Vanguard Life Strategy 100% fund

GeoffTF

dunstonh said:

GeoffTF said:

dunstonh said:

Actively managed funds charge more the VLS, and usually have less diversified portfolios.

No they don't.   Take the HSBC GS range.  Cheaper than VLS but slightly more active.

Although with VLS's decision to go underweight in some areas and overweight in others and remain rigid in the equity split are active decsions.

HSBS GS is a LifeStrategy lookalike. It is hardly more active than LifeStrategy. Neither fund is paying for stock picking.

It is not a lookalike.   VLS is a fettered fund of funds.  It has a rigid equity content and is not risk targetted.  HSBC is an unfettered fund of funds and is fluid with its weightings and is risk targetted.

They are very similar, and are aimed at the same market. Both hold a collection of index funds. VLS controls risk by maintaining a fixed percentage of bonds. HSBC GS by constraining the volatility to within a fixed range. Neither method of risk control is perfect. Both funds are both reasonable choices for the same purpose. The Vanguard OCFs are a little higher. It is not possible to compare the transaction costs, because there is no mandate for a common method of calculation. Nonetheless, volatility can change very quickly, so HSBC GS will probably have higher transaction costs. Vanguard has a better reputation than HSBC. You pays your money and you takes your pick.

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/h/hsbc-global-strategy-balanced-portfolio-c-accumulation

dunstonh

The Vanguard OCFs are a little higher. It is not possible to compare the transaction costs, because there is no mandate for a common method of calculation.   Nonetheless, volatility can change very quickly, so HSBC GS will probably have higher transaction costs.

The lack of a common calculation method is a major flaw with TCs.  However, currently, the MiFIDII reporting shows HSBC has lower TCs.

 Vanguard has a better reputation than HSBC. You pays your money and you takes your pick.

That is a matter of opinion.

HSBC were offering trackers in the UK long before Vanguard came to the UK (mid 90s on UT/OEICs for HSBC vs 2009 for VG)
Most HSBC trackers are cheaper than equivalent Vanguard trackers (e.g. US equity is 0.06% for HSBC but 0.10% for VG
Most HSBC trackers outperform their Vanguard equivalent (pretty much by the margin of the charges difference (since vanguard launch, US is 664.62% for HSBC and 654.77% for Vanguard).
Vanguard are more successful in getting the internet brigade to use them than HSBC are.  There is a cult behind Vanguard.   That is noticeable by how hard some try to make out that they are the only game in town.

In the scheme of things, those differences are minuscule but it does show that internet opinion and reality don't always align.

In my own portfolio, I have HSBC, Vanguard, Fidelity & iShares trackers.   I do not pray at the church of Vanguard.

GeoffTF

dunstonh said:

The Vanguard OCFs are a little higher. It is not possible to compare the transaction costs, because there is no mandate for a common method of calculation.   Nonetheless, volatility can change very quickly, so HSBC GS will probably have higher transaction costs.

The lack of a common calculation method is a major flaw with TCs.  However, currently, the MiFIDII reporting shows HSBC has lower TCs.

 Vanguard has a better reputation than HSBC. You pays your money and you takes your pick.

That is a matter of opinion.

HSBC were offering trackers in the UK long before Vanguard came to the UK (mid 90s on UT/OEICs for HSBC vs 2009 for VG)
Most HSBC trackers are cheaper than equivalent Vanguard trackers (e.g. US equity is 0.06% for HSBC but 0.10% for VG
Most HSBC trackers outperform their Vanguard equivalent (pretty much by the margin of the charges difference (since vanguard launch, US is 664.62% for HSBC and 654.77% for Vanguard -also indicates).
Vanguard are more successful in getting the internet brigade to use them than HSBC are.  There is a cult behind Vanguard.   That is noticeable by how hard some try to make out that they are the only game in town.

In the scheme of things, those differences are minuscule but it does show that internet opinion and reality don't always align.

In my own portfolio, I have HSBC, Vanguard, Fidelity & iShares trackers.   I do not pray at the church of Vanguard.

Many people see HSBC as serial miss-sellers and money launderers. Vanguard is clean on both of counts. Vanguard is a mutual, albeit owned by its US unit holders. Some see that as a plus. Vanguard used to be very idealistic, to the point of turning away business, but is becoming marketing driven. Vanguard also advertises heavily, and I expect that influences many people too. BlackRock has a good reputation.

eskbanker

GeoffTF said:

Many people see HSBC as serial miss-sellers and money launderers. Vanguard is clean on both of counts.

Many people would see it as inappropriate to make a lopsided comparison between a bank with an investment arm and an investment management company that offers no banking services, given where HSBC's high profile issues have arisen - it's not a million miles from the argument that you could slate Virgin Money products on the basis that their trains were rubbish!

dunstonh

Many people see HSBC as serial miss-sellers and money launderers. Vanguard is clean on both of counts.

its worth noting that Vanguard have been fined multiple times for breaches by regulators.  For example,
Finra fined Vanguard $350,000 in 2015 for reporting failures.   
BaFin fined 290,000 euros in 2021 for breach of regulations.
In March 2021, it was reported that a Vanguard compliance manager altered and fabricated documents to a regulator seeking information about the firms "contingency plan for responding to system outages."

All the big companies get fined periodically for breaches.   You would be hard pushed to find a single global financial company that hasn't had regulatory action at some point.       Where you employ staff, it is inevitable that a staff member will let you down at some point.   

