No difference between funds

Herbalus

I am invested in 2 particular funds, which as far as I can tell are doing almost exactly the same thing. I find this fascinating, as although they are similar types of investments, L&G is specifically exUK whereas Blackrock Consensus 100 is 13% equities.





Thoughts?

Alexland

Global stock markets are increasingly synchronised these days and the differences over such a short period might be just as much related to when in the day the valuations occur as the asset allocation.

dunstonh

What were you expecting when comparing two funds with an asset makeup of global equities?

bostonerimus

I think this points out that there might be many thousands of funds being sold, but often the only difference is the label. The financial industry is just like any other trying to sell you a product and make money off what you pay for it.

eskbanker

Herbalus wrote: »

L&G is specifically exUK whereas Blackrock Consensus 100 is 13% equities.

I think you'll find that Blackrock Consensus 100 is 100% equities!

....of which 15.68% are UK, according to https://www.blackrock.com/uk/individual/products/230296/blackrock-consensus-100-fund-i-acc-fund

AnotherJoe

The 15% U.K. equities will be the top companies in the FTSE 100 which are all massive global companies and so they will move in concert with global trends. Over time I would expect a slow divergence because of the slight over concentration in at handful of industries. I suggest if you can't decide, split 50/50 between the two which will get you down to the rough U.K. world gdp % for your investments as a whole.
Or find some funds that do that naturally and pick the one of those with the lowest % management rate. Unless these two have similar low rates in which case 50/50.
A few years back I realised I was getting analysis paralysis stopping me investing and split equally between two funds. They've tracked each other within 1/4 % ever since. No harm done.

Herbalus

eskbanker wrote: »

I think you'll find that Blackrock Consensus 100 is 100% equities!

....of which 15.68% are UK, according to https://www.blackrock.com/uk/individual/products/230296/blackrock-consensus-100-fund-i-acc-fund

Ah yes, I meant 13% UK according the HL page. Too many glasses of wine last night.

Herbalus

dunstonh wrote: »

What were you expecting when comparing two funds with an asset makeup of global equities?

I wasn’t expecting 2 different funds, with one completely ex UK and one not, to return virtually identical performance.

I know they are similar, but expected more difference given the inclusion of UK in blackrock.

Or maybe it just means that the uk is insignificant :T

dunstonh

I wasn’t expecting 2 different funds, with one completely ex UK and one not, to return virtually identical performance.

They are very similar funds and passive (one being passive and the other being a fund of funds that usses passives). They invest largely in the same areas with similar weightings. The UK chunk will be dominated by large companies with mostly overseas earnings that are generally priced on the global stage. So, you get similar performance. This is why many people allocating their UK equities segment will look towards equity income, recovery/spec sits or small or mid cap rather than a general UK fund.

A_T

Over 5 years there is quite a difference - 10.7% pa annualised for the Blackrock whereas the L&G is 12.7% pa