Thinking of investing in tracker funds

uknick

For some time I've been thinking about buying some tracker funds but have always got confused (and to be honest a little scared) by the number and type of them and the myriad of suppliers.

I use my investments to try to maximise the return on part of my long term savings and can afford to lose any investment.  After I invest in some funds my investments will be about 10% of my overall capital.  I'm already invested in about 20 individual FTSE 100 shares within a S&S ISA on the iWeb platform.  I purchased the shares purely on the basis of dividend return and they're currently giving me a 4% annual return ignoring capital growth/loss.  Prior to recent events they were about break even on the capital value. Of course recent events means the capital value has tanked, but as I'm not looking to sell at anytime soon I can live with that.

I've looked at the Vanguard products and, for no particular reason other than a start point for discussion, wondered about these funds;

FTSE 100 index unit trust
FTSE U.K. All Share Index Unit Trust
FTSE 100 UCITS ETF
FTSE 250 UCITS ETF

I'm not sure about the FTSE ones. I was thinking of having FTSE 100 and FTSE 250 trackers and wanted the dividends to be re-invested in the funds.  But, Vanguard only do these as ETFs, which can't automatically re-invest dividends.  I suppose I could build up a dividend balance in my account and buy more units when the fund gets big enough.

U.S. Equity Index Fund
Emerging Markets Stock Index Fund
Pacific ex-Japan Stock Index Fund

With regard to buying the funds, I'll be putting in lump sums when some regular saver account mature in the nearish future. My current thinking to to put equal amounts across the funds.

Thoughts on this, particularly on whether to go with the FTSE ETF or index funds.

dunstonh

FTSE 100 index unit trust
FTSE U.K. All Share Index Unit Trust
FTSE 100 UCITS ETF
FTSE 250 UCITS ETF

FTSE100 is a dire index.

FTSE250 is focused in medium sized companies

If you are going to use single sector funds, then you need to balance the portfolio better.   Also, unless you are heading towards £100k invested, there really is no point going with single sector funds.  You should stick with multi-asset funds.

CreditCardChris

dunstonh

FTSE100 is a dire index.

bUt DiViDeNdS! /s
 Seriously though it's nice to finally see a veteran of this forum acknowledge the pile of turd that is the FTSE100.

Thrugelmir

CreditCardChris said:

dunstonh

FTSE100 is a dire index.

bUt DiViDeNdS! /s
 Seriously though it's nice to finally see a veteran of this forum acknowledge the pile of turd that is the FTSE100.

Shows how little you know about markets in general. What's your view on the S&P 500? 

dunstonh

CreditCardChris said:

dunstonh

FTSE100 is a dire index.

bUt DiViDeNdS! /s
 Seriously though it's nice to finally see a veteran of this forum acknowledge the pile of turd that is the FTSE100.

Finally?
I have said the FTSE100 has been dire since this website began.    It is you, based on your other threads, that cannot tell the difference between large cap, mid cap and small cap.

bowlhead99

Thrugelmir said:

CreditCardChris said:

dunstonh

FTSE100 is a dire index.

bUt DiViDeNdS! /s
 Seriously though it's nice to finally see a veteran of this forum acknowledge the pile of turd that is the FTSE100.

Shows how little you know about markets in general. What's your view on the S&P 500? 

Seems like there are tens of threads by CCC showing that he is eager to learn, but that he's quite far from getting there. 

On FTSE vs S&P we have been there before  
https://forums.moneysavingexpert.com/discussion/6077626/s-p-index-tracker-vs-ftse-dividend-fund#latest

uknick

Thanks for the input.  I'll read the SP V FTSE thread and research multi asset funds.

Albermarle

FTSE250 is focused in medium sized companies

Not doing very well in this downturn at all . Presumably it is due to the reason behind the downturn that will probably hit these businesses particularly hard.

Username999

uknick said:

Thanks for the input.  I'll read the SP V FTSE thread and research multi asset funds.

Try researching entry requirements for both S&P500 and FTSE100.
And if you still want to "invest" in a "Index Tracker" research ones that fit your objective, not some internet poster that has his/her own objectives.
IMHO

Thrugelmir

Albermarle said:

FTSE250 is focused in medium sized companies

Not doing very well in this downturn at all . Presumably it is due to the reason behind the downturn that will probably hit these businesses particularly hard.

Cineworld is down around 70% in the past month alone. 

bowlhead99

uknick said:

Thanks for the input.  I'll read the SP V FTSE thread and research multi asset funds.

The thread wasn't linked as a great example of something good to read  

Researching multi asset funds is a decent approach. There is no point trying to build your own portfolio from lots of individual specialist indexes for equities in UK, Europe, US, Japan, Asia ex-Japan, Emerging Markets and then also government bonds, corporate investment grade bonds, high yield bonds, domestic bonds, international developed-world bonds, emerging market bonds, long dated bonds, short dated bonds,  commercial real estate etc etc etc and wondering what ratios to use for each proportion. Buy a product that someone else has built, to save you the legwork.