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Low cost index trackers that will save you money

This is our latest update on the best low cost index trackers now on the market. It replaces any previous versions. Note: We don’t include platform exclusive funds – they’re generally not a good deal overall. 

Low costs – that’s the name of the game for passive investors. Performance is unpredictable and elusive, but costs are nailed on. They nibble away at your returns like a satanic mouse – harmless enough at first, until you realise all your cheese has gone.

As Morningstar puts it:

If there’s anything in the whole world of mutual funds that you can take to the bank, it’s that expense ratios help you make a better decision.

That’s why I try to leave no penny un-pinched when searching for cheap funds.

I presented my then top, low cost picks in the lazy portfolio post. But it’s nice to have a choice.

So, for your ascetic delight and entertainment, I bring you: Britain’s cheapest index trackers and their next best alternatives.

High cost funds gobble returns

As an avowed passive investor, I’m concentrating purely on index funds and Exchange Traded Funds (ETFs). That’s because they are the simplest cut-price vehicles available.

I’m also sticking to the broad market categories recommended in the lazy portfolios. They offer ample diversification at a low cost. I’m not into kinky stuff like short Brazilians.

My picks are based purely on price as measured by the Ongoing Charge Figure (OCF), and any other upfront fund fees that may apply. There are other factors to consider when buying a fund (like tracking error, liquidity, and size) so it’s always worth reading any documentation to make sure it fits your bill.

Identifying tickers or ISIN codes are given in brackets. If there are any other wrinkles worth mentioning, I’ll throw them in along the way.

Finally, if you’re looking for the cheapest place to buy and hold these funds then take a butcher’s at our online broker comparison table.

The UK’s best low cost index trackers

Right, let’s grab some bargains!

Note: Anything not labelled ETF or ETC will be an index fund. Codes are given for accumulation funds variants where available.

Domestic large cap equity

Cheapest

  • iShares UK Equity Index Fund D (GB00B7C44X99) OCF 0.06%

Next best

  • HSBC FTSE All Share Index C (GB00B80QFX11) OCF 0.07%
  • Vanguard FTSE UK All Share Index Trust (GB00B3X7QG63) OCF 0.08%
  • Fidelity Index UK Fund W (GB00BLT1YM08) OCF 0.08%

Domestic mid cap equity

Cheapest

  • Vanguard FTSE 250 ETF (VMID) OCF 0.1%

Next best

  • L&G UK MID Cap Index Fund I (GB00BQ1JYX87) OCF 0.14%
  • db X-trackers FTSE 250 ETF (LU0292097317) OCF 0.15%

Domestic small cap equity

There are no good tracker options in the UK small cap asset class for DIY investors. Of the funds listed below, the iShares ETF is more of an expensive FTSE 250 tracker, and the rest are active funds.

Cheapest

  • Schroder Institutional UK Smaller Companies (GB0007893984) OCF 0.52%

Next best

  • Baillie Gifford British Smaller Companies B (GB0005931356) OCF 0.67%

Domestic value equity

Most UK tracker options are only an approximation of this asset class:

Cheapest

  • 7IM UK Equity Value Fund C (GB00BWBSHV64) OCF 0.35%

Next best

  • Vanguard FTSE UK Equity Income Index (GB00B59G4H82) OCF 0.22%
  • WisdomTree UK Equity Income ETF (WUKD) OCF 0.29%
  • PowerShares FTSE UK High Dividend Low Volatility ETF (UKHD) OCF 0.39%

Note: The 7IM fund takes the top spot because it’s the one UK tracker that explicitly follows a value methodology. The remainder are high-yielding funds, not true value funds. A high-yielding fund is a distant cousin of value and not always a pretty one at that. Pure value funds are available in the UK through Dimensional Fund Advisors, but only via an associated IFA who will charge you fees.

World equity

Cheapest

  • L&G Global 100 Index Trust I (GB00B0CNH056) OCF 0.14%

Next best

  • Fidelity Index World Fund I (GB00B7LWFW05) OCF 0.15%
  • HSBC MSCI World ETF (HMWO) OCF 0.15%
  • HSBC FTSE All-World Index Fund C (GB00BMJJJG09) OCF 0.21%

The HSBC index fund contains an emerging market component. The rest cover the developed world only.

World value equity

Cheapest

  • Vanguard Global Value Factor ETF (VVAL) OCF 0.22%

Next best

  • db x-trackers MSCI World Value Factor ETF (XDEV) OCF 0.25%
  • iShares Edge MSCI World Value Factor ETF (IWVL) OCF 0.3%
  • Lyxor SG Global Value Beta ETF (SGVL) OCF 0.4%

Note: Vanguard’s Global Value Factor is classified as an active fund because it does not follow an index. It does follow a low-cost, rules based approach however, which is why it makes the list. All factor based investing is effectively straying into active management territory – you hope that a subset of the market can outperform – the key is to choose products underpinned by sound financial theory, a verifiable set of rules and a commitment to low costs.

