Aviva pension funds - which world equity index fund?

PeteinSQ

Paul_Herring said:

PeteinSQ said:

It's a global index tracker but it has 60% invested in UK equities. How is that a global tracker? 

The 40% that isn't in UK equities? It's not technically inaccurate....

PeteinSQ said:

By contrast this looks to be a bit more balanced in terms of its distribution. Aviva Pensions Global Equity S6

That's the one I've got all my Aviva stuff in. (Current work's pension contributions; about 20% of my total pension funds. Rest is in Vanguard.)

Is the charge of 0.63% considered good for this sort of thing? 

Paul_Herring

Is the charge of 0.63% considered good for this sort of thing? 

Not especially, I think. That's why the rest of my stuff is in Vanguard.

PeteinSQ

BritishInvestor said:

PeteinSQ said:

BritishInvestor said:

PeteinSQ said:

Having read Lars Kroijer's work I have decided that I want to invest as described i.e. a mixture of global equities and UK bonds. 
The two key features of the required equity index fund are

1. that it should be allocated as per the relative size of the financial markets with no specific markets overweight
2. It should have the lowest possible fees

I appreciate that I could do this legwork myself but I wondered if anyone had already done this and could share their insight/research? 

The pension that I'm currently paying into is a lifestyle fund but it is maybe weighted too far towards bonds for my preference. I'd rather have 20% bonds and it seems to be quite a bit higher. I'm 38 so still quite a way off retirement.

Why just UK bonds?

To avoid currency risk?

vs a currency-hedged global bond fund?

I'm certainly not an expert investor, so I'm basing my thoughts on the views of Lars Kroijer. Won't the hedging come with additional costs? 

dunstonh

PeteinSQ said:

Paul_Herring said:

PeteinSQ said:

It's a global index tracker but it has 60% invested in UK equities. How is that a global tracker? 

The 40% that isn't in UK equities? It's not technically inaccurate....

PeteinSQ said:

By contrast this looks to be a bit more balanced in terms of its distribution. Aviva Pensions Global Equity S6

That's the one I've got all my Aviva stuff in. (Current work's pension contributions; about 20% of my total pension funds. Rest is in Vanguard.)

Is the charge of 0.63% considered good for this sort of thing? 

Its not unreasonable when you remember that its the bottom line.   However, you can get cheaper (including from Aviva)

PeteinSQ

dunstonh said:

PeteinSQ said:

Paul_Herring said:

PeteinSQ said:

It's a global index tracker but it has 60% invested in UK equities. How is that a global tracker? 

The 40% that isn't in UK equities? It's not technically inaccurate....

PeteinSQ said:

By contrast this looks to be a bit more balanced in terms of its distribution. Aviva Pensions Global Equity S6

That's the one I've got all my Aviva stuff in. (Current work's pension contributions; about 20% of my total pension funds. Rest is in Vanguard.)

Is the charge of 0.63% considered good for this sort of thing? 

Its not unreasonable when you remember that its the bottom line.   However, you can get cheaper (including from Aviva)

Any chance you could point me in the right direction (within Aviva)?

AlanP_2

Is this an employer scheme as they may have a discounted fee arrangement in place?

PeteinSQ

AlanP_2 said:

Is this an employer scheme as they may have a discounted fee arrangement in place?

It is an employer scheme. I'm pretty certain that the fund we're in right now does have a discounted fee arrangement. Would that be spelled out in the fund factsheet or would I need to double check with Aviva? 

Paul_Herring

Is this an employer scheme as they may have a discounted fee arrangement in place?

Mine? Yes, employer scheme, no idea if there's a discounted fee...

Last statement I had from them (Dated 31 July '20):

Annual fund charge: 0.56%

Fund manager expense charge: 0.03%

(Strangely the FMEC is "rounded to the nearest 0.05%" - not sure if that's a typo and should read 0.005%, but there's other numbers in that paragraph with similar percentages (more mentions of 0.05% and 0.025%,) or simply incorrect and they haven't rounded it.)

Dividing the charges by (so the actual will be between these)

• Transfer value at statement date: 0.443%
• Previous statement value: 0.754%

So that puts the 0.59% in the ballpark, and it's not that far off the 0.63% cited.

(Then again, elsewhere we get into fantasy numbers on that statement. "My plan could be worth £335K at retirement" (no, because I'll be retiring early) and "could pay £447 a month" (a withdrawal rate of 1.7% - lol)).

BritishInvestor

PeteinSQ said:

BritishInvestor said:

PeteinSQ said:

BritishInvestor said:

PeteinSQ said:

Having read Lars Kroijer's work I have decided that I want to invest as described i.e. a mixture of global equities and UK bonds. 
The two key features of the required equity index fund are

1. that it should be allocated as per the relative size of the financial markets with no specific markets overweight
2. It should have the lowest possible fees

I appreciate that I could do this legwork myself but I wondered if anyone had already done this and could share their insight/research? 

The pension that I'm currently paying into is a lifestyle fund but it is maybe weighted too far towards bonds for my preference. I'd rather have 20% bonds and it seems to be quite a bit higher. I'm 38 so still quite a way off retirement.

Why just UK bonds?

To avoid currency risk?

vs a currency-hedged global bond fund?

I'm certainly not an expert investor, so I'm basing my thoughts on the views of Lars Kroijer. Won't the hedging come with additional costs? 

Potentially, but you can get currency-hedged global bond funds for ~15bps, so pretty competitive.

AlanP_2

PeteinSQ said:

AlanP_2 said:

Is this an employer scheme as they may have a discounted fee arrangement in place?

It is an employer scheme. I'm pretty certain that the fund we're in right now does have a discounted fee arrangement. Would that be spelled out in the fund factsheet or would I need to double check with Aviva? 

It wopn't be in the factsheet as that will be "List Price" as it were, Aviva could probably tell you what discount youir scheme gets but apart from academic interest is it going to make a difference if you know?