Opinions on these Vanguard combinations on Vanguard platform

mears1

Which of these Vanguard combinations would you choose to buy and hold for 10-15 years? And why?

1. Ftse All world ETF Income version (VWRL)             (vanguard don’t do acc version). Seems to be a popular choice.

2.Ftse Developed world Ucits ETF (VEVE) combined with Ftse Emerging market Ucits ETF (?10%) (VFEM)

3.Vanguard Ftse developed world ex uk  combined with Ftse UK all sharetracker (?10%)?

Would really benefit from any kind and direct informative answers for my limited investment understanding!

eskbanker

As ever, much will depend on your objectives and strategy, as it's impossible to say what's best in a vacuum - if you're looking to hold global equities and (implicitly) prefer to reinvest dividends and wish to use Vanguard products, then the most obvious starting point would probably be their FTSE Global All Cap fund:

https://www.vanguardinvestor.co.uk/investments/vanguard-ftse-global-all-cap-index-fund-gbp-acc/overview

If you feel you need something different from that, and there are many reasons why that might be the case (geographic allocation, OEIC v ETF, OCF, market caps, etc), then it would help to understand what your rationale is, so that people can help with finding something that meets your requirements....

tebbins

Personally none, but they're all fine.

Iuse Vanguard FTSE Global All Cap as it is more "complete" than the FTSE All-World for my global equity exposure, the differences are explained in the graphic below, and you don't need to add the UK or emerging markets, it's all in there already. However, if you wanted some UK home bias, which most do and can make some sense (see page 5 of https://corporate.vanguard.com/content/dam/corp/research/pdf/Global-equity-investing-The-benefits-of-diversification-and-sizing-your-allocation-US-ISGGEB_042021_Online.pdf), VLS100 is around 25% weighted towards the UK, vs 4% in the FTSE Global All Cap. There areplenty other options available, no need to restrict yourself to just Vanguard (e.g. see https://monevator.com/passive-fund-of-funds-the-rivals/).
HSBC FTSE All-World is another cheap and popular global tracker.

kempiejon

I do not use the Vanguard platform but use their ETFs.
I hold VWRP - the accumulation version in an iWeb account.
In another account I hold VERX, VUSA, VFEM, VJPN, VAPX in ratios to approximately match VWRL/VWRP but I exclude the UK in my Europe weighting as I invest directly in FTSE 350 shares.
It works out a tiny bit cheaper to split global coverage like that.
I understand another method is to hold the Vanguard developed world and emerging markets as per the OPs choice 2.

I think any sort of global cover is going to be broadly similar, charges and number of holdings in each product will drive any longer term differences. As mentioned above not all global indices are the same.

mears1

Looking for a very low ongoing charge global tracker because the intention is to leave it in Vanguard’s Sipp for 10-15 year.  I would prefer Accumulation OEIC but If there happened to be a drop in the market (I know it is a NO-NO), I would use an etf for speed to benefit, although  Vanguard’s etfs on their platform are all income. Not in a hurry to invest.

Previously, put off by the performance of The Ftse Global All cap being comparable to the cheaper trackers VWRL and VEVE whilst being the Ftse Global All cap is a bit more expensive. But now it might be a good option as it doesn’t need managing!

Linton

I share eskbanker's and tebbins' preference for Vanguad FTSE Global AllCap for greater diversification.  There seems no point in choosing multiple index funds to get some different allocation to what is provided by a single global fund if you do not have the experience to make a rational choice.

Another factor is the size of your investment.  I would not choose 100% equity for a time period as potentially short as 10 years for money that really matters.  If you are talking about a £10K lump sum that you could otherwise keep as cash  in a fixed term account whatever you choose won't be life changing and wont make a significant difference.  Just don't do anything stupid, which you aren't planning to do anyway. However if you are talking about a £M inheritance I suggest you seek professional advice.

tigerspill

How does HSBC's FTSE All World Index C Acc compare with Vanguards FTSE Global All Cap in terms of diversity?

ChilliBob

Look at the banker on wheels website which shows the comparison quite well. Basically the latter is more complete. More expensive though. Personally I went with the former, and Fidelity world P. 

I'd avoid the - UK one, the consensus seems to be the UK isn't doing too bad for a change, so perhaps its fate has turned a corner for a while.

If minimising fees and maximising coverage the veve + slice of EM is the way to go. You'll need to factor in rebalancing though to stick to your chosen ratio. 

tebbins

Well the FTSE all world is a $67tn index containing 4,130 companies, and the FTSE global all cap is a $75tn index containing a further 5,342 companies, so that's how it's more diverse. There is also some historical evidence, which is not consistently true and may not repeat, of small caps slightly outperforming larger/mid caps. Adding small caps can, though very slightly, not consistently and maybe not in future, actually decrease the overall volatility of a portfolio because small caps tend to be less correlated with larger cap equities than larger cap equities are with each other.

CheekyMikey

My equity pf has something like your third option. VG Dev World ex Uk and VG UK Equity Income…I also have separate emerging market, UK small cos and global small cos funds. Could I consolidate into an all world tracker and get more balanced diversification? I guess so, but I haven’t simply because these have worked well for me for years. No doubt there will be better, maybe more cost effective ways I could invest but for now I just let it ride…

eskbanker

CheekyMikey said:

My equity pf has something like your third option. VG Dev World ex Uk and VG UK Equity Income…I also have separate emerging market, UK small cos and global small cos funds. Could I consolidate into an all world tracker and get more balanced diversification? I guess so, but I haven’t simply because these have worked well for me for years. No doubt there will be better, maybe more cost effective ways I could invest but for now I just let it ride…

But in the same way as OP, 'more balanced diversification' is subjective and dependent entirely on what you want the balance to be - an all world tracker will typically be weighted according to free float market capitalisation but it's completely legitimate to prefer more UK, or more small caps, or whatever, as long as you have some sort of rationale for doing so.