Vanguard funds - which to choose

IanManc

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

grumiofoundation said:

zagfles said:

Albermarle said:

  Vanguard are the huge business they are because their products and services work well and are deliberately kept simple to use.

Not disputing this statement, but the VLS funds have been underperforming one of their main competitor in the UK for these type of low cost multi asset funds. . The HSBC global strategy funds. Also they are cheaper.

Not a whole lot in it, and in future may be different, but worth noting.

The main reason for this appears to be the HSBC funds are more US biased and the Vanguard ones more UK biased, and US equities have done better than UK.

Look at the geographical equity makeup of the HSBC funds in the facsheets, the equities portion is well over 50% US whereas Vanguard are around 30% US. Personally, I don't think over 50% US is very balanced even if it does reflect market cap.

Not sure where you got this data from?

VLS 100 

Vanguard U.S. Equity Index Fund GBP Acc	19.4%
Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc*	19.3%
Vanguard FTSE U.K. All Share Index Unit Trust GBP Acc	19.2%
Vanguard S&P 500 UCITS ETF (USD) Accumulating	15.3%

*of which ~70% is US

so 19.4 + (19.3*0.7) + 15.3 = 48.1

VLS 60 contains the following

Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc	19.3%
Vanguard U.S. Equity Index Fund GBP Acc	15.3%

(19.3*0.7) + 15.3 = 28.8 

Again 28.8 = 48% of 60



For HSBC adventurous (80% equity) factsheet is just over 50% US equity. So equity portion would be 63%. 

I just looked at HL's geographical breakdown here which says VLS100 is 31.12% US:

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/v/vanguard-lifestrategy-100-equity-income

The HL figure is incorrect. Grumio's figures are right.

VLS100 investments as at 30.6.22 included 19.3% in Vanguard US fund; 15.3% in Vanguard S&P 500 fund; and 19.3% in Vanguard Developed World ex UK fund, of which 69.5% was US investments, i.e. 13.4% of VLS100; giving a total proportion of VLS100 invested in US equities of 48.1%.

The HL page you refer to also says that 16.7% of VLS100 investments are in Ireland, which is laughable. Investments in Ireland are found in two VLS100 components. They are Vanguard Developed World ex UK at 0.1% of a 19.3% investment, and Vanguard developed Europe ex UK at 0.4% of a 7% investment; giving a total proportion of VLS100 invested in Ireland of 0.0473%, not the 16.7% suggested by HL

LifeStrategy® 100% Equity Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed World ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed Europe ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)

Well whatever the exact amounts are, my point was that VLS100 is significantly less US, even on your figures (48% vs 63%), and significantly more UK than HSBC, and that's almost certainly the reason for its underperformance. Plus as mentioned above the strengthening of the USD.

It hasn't underperformed. It is a different fund doing a different job. The two series of funds have different remits. One follows fixed compositions of equities and bonds, with a home bias the the UK; and the other changes composition in the hope of targeting and maintaining a specific level of risk.

The series of funds will never mirror each other in terms of performance and no one who understands what they are designed to do and how they are constructed would expect them to. Your suggestion of underperformance is like suggesting an apple underperforms a pear. 

Read the post I replied to. It wasn't my suggestion, it was Albermarle's who said "... but the VLS funds have been underperforming one of their main competitor in the UK...".
We're actually making the same point, ie they are different funds with different constituents and different remits so a comparison of performance is indeed like comparing an apple and pear. I quite agree. That was my point.
But well done on pointing out the exact apply'ness and pear'ness of the funds I suggest you inform HL.

You were replying to my post, not Albermarle's when you mentioned the "underperformance" of VLS. Everyone can see that.

Well we're both technically correct. A pear can underperform an apple, for instance a pear underperfoms an apple at "roundness". Things can be compared even if they are constituted differently and have different objectives you know.

I was just pointing out that they are different. And you agreed, although you want to make a big deal about the exact extent of the difference. Go for it, if you think it makes you look smart.

