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VWRL ETF, VEVE or Global All Cap - or other? VLS accompaniment

Hi all

I have a fair holding of VLS80 and a bit of VLS100 through Vanguard's own platform, all in an S&S ISA. I'm looking to diversify a bit as the UK (and perhaps US) company weighting of these funds is a bit higher than I'd like. So, considering adding a bit of VWRL ETF (0.22% OCF), Global all cap fund (0.23% OCF) or even VEVE ETF (0.14%). The latter is attractive due to the lower fee, but it holds fewer stocks and has no exposure to emerging markets, probably limiting future increases in value. It also has a heavy US weighting, like VLS80. I'm looking to buy and forget, basically, (hence looking at VLS80 in the first place) though I do tend to top up every so often. I'm looking to reinvest dividends.

I've got a bit confused by all the options. (Dev world ex UK?) Can anyone suggest a good accompaniment to VLS80, given the current state of the world? Maybe I'm overcomplicating things and should just keep topping up VLS80. Or add some VLS60 in case of shock to the markets from US elections, Brexit etc.

Thank you.
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Comments

  • AlanP_2
    AlanP_2 Posts: 3,289 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Most people would look to add something that was missing from VLS80 e.g. Small Caps or Commercial Property, or Infrastructure if they were looking to complement it.

    What you appear to be aiming for is some mix of VLS80 / VLS100 (and possibly some VLS60) with the asset allocations tweaked to meet an undefined ratio that you may, or may not have calculated.

    Be clear on WHAT you want to hold and WHY. If the VLS range aren't giving you what youi want why are you using them? 

    Investing in something you don't want becuase the underlying platform is cheaper than another one is cutting off your nose to spite your face. 
  • Hi all

    I have a fair holding of VLS80 and a bit of VLS100 through Vanguard's own platform, all in an S&S ISA. I'm looking to diversify a bit as the UK (and perhaps US) company weighting of these funds is a bit higher than I'd like. So, considering adding a bit of VWRL ETF (0.22% OCF), Global all cap fund (0.23% OCF) or even VEVE ETF (0.14%). The latter is attractive due to the lower fee, but it holds fewer stocks and has no exposure to emerging markets, probably limiting future increases in value. It also has a heavy US weighting, like VLS80. I'm looking to buy and forget, basically, (hence looking at VLS80 in the first place) though I do tend to top up every so often. I'm looking to reinvest dividends.

    I've got a bit confused by all the options. (Dev world ex UK?) Can anyone suggest a good accompaniment to VLS80, given the current state of the world? Maybe I'm overcomplicating things and should just keep topping up VLS80. Or add some VLS60 in case of shock to the markets from US elections, Brexit etc.

    Thank you.
    Hi,
    I had a similar query recently. I was looking for some 'satellite' funds, just for a bit of diversification (although I was corrected in the use of this term) and to cover stuff the VLSs weren't really covering. I some money into a smaller caps fund, as suggested above, (JP Morgan US Small Cap Growth Fund). Unfortunately this dropped a bit after buying so the timing wasn't that great. Was also looking at Green/Clean energy/infrastructure, but haven't made a move on that yet. Current chatter on this forum has been about downturn in the markets, so I'm hanging fire with any further investments.
    Relative novice btw, so please don't take this as advice.



  • Albermarle
    Albermarle Posts: 24,504 Forumite
    10,000 Posts Sixth Anniversary Name Dropper
    Hi all

    I have a fair holding of VLS80 and a bit of VLS100 through Vanguard's own platform, all in an S&S ISA. I'm looking to diversify a bit as the UK (and perhaps US) company weighting of these funds is a bit higher than I'd like. So, considering adding a bit of VWRL ETF (0.22% OCF), Global all cap fund (0.23% OCF) or even VEVE ETF (0.14%). The latter is attractive due to the lower fee, but it holds fewer stocks and has no exposure to emerging markets, probably limiting future increases in value. It also has a heavy US weighting, like VLS80. I'm looking to buy and forget, basically, (hence looking at VLS80 in the first place) though I do tend to top up every so often. I'm looking to reinvest dividends.

