Vanguard SSTMMF transaction fees?

Alistair31

On vanguards own platform, £93 in transaction fees to invest £50k? Is this normal or is there a better way?

thanks all

QrizB

Alistair31 said:

On vanguards own platform, £93 in transaction fees to invest £50k? Is this normal or is there a better way?

That's an annual amount.

dunstonh

On vanguards own platform, £93 in transaction fees to invest £50k? Is this normal or is there a better way?

There certainly was a better way but the EU decided that is how it it is to be and firms follow the EU directive.    Most investors complete ignore it as its not a real charge.

Hoenir

Unless your platform is free. You'll incur brokerage charges in acquiring the instruments for your portfolio. This isn't a cash fund per se. Being short term there''ll be constant costs being levied as instruments are superceded. . 

GeoffTF

dunstonh said:

On vanguards own platform, £93 in transaction fees to invest £50k? Is this normal or is there a better way?

There certainly was a better way but the EU decided that is how it it is to be and firms follow the EU directive.    Most investors complete ignore it as its not a real charge.

The EU directive does not specify a single method of calculation for transaction costs. I expect that is the result of lobbying by fund managers. Here are Vanguard's numbers on the web:

https://www.vanguardinvestor.co.uk/content/dam/intl/europe/documents/en/vanguard-full-fund-costs-and-charges.pdf

That says 0.16% rather than 0.19%. I suggest that the OP reports the discrepancy to Vanguard by secure message. What really matters is the return that you are actually getting, and the risk that you are taking to get that return.

wmb194

It's still peanuts.

Qyburn

Hoenir said:

Unless your platform is free. You'll incur brokerage charges in acquiring the instruments for your portfolio. This isn't a cash fund per se. Being short term there''ll be constant costs being levied as instruments are superceded. . 

No dealing charges on Vanguard's platform.

pbcpdeveloper

I have had varying % applied over the last year, 0.15%, 0.14%, 0.15%,  0.17%, 0.16%  and this month a 0.19%

dunstonh

The EU directive does not specify a single method of calculation for transaction costs. I expect that is the result of lobbying by fund managers. 

That is the bit that makes the figure pointless.  Ultimately, the EU had the final say.  They settled on fudge that removed any benefit to the consumer.

Here are Vanguard's numbers on the web:

https://www.vanguardinvestor.co.uk/content/dam/intl/europe/documents/en/vanguard-full-fund-costs-and-charges.pdf

That says 0.16% rather than 0.19%. I suggest that the OP reports the discrepancy to Vanguard by secure message. What really matters is the return that you are actually getting, and the risk that you are taking to get that return.

I suspect the  OP is posting ex post figures rather than ex ante figures used in the pdf.

dunstonh

I have had varying % applied over the last year, 0.15%, 0.14%, 0.15%,  0.17%, 0.16%  and this month a 0.19%

Are you referring to ex-post or ex-ante figures?    ex-post will always be different to ex-ante due to another bit of bad decision making in the EU directive where the total charges over a period then use a snapshot date for the value and turn the charges into a percentage of that value.     In reality, your value was not static but the ex-post disclosures assume it was.

pbcpdeveloper

My figures come from the download marked 'Ex Ante costs and charges', the document is titled 'Costs and charges disclosure for <name>'.   It's generated after a transaction.