And if you want HL to be informed of their shortcomings then I suggest you do it it. After all, it's your idea not mine, and it was you who was using a link to their site to support your posting of misinformation on here as to the composition of VLS100. 😉

CBA. You say they're wrong, you tell them. I've not checked your figures, because I really don't care, I was just pointing out the funds are different. You don't dispute that, you just want to make a big deal about HL being wrong. So tell them, not me.

Have a lovely evening and don't let the heat get to you.

Oh right. You care enough about the composition of VLS100 to post misinformation twice, but when it is pointed out that you are wrong you "really don't care".

I'm not convinced and no one else will be either.

I posted links to Vanguard's site where they give their figures for the composition of their funds on 30.6.2022, and they show your postings were wrong. You're the one who relied on HL for your information, not me. And telling them they're wrong is your idea not mine. If you "CBA" then why were you bothered enough to post the suggestion?

That's not very convincing either.

Probably time for you to stop digging.

zagfles

IanManc said:

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

grumiofoundation said:

zagfles said:

Albermarle said:

  Vanguard are the huge business they are because their products and services work well and are deliberately kept simple to use.

Not disputing this statement, but the VLS funds have been underperforming one of their main competitor in the UK for these type of low cost multi asset funds. . The HSBC global strategy funds. Also they are cheaper.

Not a whole lot in it, and in future may be different, but worth noting.

The main reason for this appears to be the HSBC funds are more US biased and the Vanguard ones more UK biased, and US equities have done better than UK.

Look at the geographical equity makeup of the HSBC funds in the facsheets, the equities portion is well over 50% US whereas Vanguard are around 30% US. Personally, I don't think over 50% US is very balanced even if it does reflect market cap.

Not sure where you got this data from?

VLS 100 

Vanguard U.S. Equity Index Fund GBP Acc	19.4%
Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc*	19.3%
Vanguard FTSE U.K. All Share Index Unit Trust GBP Acc	19.2%
Vanguard S&P 500 UCITS ETF (USD) Accumulating	15.3%

*of which ~70% is US

so 19.4 + (19.3*0.7) + 15.3 = 48.1

VLS 60 contains the following

Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc	19.3%
Vanguard U.S. Equity Index Fund GBP Acc	15.3%

(19.3*0.7) + 15.3 = 28.8 

Again 28.8 = 48% of 60



For HSBC adventurous (80% equity) factsheet is just over 50% US equity. So equity portion would be 63%. 

I just looked at HL's geographical breakdown here which says VLS100 is 31.12% US:

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/v/vanguard-lifestrategy-100-equity-income

The HL figure is incorrect. Grumio's figures are right.

VLS100 investments as at 30.6.22 included 19.3% in Vanguard US fund; 15.3% in Vanguard S&P 500 fund; and 19.3% in Vanguard Developed World ex UK fund, of which 69.5% was US investments, i.e. 13.4% of VLS100; giving a total proportion of VLS100 invested in US equities of 48.1%.

The HL page you refer to also says that 16.7% of VLS100 investments are in Ireland, which is laughable. Investments in Ireland are found in two VLS100 components. They are Vanguard Developed World ex UK at 0.1% of a 19.3% investment, and Vanguard developed Europe ex UK at 0.4% of a 7% investment; giving a total proportion of VLS100 invested in Ireland of 0.0473%, not the 16.7% suggested by HL

LifeStrategy® 100% Equity Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed World ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed Europe ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)

Well whatever the exact amounts are, my point was that VLS100 is significantly less US, even on your figures (48% vs 63%), and significantly more UK than HSBC, and that's almost certainly the reason for its underperformance. Plus as mentioned above the strengthening of the USD.

It hasn't underperformed. It is a different fund doing a different job. The two series of funds have different remits. One follows fixed compositions of equities and bonds, with a home bias the the UK; and the other changes composition in the hope of targeting and maintaining a specific level of risk.

The series of funds will never mirror each other in terms of performance and no one who understands what they are designed to do and how they are constructed would expect them to. Your suggestion of underperformance is like suggesting an apple underperforms a pear. 

Read the post I replied to. It wasn't my suggestion, it was Albermarle's who said "... but the VLS funds have been underperforming one of their main competitor in the UK...".
We're actually making the same point, ie they are different funds with different constituents and different remits so a comparison of performance is indeed like comparing an apple and pear. I quite agree. That was my point.
But well done on pointing out the exact apply'ness and pear'ness of the funds I suggest you inform HL.

