Is there lag in index tracker valuation?

[Deleted User]

Hi all,

I'm invested in the HSBC FTSE All-World index (https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/h/hsbc-ftse-all-world-index-class-c-accumulation/charts). It's revalued once a day at midday UK time. 

I have noticed during the volatility of the last few days that there is a strange lag. For instance, markets rose yesterday (6 December) all over the world, and the benchmark that the fund is supposd to be tracking is currently also a little up over yesterday: (see here: https://finance.yahoo.com/quote/AW01.FGI/)

However today (7 December) the fund's daily revaluation resulted in it slightly losing value over yesterday. I can't understand why this would be. The benchmark is up, so why is the fund down? I would have expected a change to feed immediately into the price at the next daily revaluation? Obviously there will be tracking error but this looks more like there is a lag.

Sorry if I'm missing something extremely obvious but I can't for the life of me work it out!!

EthicsGradient

The Yahoo chart is in US dollars. The HL chart for the fund is in pounds, so the pound/dollar movement must be taken into account too.

Prism

Also you need to compare against the same valuation period. So UK time midday until midday. A good performance on a single day sometimes just reverses a poor performance the day before

coastline

If you trade the ETF VWRL in real time you should see 9050 midday Friday and 9000 midday on Monday. Currently up at 9250 so your HSBC tracker should be up in theory Wednesday around 2%.

Vanguard FTSE All-World ETF, UK:VWRL Advanced Chart - (LON) UK:VWRL, Vanguard FTSE All-World ETF Stock Price - BigCharts.com (marketwatch.com)

Here's another tip to save confusion. The following chart takes into account real time and the futures market . Set the chart to 1 week and note the price in UK time at 4.30pm . As the UK is closed it will take the lead from the US market when it reopens at 8am the following day then generally follow the US. Today for example since yesterday 4.30pm the US is up 1.5% and the UK similar.

United States Stock Market Index (US30) | 2021 Data | 2022 Forecast (tradingeconomics.com)

Thrugelmir

Deleted_User said:

It's revalued once a day at midday UK time. 

Is that the published time rather than the actual revalued time? Their be some work behind the scenes to determine the fund price not just a push of the button. I'd expect the revaluation to be performed in the morning (UK time) after the Asian markets have closed.