though.

System

MK62 wrote: »

It is when the US Dollar rises vs Sterling......a bit of a drawback when it falls against Sterling though.

You don't understand diversification! A UK resident will have a job and a house that are dependent upon the state of the UK economy. By investing globally, a UK resident will have assets that rise in value when the UK economy does poorly (and sterling falls) and fall in value when the UK economy does well (and sterling rises). This is exactly what you want from diversification.

stphnstevey

IanManc wrote: »

IWeb have the HSBC American Index Class C fund which is an OEIC with an OCF of .07%, and Fidelity Index US Class P fund which is an OEIC also with an OCF of .07%. Both of them track the S&P 500 and have holdings of 507 and 505 companies respectively.

You might also want to consider two other US funds which IWeb have: the Legal and General US Index Class I fund which is a unit trust with an OCF of .1% that tracks the FTSE USA index and has holdings in 614 companies; and the Vanguard US Equity Index fund with an OCF of .1% which is an OEIC that tracks the S&P Total Market Index and has holdings in 3472 companies.

All of them are UK based. The last one is my personal favourite as it includes the mid and small cap element.

Hope this is of use.

As IWeb charge the same transaction charge (£5) and no "holding" charge for funds or shares, you might want to consider funds to ETFs.

CSP1 is around £200 per share, so I often find I have anywhere up to £200 "change" from a transaction of say £1000. It wouldnt make much of a difference, but if you would rather invest every penny, then a fund will often allow you to invest all of your investment

CSP1 is Accumulation share so you might want this in your ISA as you dont have to account for any tax on dividends like you have to outside the tax wrapper. VUSA is Distribution, so you might incur further costs to reinvest the dividends

There is normally a choice of either Accumulation or Income with funds

There is a new Lyxor ETF:Lyxor Core Morningstar US (DR) UCITS - Acc tracking the Morningstar US Large-Mid Cap NR Index which you might consider similar to the S&P 500. It has the lowest OCR of 0.04% last time I checked, but I dont know if available on IWeb (although Im told if you ask, they often make other ETFs available) and is pretty small and not sure the number of holdings etc

masonic

stphnstevey wrote: »

...and is pretty small...

Very small. I'd be a little concerned about liquidity and spread, although if it's one you hold you'd know about that.

MK62

Economic wrote: »

You don't understand diversification!

So perhaps you could explain it then?

Economic wrote: »

A UK resident will have a job and a house that are dependent upon the state of the UK economy. By investing globally, a UK resident will have assets that rise in value when the UK economy does poorly (and sterling falls) and fall in value when the UK economy does well (and sterling rises). This is exactly what you want from diversification.

Well a UK resident may or may not own a house (or a flat etc), and he/she may or may not have a job...I don't, and neither do several million other retirees.

What do you mean by investing globally, and how much of a portfolio are you suggesting should be invested overseas (in non-Sterling currencies)?

masonic

When considering currency risk, one should think about the origin of the goods and services one consumes and which currencies are the main determinant of their cost. Things like energy, transportation, food, electrical items, subscriptions etc etc. It is probable that some exposure to the dollar and other currencies through international investments is justifiable.