You were replying to my post, not Albermarle's when you mentioned the "underperformance" of VLS. Everyone can see that.

Well we're both technically correct. A pear can underperform an apple, for instance a pear underperfoms an apple at "roundness". Things can be compared even if they are constituted differently and have different objectives you know.

I was just pointing out that they are different. And you agreed, although you want to make a big deal about the exact extent of the difference. Go for it, if you think it makes you look smart.

And if you want HL to be informed of their shortcomings then I suggest you do it it. After all, it's your idea not mine, and it was you who was using a link to their site to support your posting of misinformation on here as to the composition of VLS100. 😉

CBA. You say they're wrong, you tell them. I've not checked your figures, because I really don't care, I was just pointing out the funds are different. You don't dispute that, you just want to make a big deal about HL being wrong. So tell them, not me.

Have a lovely evening and don't let the heat get to you.

Oh right. You care enough about the composition of VLS100 to post misinformation twice, but when it is pointed out that you are wrong you "really don't care".

I'm not convinced and no one else will be either.

I posted links to Vanguard's site where they give their figures for the composition of their funds on 30.6.2022, and they show your postings were wrong. You're the one who relied on HL for your information, not me. And telling them they're wrong is your idea not mine. If you "CBA" then why were you bothered enough to post the suggestion?

That's not very convincing either.

Probably time for you to stop digging.

Oh dear, are really you obsessed about this aren't you? I said VLS was around 30%, someone asked where I got the figures from, so I posted a link to the HL website where I got the info from. Perhaps one of the biggest UK investment platforms are right about the exact percentage, or perhaps a couple of random MSE posters are right, but I don't care, because the point I was making is correct and not in dispute, ie that the HSBC funds have a higher US and lower UK weighting and that is the likely explaination for the performance difference.

Anyway, believe what you want, we're through with this pointless little sidetrack. Ta ta.

Cus

I think @zagfles has inferred an incorrect view in my opinion. The difference in performance is very likely to be linked to a UK bias for vanguard, that has led to a reduced performance. The HSBC fund performs an appropriate balance based on market caps so is not US biased, but actually correctly weighted.

missymouse

So would you recommend the HSBC fund for 2023/24 as oppose to Vanguard 

dunstonh

So would you recommend the HSBC fund for 2023/24 as oppose to Vanguard 

You don't know which of the multi-asset funds with underlying passives will be best in any one tax year.  In any single year, one could be better than the other.   However, HSBC GS is cheaper and has outperformed VLS in more discrete periods than the other way around.  On paper, HSBC is probably the better technical option (cheaper, unfettered and risk targetted vs more expensive, fettered and not risk targetted), but it is a bit like picking between two Granny Smith apples.

IanManc

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

IanManc said:

zagfles said:

grumiofoundation said:

zagfles said:

Albermarle said:

  Vanguard are the huge business they are because their products and services work well and are deliberately kept simple to use.

Not disputing this statement, but the VLS funds have been underperforming one of their main competitor in the UK for these type of low cost multi asset funds. . The HSBC global strategy funds. Also they are cheaper.

Not a whole lot in it, and in future may be different, but worth noting.

The main reason for this appears to be the HSBC funds are more US biased and the Vanguard ones more UK biased, and US equities have done better than UK.

Look at the geographical equity makeup of the HSBC funds in the facsheets, the equities portion is well over 50% US whereas Vanguard are around 30% US. Personally, I don't think over 50% US is very balanced even if it does reflect market cap.

Not sure where you got this data from?

VLS 100 

Vanguard U.S. Equity Index Fund GBP Acc	19.4%
Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc*	19.3%
Vanguard FTSE U.K. All Share Index Unit Trust GBP Acc	19.2%
Vanguard S&P 500 UCITS ETF (USD) Accumulating	15.3%

*of which ~70% is US

so 19.4 + (19.3*0.7) + 15.3 = 48.1

VLS 60 contains the following

Vanguard FTSE Developed World ex-U.K. Equity Index Fund GBP Acc	19.3%
Vanguard U.S. Equity Index Fund GBP Acc	15.3%

(19.3*0.7) + 15.3 = 28.8 

Again 28.8 = 48% of 60



For HSBC adventurous (80% equity) factsheet is just over 50% US equity. So equity portion would be 63%. 

