Is it worth rebalancing my portfolio?

_pete_

I have a SIPP made up of two funds.

28% is in HSBC Global Strategy Balanced C Acc
72% is in Vanguard LifeStrategy 60% Equity A Acc

Ideally I'd like my portfolio to be split equally between the two funds.

How an I calculate how much it would cost me to rebalance so that it's 50/50?

Thank you

dunstonh

Both funds are very similar.  HSBC is closer to market cap for the equities element and VLS has home bias.

Most people would have 100% in one or the other but if you want a bit of both then its fine but the ratio doesn't really matter as its up to you how much home bias you want.

Hoenir

Add the value of the two funds together  Then divide by 2.

Deduct this figure fron the value of the VLS60 fund. Whatever the difference is, sell units to this value and reinvest the proceeds into the HSBC fund. 

_pete_

Thanks for the comments.

I don't think I've phrased my question clearly.   I'm trying to work out what the actual cost of selling some of the VLS60 and buying some of the HSBC Global Balanced will be.   My understanding is that you lose money when you buy and sell funds (in addition to the dealing charge, which is trivial).   I want to see if it's worth doing.

EthicsGradient

And always double-check your figures before proceeding. For instance, 28% + 92% = 120%. So we know one, or both, of the 28% and 92% figures are wrong.

Hoenir

_pete_ said:

Thanks for the comments.

I don't think I've phrased my question clearly.   I'm trying to work out what the actual cost of selling some of the VLS60 and buying some of the HSBC Global Balanced will be.   My understanding is that you lose money when you buy and sell funds (in addition to the dealing charge, which is trivial).   I want to see if it's worth doing.

Then you'll need to look at historic prices to ascertain what the spread is, if any. 

_pete_

EthicsGradient said:

And always double-check your figures before proceeding. For instance, 28% + 92% = 120%. So we know one, or both, of the 28% and 92% figures are wrong.

Cheers.  I've corrected my original post.

ColdIron

_pete_ said:

28% is in HSBC Global Strategy Balanced C Acc
62% is in Vanguard LifeStrategy 60% Equity A Acc

I make  28 + 62 = 90

I'd start with the basics

_pete_

ColdIron said:

_pete_ said:

28% is in HSBC Global Strategy Balanced C Acc
62% is in Vanguard LifeStrategy 60% Equity A Acc

I make  28 + 62 = 90

I'd start with the basics

Oh God.  I'll edit my post again.

InvesterJones

_pete_ said:

I have a SIPP made up of two funds.

28% is in HSBC Global Strategy Balanced C Acc
72% is in Vanguard LifeStrategy 60% Equity A Acc

Ideally I'd like my portfolio to be split equally between the two funds.

How an I calculate how much it would cost me to rebalance so that it's 50/50?

Thank you

You can't know the prices in advance so you'll have to be OK with being a little out. But if you transfer 30.5% of the value of the VLS to the HSBC you'll end up close. Then cost is whatever your platform charges for a switch.

(Working: (72-28)/2 gives the 22 percentage points transfer required. Converting that to percentage of VLS is just a case of dividing that 22 by 0.72)

dunstonh

 I'm trying to work out what the actual cost of selling some of the VLS60 and buying some of the HSBC Global Balanced will be

With most platforms it would be zero cost as its unusual for there to be costs in buying or selling UT/OEICs.   However, there are some niche players that do.

 My understanding is that you lose money when you buy and sell funds (in addition to the dealing charge, which is trivial). 

You need to tell us what the dealing costs are if you are using one of those niche players.