GeoffTF

eskbanker said:

GeoffTF said:

Many people see HSBC as serial miss-sellers and money launderers. Vanguard is clean on both of counts.

Many people would see it as inappropriate to make a lopsided comparison between a bank with an investment arm and an investment management company that offers no banking services, given where HSBC's high profile issues have arisen - it's not a million miles from the argument that you could slate Virgin Money products on the basis that their trains were rubbish!

That is a fair point. Nonetheless, Vanguard is undoubtedly popular with retail investors. I believe that a common reason for that is that they trust Vanguard more than the others. Whether they are right to do so is another matter. The big banks' miss-selling in particular, sent the message that they only care about their profits and do not give to figs about their customers' interests. Vanguard, in contrast, used to refuse to sell products and services that it did not believe were good for their customers. Critics say that they are watering down their founding principles:

https://www.morningstar.com/articles/1071801/has-vanguard-lost-its-way

tebbins

dunstonh said:

GeoffTF said:

dunstonh said:

Actively managed funds charge more the VLS, and usually have less diversified portfolios.

No they don't.   Take the HSBC GS range.  Cheaper than VLS but slightly more active.

Although with VLS's decision to go underweight in some areas and overweight in others and remain rigid in the equity split are active decsions.

HSBS GS is a LifeStrategy lookalike. It is hardly more active than LifeStrategy. Neither fund is paying for stock picking.

It is not a lookalike.   VLS is a fettered fund of funds.  It has a rigid equity content and is not risk targetted.  HSBC is an unfettered fund of funds and is fluid with its weightings and is risk targetted.

In spite of which, the comparable funds (GS Balanced/VLS60) have behaved very similarly. "Risk targeted" is just more semantics, you could say that VLS are risk targeted, just that the 20-100% equity components are the result of the risk targeting - indeed that's probably where the numbers came from.
They are clearly very similar, intended to fill the same gap in the market, behave similarly, are widely acknowledged as alternatives/competitors/substitutes... Yet you seem to be asserting they are entirely different?
Anyway, I don't use any multi-asset/funds of funds myself, nor do I "pray at the church of Vanguard" (ad hominem and straw manning in a single comment!) and I appreciate that retail investors have a variety of choice and this forum to help inform that choice.

Thrugelmir

GeoffTF said:

dunstonh said:

The Vanguard OCFs are a little higher. It is not possible to compare the transaction costs, because there is no mandate for a common method of calculation.   Nonetheless, volatility can change very quickly, so HSBC GS will probably have higher transaction costs.

The lack of a common calculation method is a major flaw with TCs.  However, currently, the MiFIDII reporting shows HSBC has lower TCs.

 Vanguard has a better reputation than HSBC. You pays your money and you takes your pick.

That is a matter of opinion.

HSBC were offering trackers in the UK long before Vanguard came to the UK (mid 90s on UT/OEICs for HSBC vs 2009 for VG)
Most HSBC trackers are cheaper than equivalent Vanguard trackers (e.g. US equity is 0.06% for HSBC but 0.10% for VG
Most HSBC trackers outperform their Vanguard equivalent (pretty much by the margin of the charges difference (since vanguard launch, US is 664.62% for HSBC and 654.77% for Vanguard -also indicates).
Vanguard are more successful in getting the internet brigade to use them than HSBC are.  There is a cult behind Vanguard.   That is noticeable by how hard some try to make out that they are the only game in town.

In the scheme of things, those differences are minuscule but it does show that internet opinion and reality don't always align.

In my own portfolio, I have HSBC, Vanguard, Fidelity & iShares trackers.   I do not pray at the church of Vanguard.

 Vanguard is a mutual, albeit owned by its US unit holders. Some see that as a plus. 

Vanguard morphed out of an investment boutique. When Bogle identified an opportunity to exploit something no one else offered. Bogle himself died a multi millionaire. US individiuals are generally driven by money. 

coyrls

Thrugelmir said:

GeoffTF said:

dunstonh said:

The Vanguard OCFs are a little higher. It is not possible to compare the transaction costs, because there is no mandate for a common method of calculation.   Nonetheless, volatility can change very quickly, so HSBC GS will probably have higher transaction costs.

The lack of a common calculation method is a major flaw with TCs.  However, currently, the MiFIDII reporting shows HSBC has lower TCs.

 Vanguard has a better reputation than HSBC. You pays your money and you takes your pick.

That is a matter of opinion.

HSBC were offering trackers in the UK long before Vanguard came to the UK (mid 90s on UT/OEICs for HSBC vs 2009 for VG)
Most HSBC trackers are cheaper than equivalent Vanguard trackers (e.g. US equity is 0.06% for HSBC but 0.10% for VG
Most HSBC trackers outperform their Vanguard equivalent (pretty much by the margin of the charges difference (since vanguard launch, US is 664.62% for HSBC and 654.77% for Vanguard -also indicates).
Vanguard are more successful in getting the internet brigade to use them than HSBC are.  There is a cult behind Vanguard.   That is noticeable by how hard some try to make out that they are the only game in town.

In the scheme of things, those differences are minuscule but it does show that internet opinion and reality don't always align.

In my own portfolio, I have HSBC, Vanguard, Fidelity & iShares trackers.   I do not pray at the church of Vanguard.

 Vanguard is a mutual, albeit owned by its US unit holders. Some see that as a plus. 

US individiuals are generally driven by money. 

Is that right?  Thank you for that insight.