tracking difference

Aidanmc

Is tracking difference and tracking error same thing?

Is there somewhere i can see the tracking difference on a chart between lets say FTSE Allworld index v an allworld fund /etf?

Linton

trustnet gives tracking errors, at least one anyway:  See https://www.trustnet.com/factsheets/e/g1xc/vanguard-ftse-all-world-ucits-etf-gbp under "Find Managers".

eskbanker

Aidanmc said:

Is tracking difference and tracking error same thing?

There’s a good way of summarising the difference between tracking difference and tracking error. Think of two rally cars going head to head in a race. Car number one is the benchmark car, while car number two is your fund.

To the onlookers observing the race and invested in the two drivers, tracking difference is the equivalent of the time difference captured when the cars cross the finish line.

Tracking error, meanwhile, is the equivalent at examining the race footage back to see how close the two cars were to each other during the race itself. Perhaps there might have been a moment where the fund car handled a hairpin bend particularly badly, and had to recover from aggressive oversteer at the very edge of the track boundary. You get the picture.

https://www.morningstar.co.uk/uk/news/224270/going-off-road-what-exactly-is-tracking-error.aspx