M&G/Vanguard

dustyroad46

I currently hold accumulation shares in the M&G uk select fund. There are 42 holdings in this fund and the bench mark for this fund is the FTSE all share index. M&G ongoing charge is 0.95%. Vanguard have the FTSE UK all share index with 591companies with ongoing charge of 0.06%.
Is the FTSE all share index different from the FTSE UK all share index and if not why should I continue with M&G with the higher ongoing charge.

Albermarle

The Vanguard fund actually follows the FTSE UK all share index .

The M&G fund has selected 42 holdings that it thinks will do well, so it is a managed fund where the manager is picking and choosing stocks . The fact that it is benchmarked against FTSE all share is not really of any relevance to its performance.

You are comparing apples with pears.

dustyroad46

Sourced from M&G

Alexland

With vanguard you will also pay a platform charge of 0.15% so with their All Share tracker at 0.06% that would be 0.21% total compared to the 0.95% you are currently paying assuming you are holding direct with M&G not via another platform etc. So yes you would save ongoing charges, get a similar performing investment, but investing all you money in the UK market isn't really how most people would do it these days as the general direction over the past 20 years has been for more global diversification.

dustyroad46

I also hold M&G global themes fund, plus Vanguard L/S 60/40 and Vanguard FTSE all cap.

tebbins

FTSE all share / FTSE UK all share are the same.

The index is just a way of measuring themselves against a common benchmark for UK equity funds. It doesn't actually mean anything and comparing it with the FTSE all share doesn't really tell you anything other than how it behaves vs that index, it gives no indication of its suitability for you or how it will behave in future, or its future returns.

There is no one objective way of working out if one investment is objectively better than another.