Buy/Sell units in Vanguard

[Deleted User]

When you issue a buy or sell units on Vanguard's platform, do you specify the amount of money or the number of units? For instance, if you have 500 units, are you able to say you want to sell 200 units, or do you have to specify the amount in ££'s you want to sell.

learningmoneybasics

I sold part of a holding yesterday on the Vanguard platform and both options are available.

george4064

I think you will get different options for buying and selling, as follows.

For buys: You will only be able to place an order for a monetary (£) amount, this is because the funds operate on a 'forward pricing basis'. This means that you won't actually know the price per unit when you submit your trade. So 500 units today might be worth/cost £500 if bought today however those 500 units might be worth/cost £505 tomorrow. So platforms don't give the option to buy units because your account may be overdrawn (if the price increases between when you place your order and when it completes such that your account is overdrawn).

For sales: You will be given either option. For example if you wanted to sell your entire holding you will have to place a unit instruction (however realistically the website would probably have an option to 'sell all units). However similar issue to purchasing units and potentially going overdrawn, lets say you own a fund thats worth £1,000 and you instructed to sell £999 worth of units. You may end up selling more units than you actually own, because if unit price falls so that to redeem £999 you would have to sell more units than what you actually hold. Again Vanguard should have a protection against this such as you can only sell 90% of your fund value if you wish to do a monetary sale, otherwise you must sell all units.

For instance, if you have 500 units, are you able to say you want to sell 200 units, or do you have to specify the amount in ££'s you want to sell.

As above, you will be able to instruct to sell a specific number of units. However you will only be able to sell a maximum (say about) 90% of the value of the fund if selling in ££s.