I just looked at HL's geographical breakdown here which says VLS100 is 31.12% US:

https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/v/vanguard-lifestrategy-100-equity-income

The HL figure is incorrect. Grumio's figures are right.

VLS100 investments as at 30.6.22 included 19.3% in Vanguard US fund; 15.3% in Vanguard S&P 500 fund; and 19.3% in Vanguard Developed World ex UK fund, of which 69.5% was US investments, i.e. 13.4% of VLS100; giving a total proportion of VLS100 invested in US equities of 48.1%.

The HL page you refer to also says that 16.7% of VLS100 investments are in Ireland, which is laughable. Investments in Ireland are found in two VLS100 components. They are Vanguard Developed World ex UK at 0.1% of a 19.3% investment, and Vanguard developed Europe ex UK at 0.4% of a 7% investment; giving a total proportion of VLS100 invested in Ireland of 0.0473%, not the 16.7% suggested by HL

LifeStrategy® 100% Equity Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed World ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)
FTSE Developed Europe ex-U.K. Equity Index Fund - Accumulation (vanguardinvestor.co.uk)

Well whatever the exact amounts are, my point was that VLS100 is significantly less US, even on your figures (48% vs 63%), and significantly more UK than HSBC, and that's almost certainly the reason for its underperformance. Plus as mentioned above the strengthening of the USD.

It hasn't underperformed. It is a different fund doing a different job. The two series of funds have different remits. One follows fixed compositions of equities and bonds, with a home bias the the UK; and the other changes composition in the hope of targeting and maintaining a specific level of risk.

The series of funds will never mirror each other in terms of performance and no one who understands what they are designed to do and how they are constructed would expect them to. Your suggestion of underperformance is like suggesting an apple underperforms a pear. 

Read the post I replied to. It wasn't my suggestion, it was Albermarle's who said "... but the VLS funds have been underperforming one of their main competitor in the UK...".
We're actually making the same point, ie they are different funds with different constituents and different remits so a comparison of performance is indeed like comparing an apple and pear. I quite agree. That was my point.
But well done on pointing out the exact apply'ness and pear'ness of the funds I suggest you inform HL.

You were replying to my post, not Albermarle's when you mentioned the "underperformance" of VLS. Everyone can see that.

Well we're both technically correct. A pear can underperform an apple, for instance a pear underperfoms an apple at "roundness". Things can be compared even if they are constituted differently and have different objectives you know.

I was just pointing out that they are different. And you agreed, although you want to make a big deal about the exact extent of the difference. Go for it, if you think it makes you look smart.

And if you want HL to be informed of their shortcomings then I suggest you do it it. After all, it's your idea not mine, and it was you who was using a link to their site to support your posting of misinformation on here as to the composition of VLS100. 😉

CBA. You say they're wrong, you tell them. I've not checked your figures, because I really don't care, I was just pointing out the funds are different. You don't dispute that, you just want to make a big deal about HL being wrong. So tell them, not me.

Have a lovely evening and don't let the heat get to you.

Oh right. You care enough about the composition of VLS100 to post misinformation twice, but when it is pointed out that you are wrong you "really don't care".

I'm not convinced and no one else will be either.

I posted links to Vanguard's site where they give their figures for the composition of their funds on 30.6.2022, and they show your postings were wrong. You're the one who relied on HL for your information, not me. And telling them they're wrong is your idea not mine. If you "CBA" then why were you bothered enough to post the suggestion?

That's not very convincing either.

Probably time for you to stop digging.

Oh dear, are really you obsessed about this aren't you? I said VLS was around 30%, someone asked where I got the figures from, so I posted a link to the HL website where I got the info from. Perhaps one of the biggest UK investment platforms are right about the exact percentage, or perhaps a couple of random MSE posters are right, but I don't care, because the point I was making is correct and not in dispute, ie that the HSBC funds have a higher US and lower UK weighting and that is the likely explaination for the performance difference.

