Vanguard Launches Three New Global ETFs

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82110613#Comment_82110613

The ETF may also trade at a bigger premium or discount to Net Asset Value. You can find the premium/discount for ETFs on TradingView. That is based on Vanguard's last reported NAV.

https://www.tradingview.com/symbols/LSE-VALL/

Stones

This caught my interest when I saw it, given that I am currently all in on the FTSE Global All Cap fund, and the possibility to have lower fees without moving to another platform.

However, looking at my portfolio held on Vanguard (Sipp & ISA) of approx. £580k, I calculate my fees for the 2 funds as follows ;

Current fund (VAFTGAG) - £580K @ 0.23% = £1334 annual fee - capped at £375

New ETF (VALL) - £580K @ 0.07% = £406 annual fee - also capped at £375

So am I right that there will be no point for me moving to the ETF on the Vanguard platform, assuming the performance being the same?

And the only reason to move would be live price buying / selling?

PixelPound

https://forums.moneysavingexpert.com/discussion/comment/82110638#Comment_82110638

The initial offering, NAV, was set at $5 for this fund (so roughly £3.66).

Swipe

https://forums.moneysavingexpert.com/discussion/comment/82110664#Comment_82110664

You are confusing fund fees with platform fees. Fund fees are taken directly from your gains and the capped platform fees are an additional separate charge on top. So as you can see, there is a significant difference in fees between the OEIC's £1334 and the ETF's £406.

Stones

https://forums.moneysavingexpert.com/discussion/comment/82110722#Comment_82110722

Thanks, I knew something wasn't quite adding up, what a Doofus! (it's been one of those days). 😏

I got it now, the platform fees for both are 0.15%, which are capped at £375.

So, something to think about then…….

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82110671#Comment_82110671

Vanguard did not set the initial NAV. Vanguard calculated it from the market prices of the underlying shares. This is a US article, but the process will be essentially the same for Vanguard Ireland where the ETF is domiciled:

https://www.investopedia.com/articles/investing/071414/how-calculate-value-etf.asp

GeoffTF

https://forums.moneysavingexpert.com/discussion/comment/82110747#Comment_82110747

Although Vanguard did not set the initial NAV of the fund, it did set the initial size of one share of the ETF to be such that the initial NAV of each share was $5. Vanguard has previously set much larger share sizes, which was not popular with people who wanted to invest a small amount each month.

GeoffTF

A Google search pulled up AJ Bell, so it looks like AJ Bell is listing VALL. The London Stock Exchange is showing zero spread. VALL was trading at a premium of 0.3% when the NAV was reported yesterday, according the TradingView.

The London Stock Exchange On Book turnover was nearly £12 million. Most retail trades will be Off Book. There have been several Off Book trades just under £10K, but nothing larger. Could a £10K limit have been in place somewhere?

MeteredOut

https://forums.moneysavingexpert.com/discussion/comment/82110613#Comment_82110613

And to confirm this liquidity risk, i did a little experiment yesterday. I had the 1.5% cashback from my T212 Debit Card (which i use for foreign spend) set up to go 100% into a pie containg S&P 500 ETF (VUAG) only. This is play money - no more than £100/year.

I rebalanced that pie yesterday to go 50/50 VUAG and the new ETF (VALL). The sell on VUAG happened immediately, but the buy on VALL took around 10-15 minutes to be executed, and was on the upper end of the price range once executed.

I'd not be doing any large purchases without setting a buy limit.

Pat38493

I guess if they are quoting exposure to "over 7000" companies in the press release, that maybe implies that this is the same portfolio as the existing OEIC but with the charges slashed?