which vanguard fund

jamels2

I was planning to use vanguards own platform as I've read it's the best deal up to 30k, only 0.15% fees, next best Cavendish 0.25%.
The info above suggests the fund is probably the best option.
The escape artist prefers etf's due to dividends but I'm not sure that matters too much as I want the balance to grow.

Novice_investor101

The only thing I'd be aware of as well is the effect of rounding if buying units in a Vanguard OEIC/fund.
Someone once explained it on here, but as 1 unit with Vanguard can be anything from £100 to £300 depending on the fund you may not purchase a full unit with your £100 & your platform rounding down can lead to a bit of your money disappearing into the ether rather than being reflected in your valuation.

[Deleted User]

Novice_investor101 wrote: »

The only thing I'd be aware of as well is the effect of rounding if buying units in a Vanguard OEIC/fund.
Someone once explained it on here, but as 1 unit with Vanguard can be anything from £100 to £300 depending on the fund you may not purchase a full unit with your £100 & your platform rounding down can lead to a bit of your money disappearing into the ether rather than being reflected in your valuation.

What do you mean by "disappearing into the ether"? I thought, when you have let's say £150 and one unit costs £100, then your order to purchase with £150 will purchase one unit and £50 will be left in your account. Nothing is "disappearing into the ether", right?

Novice_investor101

Here's one thread that explains it, there are others if you search for "vanguard rounding".

https://forums.moneysavingexpert.com/discussion/6066438/unit-pricing&highlight=vanguard+rounding

Alexland

Bruckner wrote: »

Does the cover apply to all OEIC funds or does it matter if they are UK, Ireland or elsewhere?

An open-ended investment company (OEIC) is a type of investment fund domiciled in the United Kingdom so you don't get them elsewhere.

jamels2 wrote: »

The escape artist prefers etf's due to dividends but I'm not sure that matters too much as I want the balance to grow.

Some ETFs pay distributions and others accumulate. Some OEICs are available in both Income and Accumulation classes. This is decided by the fund manager.

Alex

jamels2

Hey, thanks for the great replies. I think I am sold on the All-cap global index fund and will start paying into that. As I am just starting out, will this be OK on it's own or should I also put a percentage into a UK or global bond index? I have a 15-20 year plan to just accumulate so thinking maybe I don't need a bond index just yet, but I am a novice so will listen to advice??

ColdIron

pioruns wrote: »

I thought, when you have let's say £150 and one unit costs £100, then your order to purchase with £150 will purchase one unit and £50 will be left in your account.

Your £150 will purchase 1.5 units. Units are divisible, shares are not

Alexland

jamels2 wrote: »

should I also put a percentage into a UK or global bond index? I have a 15-20 year plan to just accumulate so thinking maybe I don't need a bond index just yet, but I am a novice so will listen to advice??

Depends on how much downside volatility you can cope with seeing. As a rule of thumb in a stock market crash 60% equities might drop 25%, 80% equities might drop 40% and 100% equities might drop 50% but it could be worse. If you can hold on and keep making regular contributions then you should be OK. However if you bottle it, give up, sell, don't have time to recover, etc then you might make an actual loss in which case you would be better off taking less risk. With 15-20 years to go then 80% equities seems reasonable derisking to 60% as you get into the final 7-10 years before withdrawal. But so much depends on the individual and circumstances.

Alex