Vanguard ETFs - Whats the difference and which to choose...

RD42

Hi All,
Vanguard (at least on my ii.co.uk SIPP acount) seem to offer the same ETF in a number of forms, for example:

• Vanguard FTSE North America UCITS ETF

• Vanguard FTSE North America UCITS ETF GBP

• Vanguard FTSE North America UCITS ETF USD Accumulation GBP

Whats the difference between these?

ffacoffipawb

RD42 said:

Hi All,
Vanguard (at least on my ii.co.uk SIPP acount) seem to offer the same ETF in a number of forms, for example:

• Vanguard FTSE North America UCITS ETF

• Vanguard FTSE North America UCITS ETF GBP

• Vanguard FTSE North America UCITS ETF USD Accumulation GBP

Whats the difference between these?

Dollars, Sterling and Accumulation (no dividends paid out) respectively.

RD42

When you say "Dollars" and "Sterling" what does that mean for an investor.  If I bought £1000 of each of the first two in my SIPP and the FTSE North America went up 10% which one would I have been better off with?    I assume that the investment would be converted into $ in both cases, so why have two options?

jamesd

It often costs foreign exchange fees for purchase, sale and dividends in USD. None if using the GBP version.

[Deleted User]

RD42 said:

When you say "Dollars" and "Sterling" what does that mean for an investor.  If I bought £1000 of each of the first two in my SIPP and the FTSE North America went up 10% which one would I have been better off with?    I assume that the investment would be converted into $ in both cases, so why have two options?

The return on your shares will be exactly the same because both ETFs hold the exact same assets.  However your brokerage might be dealing in sterling only, so there will be currency exchAnge costs for distributions and any purchases and sales of ETF shares for the USD option. You should buy the sterling option rather than USD unless you have a USD brokerage account.

george4064

Deleted_User said:

RD42 said:

When you say "Dollars" and "Sterling" what does that mean for an investor.  If I bought £1000 of each of the first two in my SIPP and the FTSE North America went up 10% which one would I have been better off with?    I assume that the investment would be converted into $ in both cases, so why have two options?

The return on your shares will be exactly the same because both ETFs hold the exact same assets.  However your brokerage might be dealing in sterling only, so there will be currency exchAnge costs for distributions and any purchases and sales of ETF shares for the USD option. You should buy the sterling option rather than USD unless you have a USD brokerage account.

Would just add that some ETFs priced in GBP pay distributions in USD, so your platform will charge a FX fee to convert the distribution to GBP (unless it’s held with a platform within a General Investment Account that allows clients to hold foreign currencies within).

RD42

Thank you for the replies.