Vanguard lowering fees - that's nice

UncleK

Just got an email that Vanguard are lowering the fees on their FTSE All-World ETF from 0.19% to 0.14% - a 26% reduction! Not to be sniffed at - I wonder what drove them to that - presumably the competition and loss of customers?

EthicsGradient

That's down to the same as their Dev World ex UK OIEC, and only 0.02% above their Dev World ETF (unless I've missed price drops for either of them). Splitting between developed and emerging market funds really isn't worth it any more.

InvesterJones

Yet ACWI is still cheaper at 0.12%. When it comes to all world there isn't a huge difference between indexes.

bigsy

There are new FTSE All-World ETFs now available from iShares (FTAW TER 0.12%) and Xtrackers (ALLG TER 0.07%). Currently tiny in terms of fund size compared with VWRP/VWRL but no doubt will grow.

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82076897#Comment_82076897

I have just done some quick spread calculations using the LSE numbers. VWRL 0.03%. FTAW and ALLG 0.3%. The new comers (particularly ALLG) are cheaper, but they do not look very attractive to me. (The volatility of these funds should be the same, so the wider spread is the result of differences in liquidity.) Things could change in either direction, of course. Small differences in percentage costs do not amount to much, unless you have big holdings. You do not want big holdings unless the liquidity is good.

bigsy

I agree with that but these new funds are very much in their infancy vs VWRL, launched only in April/May 2026.

I don't know how widely available they are yet - I see them on my ii account but not in SWSD/IWeb. In time they will grow and no doubt the spread will reduce.

It's good to see more competition as I think the FTSE All-World ETF space only had Vanguard and, latterly, Invesco (FWRG).

granta

I currently hold VEVE rather than VWRL (or equivalent) and a proportionate amount of emerging markets ETF (mainly due to historical reasons of accumulating in VEVE and not being aware of VWRL and more recently due to being aware of fee differences).

My question is whether it's now worth consolidating all holdings into VWRL or just leaving as is? I would look to sell VEVE and immediately buy VWRL to avoid market fluctuations but I'm wondering if there might be any potential losses made from the spread or anything else I've overlooked?

So, stick or twist?

masonic

https://forums.moneysavingexpert.com/discussion/comment/82077019#Comment_82077019

The churn would be unnecessary. There will be some losses from spread, and it might take quite a while to break even from those. Meanwhile, who is to say they won't drop fees on VEVE or VFEM. It doesn't make sense to switch funds for a few basis points per year IMHO. Differences in tracking error could remove that apparent advantage.

There is also the issue of USD dividends and forex costs, but some platforms at least say they are able to receive the dividends in GBP - and you'd be wanting VWRP to sidestep that.

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82077019#Comment_82077019

Do nothing. 90% VEVE + 10% VFEM costs 0.9 * 0.12% + 0.1 * 0.17% = 0.125%. That is still cheaper than 0.14% for VWRL. You are still paying for the convenience of having one fund rather than two. To put that into context, you save £15 per year on an investment of £100K by doing nothing.

granta

Thanks for the helpful responses. That was along the lines I was thinking and want to avoid unnecesssary trades.

But, for any new money being invested, is there any benefit to adding only to VWRL?

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82077382#Comment_82077382

Probably not. As far as we know, VWRL is never going to be the cheaper option. I would not want to add new holdings without good reason. That would just add to my documentation overhead.