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ETF questions
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![[Deleted User]](https://us-noi.v-cdn.net/6031891/uploads/defaultavatar/nFA7H6UNOO0N5.jpg)
[Deleted User]
Posts: 0 Newbie

A few questions relating to trading ETFs on LSE (via AJ Bell):
1. The “fund currency” is stated as either EUR or USD, however “trading currency” can be GBP. Will the broker be charging any currency exchange fees?
2. Looking at new Vanguard ETFs, established less than a year ago, such as “Vanguard FTSE Developed Europe UCITS ETF (EUR) Accumulating”. Does it mean there will be large spreads? The “Distributing” version is much older and larger but I would rather avoid having to mess with the dividends,
3. One of the ETFs I am looking at uses “Physical (Optimized sampling)” method of replication. (Vanguard FTSE Emerging Markets). Where do I find out what they actually hold?
4. Confused about terminology used to describe charges. If I look at JustETF, it shows Vanguard FTSE Developed Asia Pacific ETF TER of 0.15%. If I look at Vanguard’s own Factsheet, it quotes “ongoing charges” of 0.25%. Thought British TER was supposed to include all charges. How can “ongoing charges” be higher?
Thanks!
1. The “fund currency” is stated as either EUR or USD, however “trading currency” can be GBP. Will the broker be charging any currency exchange fees?
2. Looking at new Vanguard ETFs, established less than a year ago, such as “Vanguard FTSE Developed Europe UCITS ETF (EUR) Accumulating”. Does it mean there will be large spreads? The “Distributing” version is much older and larger but I would rather avoid having to mess with the dividends,
3. One of the ETFs I am looking at uses “Physical (Optimized sampling)” method of replication. (Vanguard FTSE Emerging Markets). Where do I find out what they actually hold?
4. Confused about terminology used to describe charges. If I look at JustETF, it shows Vanguard FTSE Developed Asia Pacific ETF TER of 0.15%. If I look at Vanguard’s own Factsheet, it quotes “ongoing charges” of 0.25%. Thought British TER was supposed to include all charges. How can “ongoing charges” be higher?
Thanks!
0
Comments
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There's loads of info on AJB's website: https://www.youinvest.co.uk/our-services/investment-options/exchange-traded-funds
Maybe best to ask them if you have any remaining queries, to be sure of an accurate answer.0 -
Deleted_User wrote: »A few questions relating to trading ETFs on LSE (via AJ Bell):
1. The “fund currency” is stated as either EUR or USD, however “trading currency” can be GBP. Will the broker be charging any currency exchange fees?2. Looking at new Vanguard ETFs, established less than a year ago, such as “Vanguard FTSE Developed Europe UCITS ETF (EUR) Accumulating”. Does it mean there will be large spreads? The “Distributing” version is much older and larger but I would rather avoid having to mess with the dividends,
It can be convenient to avoid messing around receiving and reinvesting dividends, but either way generally speaking you'll need to find out what dividend income was received and not distributed so that you can figure your income tax. Though as you are on the pensions board perhaps your proposed investment is in a pension wrapper so you don't need to worry about it.3. One of the ETFs I am looking at uses “Physical (Optimized sampling)” method of replication. (Vanguard FTSE Emerging Markets). Where do I find out what they actually hold?4. Confused about terminology used to describe charges. If I look at JustETF, it shows Vanguard FTSE Developed Asia Pacific ETF TER of 0.15%. If I look at Vanguard’s own Factsheet, it quotes “ongoing charges” of 0.25%. Thought British TER was supposed to include all charges. How can “ongoing charges” be higher?
JustETF.com is not a particular authority, so usually Vanguard's own factsheet is what you should rely on. If you look at the Vanguard factsheet for that fund, linked from the Justetf site, it shows 0.22% OCF (perhaps your 0.25% was a typo or misreading).
However, as mentioned above, Justetf is not a particular authority and the last Vanguard factsheet they're showing is September's. What you should do is go to Vanguard's own website where you can see the OCF is now 0.15%.
That's as a result of a recent cut in fees for a broad range of Vanguard's UK-marketed OEICs and ETFs, in which it was announced within the last month the OCF dropped from 0.22% to 0.15% on that one. Back at the time of the September factsheet 0.22% was the latest estimated OCF but it has fallen since then.0 -
Awesome, thank you!
Yes, should have written 0.22% OCF, but actually 0.15%, as you described. And the funds will be held within a SIPP.JustETF.com is not a particular authority, so usually Vanguard's own factsheet is what you should rely on. If you look at the Vanguard factsheet for that fund, linked from the Justetf site, it shows 0.22% OCF (perhaps your 0.25% was a typo or misreading).
I am used to MER (management expense ratio). MER = management fee + operating expenses + taxes (on management fees and administration charges). OCF appears to be the exact same thing. Is that right?
The other part I am still a little confused about is the “accumulation” version (that’s something we don’t have in N America). In general I would avoid brand new ETFs, but the Vanguard “accumulation” versions appear to be the exact same ETF as the older, larger and, presumably, more liquid distribution version. Is that really a different fund or just an automated dripping set up for the old fund? In the latter case there should be no issues.0
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