Anyway, believe what you want, we're through with this pointless little sidetrack. Ta ta.

No, I'm not obsessed. Now you're resorting to personal attack because you have run out of any other road.

And you say you "don't care", but you keep on posting don't you? 

No, "one of the biggest UK investment platforms" is not right, either in it's statement of the proportion of VLS100 in US equities, nor in its saying that 16.7% is invested in Ireland, which is just bizarre.

And it isn't "a couple of random MSE posters" who are saying they're wrong and you're wrong, but fund portfolio listings of the contents of Vanguard funds as at 30.6.2022 posted on Vanguard's own website, to which I provided links.

Feel free to carry on digging though.

zagfles

Cus said:

I think @zagfles has inferred an incorrect view in my opinion. The difference in performance is very likely to be linked to a UK bias for vanguard, that has led to a reduced performance. The HSBC fund performs an appropriate balance based on market caps so is not US biased, but actually correctly weighted.

Well, yes, however you want to describe it, VLS is more UK and less US than HSBC, and that's the reason for the performance difference. I think we're all agreeing on this substantive point. The minutiae seem very important to some people, but on the main point we all agree.

IanManc

zagfles said:

Cus said:

I think @zagfles has inferred an incorrect view in my opinion. The difference in performance is very likely to be linked to a UK bias for vanguard, that has led to a reduced performance. The HSBC fund performs an appropriate balance based on market caps so is not US biased, but actually correctly weighted.

Well, yes, however you want to describe it, VLS is more UK and less US than HSBC, and that's the reason for the performance difference. I think we're all agreeing on this substantive point. The minutiae seem very important to some people, but on the main point we all agree.

"Minutiae" which you yourself considered so important that you posted misinformation about it twice, and then doubled down on it repeatedly when provided with evidence that you were wrong.

Honestly, this is just funny now. 

Linton

zagfles said:

Cus said:

I think @zagfles has inferred an incorrect view in my opinion. The difference in performance is very likely to be linked to a UK bias for vanguard, that has led to a reduced performance. The HSBC fund performs an appropriate balance based on market caps so is not US biased, but actually correctly weighted.

Well, yes, however you want to describe it, VLS is more UK and less US than HSBC, and that's the reason for the performance difference. I think we're all agreeing on this substantive point. The minutiae seem very important to some people, but on the main point we all agree.

Actually I dont agree that the difference in %UK is the main reason for the performance difference - if it was the performance difference would be larger.  It is part of the picture but on the other hand you also need to consider that HSBC GS Balanced has a lower % equity than VLS60 which in the growth era would have led to lower performance and reduced volatility.

Other factors include HSBC GS Balanced currently having a significantly lower Gilt allocation and a greater % in US bonds. I am investigating but not yet sure whether HSBC's risk targeting strategy includes adjusting the bond investments according to market conditions.

It will be interesting to see how the two funds compare now (or perhaps if)  Growth investments are less dominant.

zagfles

dunstonh said:

So would you recommend the HSBC fund for 2023/24 as oppose to Vanguard 

You don't know which of the multi-asset funds with underlying passives will be best in any one tax year.  In any single year, one could be better than the other.   However, HSBC GS is cheaper and has outperformed VLS in more discrete periods than the other way around.  On paper, HSBC is probably the better technical option (cheaper, unfettered and risk targetted vs more expensive, fettered and not risk targetted), but it is a bit like picking between two Granny Smith apples.

More like an apple and a pear, as mentioned above (ignore the hysteria). The funds have different makeups, so they will perform differently, personally I think 63% US isn't very "balanced" even if does correctly reflect market cap, and VLS has a "home bias" which they have logical reasons for (they did have an article on this but can't find it).

Be wary of chasing past performance, one of the biggest selling funds last year was BG American after it returned 100%+ over a year, then went down about 55% since see https://forums.moneysavingexpert.com/discussion/comment/79282564#Comment_79282564. Obviously the risk is different here, but the principle is the same.

This article is interesting https://www.ftadviser.com/investments/2021/10/04/westaway-says-lifestrategy-home-bias-is-being-dialled-down/