UK Tracking ETFs at InvestEngine

boingy

I'm looking to transfer my Virgin S&S ISA to another platform. I'm favouring InvestEngine, purely for the low costs, but I can't decide which ETF to use. The Virgin ISA tracks the FTSE All Share and I'd like to stay with a UK tracker for this ISA, because I already have other investments in global funds.

The cheapest I've found is L&G UK Equity:
https://investengine.com/etfs/legal-general-lg/lguk/

I'm interested in views on this fund and on any suggestions for other ETFs in the InvestEngine list:
https://investengine.com/etfs/all/

Qyburn

Just out of interest, does II only offer ETFs? I'm vaguely looking at platforms to maybe transfer a small ISA currently with HL, and another really ancient one elsewhere. 

DavidT67

boingy said:

I'm looking to transfer my Virgin S&S ISA to another platform. I'm favouring InvestEngine, purely for the low costs, but I can't decide which ETF to use. The Virgin ISA tracks the FTSE All Share and I'd like to stay with a UK tracker for this ISA, because I already have other investments in global funds.

The cheapest I've found is L&G UK Equity:
https://investengine.com/etfs/legal-general-lg/lguk/

I'm interested in views on this fund and on any suggestions for other ETFs in the InvestEngine list:
https://investengine.com/etfs/all/

LGUK tracks the Solactive Core United Kingdom Large & Mid Cap index, so has a mild ESG / SRI slant.  Combine with the other four regional L&G ESG ETFs and you can replicate LGGG, their Global ESG ETF, but for a slightly lower charge.

JohnWinder

I think one would have a look at the index it tracks.
Firstly, the index company started a decade or so ago. How long will it last? It has not countless, but a LOT of indexes. How many will still be going in 20 years time? Perhaps it doesn’t matter if you have to change fund again if the index disappeared.

That index has 94 stocks. Is the FTSE100 and 250 comparable as they cover large and mid-cap as Solactive does? If so, someone’s picking 94 stocks out of 350, and you’re hoping the 94 will do better than a broader index; it goes against the ‘be diversified’ mantra somewhat.

Is the index ‘good’ for a fund to track? Such as: is the turnover of stocks low (to reduce transaction costs); does it encourage ‘front running’ by other investors; how does its performance compared with well established indexes that the big players (Blackrock, Vanguard, State Street) use?
If those shortcomings were real and not just imagined by me, how much difference would it make to your fortunes? Probably not much, but it’s worth thinking about the index if you choose an index fund.

EthicsGradient

Qyburn said:

Just out of interest, does II only offer ETFs? I'm vaguely looking at platforms to maybe transfer a small ISA currently with HL, and another really ancient one elsewhere. 

Do you mean "II" (Interactive Investor) or "IE" (InvestEngine)? Interactive Investor also offer stocks, OEICs and some gilts and corporate bonds.

JohnWinder

That fund size is £M85. People who know things would say that's far too small, and at risk of closing.

The management charge is 0.05%/year. Does that mean they raising £42500/year in fees, to pay 25 managers? Maybe it's a loss leader to get folk through the door.

Notepad_Phil

JohnWinder said:

That fund size is £M85. People who know things would say that's far too small, and at risk of closing.

The management charge is 0.05%/year. Does that mean they raising £42500/year in fees, to pay 25 managers? Maybe it's a loss leaders to get folk through the door.

A good point about the small size but I doubt that the mention in their documentation of 25 fund managers is just for this specific ETF but rather is across their full index management team for all of their index funds. e.g. they've got £6 billion in their UK index fund and would assume that this ETF piggy backs off the team running that fund, so the small size might not be such an issue for L&G.

Qyburn

EthicsGradient said:

Qyburn said:

Just out of interest, does II only offer ETFs? I'm vaguely looking at platforms to maybe transfer a small ISA currently with HL, and another really ancient one elsewhere. 

Do you mean "II" (Interactive Investor) or "IE" (InvestEngine)? Interactive Investor also offer stocks, OEICs and some gilts and corporate bonds.

Yes sorry I meant Invest Engine, the subject of this discussion.

boingy

Qyburn said:

Just out of interest, does IE only offer ETFs? I'm vaguely looking at platforms to maybe transfer a small ISA currently with HL, and another really ancient one elsewhere. 

As far as I know, yes.

boingy

Thanks all. I'm looking to replace the Virgin ISA with a like-for-like fund at a cheaper rate. I'm attracted to InvestEngine because there are no fees other than a very small TER. This wouldn't be a trading account. The ISA funds will get invested and left alone pretty much forever, hence the ongoing charges need to be as low as possible. I'm open to a different platform if it will save me money.

My problem is finding the right ETF. It needs to be a UK index tracker of some sort. I have plenty of other investments at different risk levels and covering the rest of the world. As usual, there is a bewildering choice of funds....

DavidT67

Focus on which indices you wish to track, then find the lowest cost fund for each index.

So for UK, do you want FTSE100, FTSE250 or FTSE All-Cap ?  i.e. Large, Medium and Small companies.

Easy enough to filter InvestEngine list by the above, or use JustETF for more granular selection filtering.