    I've got a bit confused by all the options. (Dev world ex UK?) Can anyone suggest a good accompaniment to VLS80, given the current state of the world? Maybe I'm overcomplicating things and should just keep topping up VLS80. Or add some VLS60 in case of shock to the markets from US elections, Brexit etc.

    Thank you.
    You could have a smaller separate emerging markets fund . Some would say you would be better off with an actively managed fund in this area .
  • These are all basically global equity index funds and will all behave very similarly and probably produce very similar returns in the foreseeable future. Considering adding more different global equity index funds to a portfolio of global equity index funds adds 0 diversification.
    Personally I prefer vanguard global all cap, as it includes emerging markets (about 10% of the fund) and small cap (about another 10%), for completeness, but cheaper options are available (see @Alexland posts about the HSBC FTSE all world fund... Or ETF?)
    If you want something a little different, you could look at one of Vanguard's factor funds - personally I hold VVAL and VHYL, others may be more bullish on VMOM which is more growth oriented.
    If you want something very different you could look at at sector funds (real estate and infrastructure tend to behave quite differently to the general market), or the FTSE 250 which is a favourite of mine for a whole bunch of reasons.
  • csgohan4
    csgohan4 Posts: 10,600 Forumite
    Ninth Anniversary 10,000 Posts Name Dropper Photogenic
    For EM I personally use a seperate Active fund for this and use HMWO For the core global equity. but everyone has their own preferences and risk. 

    For absolute cost wise, then an all in one would be reasonable. They all track a global index and perform similarly, nothing stellar but you know it will perform reasonable well over time 
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"

    G_M/ Bowlhead99 RIP
  • If you don't need dividends, then swap VWRL for VWRP.
  • Alexland
    Alexland Posts: 9,804 Forumite
    Seventh Anniversary 1,000 Posts Photogenic Name Dropper
    edited 5 November 2020 at 7:05PM
    Personally I prefer vanguard global all cap, as it includes emerging markets (about 10% of the fund) and small cap (about another 10%), for completeness, but cheaper options are available (see @Alexland posts about the HSBC FTSE all world fund... Or ETF?)
    I also think the Global All Cap is a good fund for those with small accounts on the Vanguard platform (although the tools I use report the small cap nearer 5%) mixing with a bond fund as appropriate. On larger accounts on fixed price platforms that offer more choice I prefer the HSBC All World fund.
    csgohan4 said:
    For EM I personally use a seperate Active fund for this and use HMWO For the core global equity. but everyone has their own preferences and risk. 
    We also hold World ETFs including VEVE, HMWO and LCWL in our Fidelity and AJ Bell accounts (for the capped platform fees) with EM and bond funds via our workplace pensions. Its not ideal to have the EM separate but the cost difference on a large account makes it a worthwhile compromise.
  • csgohan4
    csgohan4 Posts: 10,600 Forumite
    Ninth Anniversary 10,000 Posts Name Dropper Photogenic
    The reason I have it separate, is I can choose to have more weighting to specific regions I want, and active fund manager which hopefully will help for the volatility as EM in theory is more risky
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"

    G_M/ Bowlhead99 RIP
  • Thanks for your thoughts, all.
    I am generally happy with the VLS80, but just looking to move away from the UK / US weighting a bit, as I think these areas may perform poorly in future. I may of course be wrong...
    Not really looking to go active, at least at this point, as I'm not convinced it adds much value, given the higher charges.
    It seems that Vanguard / NSI have delayed my ISA transfer anyway, so I have time to research further!
  • Thanks for your thoughts, all.
    I am generally happy with the VLS80, but just looking to move away from the UK / US weighting a bit, as I think these areas may perform poorly in future. I may of course be wrong...
    Not really looking to go active, at least at this point, as I'm not convinced it adds much value, given the higher charges.
    It seems that Vanguard / NSI have delayed my ISA transfer anyway, so I have time to research further!
    /
    The US isn't weighted any which way, that's just how ridiculously huge the US equity market is. I agree with you that the US is likely to be one of the poorer performers in the foreseeable future given the current valuations, but not the UK, for academic reasons that don't belong in this thread. What you could do is buy vanguard's regional funds to alter the weights of your Portfolio. But this is perhaps unnecessarily complicated, it's market timing, and you're getting into the business of having to decide in future that things are "back to normal" such that a vanilla global index fund is what you want.
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