World small cap equity

Cheapest

  • Vanguard Global Small-Cap Index Fund (VIGSCA) OCF 0.38%

Next best

  • SPDR MSCI World Small Cap ETF (WOSC) OCF 0.45%

International ex-UK equity

Cheapest

  • L&G International Index Trust I (GB00B2Q6HW61) OCF 0.13%

Next best

  • Vanguard FTSE Dev World ex-UK Equity Index (GB00B59G4Q73) OCF 0.15%
  • Aviva Investors International Index Tracking SC2 (GB00B2NRNX53) OCF 0.31%
  • db x-trackers FTSE All-World ex-UK (XWXU) OCF 0.4%

You can also pick ‘n’ mix using individual US, Europe ex-UK, Japan, and Pacific ex-Japan trackers.

Emerging markets equity

Cheapest

  • db X-trackers MSCI Emerging Markets Index ETF (XMME) OCF 0.20%
  • Amundi ETF MSCI Emerging Markets ETF (AUEM) OCF 0.20%

Domiciled in France – subject to withholding tax.

Next best

  • Fidelity Index Emerging Markets Fund W (GB00BLT1YT76) OCF 0.23%
  • iShares Emerging Markets Equity Index Fund D (GB00B84DY642) OCF 0.24%

Socially responsible investing

Cheapest

  • UBS (Irl) ETF – MSCI United Kingdom IMI Socially Responsible ETF (UKSR) OCF 0.28%

Next best

  • L&G Ethical Trust I (GB00B0CNH940) OCF 0.31%
  • Vanguard SRI Global Stock Fund (IE00B76VTN11) OCF 0.35%
  • iShares Sustainable MSCI Emerging Markets SRI ETF (SUSM) OCF 0.35%

Multi-factor

Cheapest

  • Amundi ETF Global Equity Multi Smart Allocation Scientific Beta ETF (SMRU) OCF 0.4%

Next best

  • Lyxor JP Morgan Multi-Factor World Index ETF (LYXW) OCF 0.4%
  • Source Goldman Sachs Equity Factor Index World UCITS ETF (EFIW) OCF 0.65%

Property – UK

Cheapest

  • iShares FTSE EPRA/NAREIT UK Property ETF (IUKP) OCF 0.4%
  • iShares MSCI Target UK Real Estate ETF (UKRE) OCF 0.4%

Next best

  • No index fund alternative

Property – global

Cheapest

  • L&G Global Real Estate Dividend Index I (GB00BYW7CN38) OCF 0.2

Next best

  • iShares Global Property Securities Equity Index Fund D (GB00B5BFJG71) OCF 0.22
  • Amundi ETF FTSE EPRA/NAREIT Global ETF (EPRA) OCF 0.24%
  • SPDR Dow Jones Global Real Estate ETF (GBRE) OCF 0.4%

Includes emerging markets exposure.

All-commodities

Cheapest

  • Source Bloomberg Commodity ETF (CMOP) OCF 0.19%

Next best

  • ETFS Longer Dated All Commodities Go ETF (CMFP) OCF 0.3%
  • Lyxor Commodities Thomson Reuters/CoreCommodity CRB TR ETF (CRBL) OCF 0.35%

Gold

Cheapest

  • iShares Physical Gold ETC (SGLN) OCF 0.25%

Next best

  • Source Physical Gold ETC (SGLD) OCF 0.29%
  • db Physical Gold ETC (XGLD) OCF 0.29%

Gold trackers are Exchange Traded Commodities (ETCs).

UK Government bonds – intermediate duration

Cheapest

  • Lyxor FTSE Actuaries UK Gilts (GILS) OCF 0.07

Next best

  • Vanguard UK Government Bond ETF (VGOV) OCF 0.12%
  • SPDR Barclays Capital UK Gilt ETF (IE00B3W74078) OCF 0.15%
  • Vanguard UK Gov Bond Index (IE00B1S75374) OCF 0.15%
  • L&G All Stocks Gilt Index Trust I (GB00B8344798) OCF 0.15%

UK Government bonds – long

Cheapest

  • SPDR Barclays Capital 15+ Year Gilt ETF (IE00B6YX5L24) OCF 0.15
  • Vanguard UK Long-Duration Gilt Index fund (GB00B4M89245) OCF 0.15%

UK Government bonds – short

Cheapest

  • Lyxor FTSE Actuaries UK Gilts 0-5Y ETF (GIL5) OCF 0.07

Next best

  • SPDR Barclays Capital 1-5 Year Gilt ETF (IE00B6YX5K17) OCF 0.15
  • iShares UK Gilts 0-5 ETF (IGLS) OCF 0.2%

UK Government bonds – index-linked

Cheapest

  • Lyxor FTSE Actuaries UK Gilts Inflation-Linked (GILI) OCF 0.07

Next best

  • Vanguard UK Inflation Linked Gilt Index fund (GB00B45Q9038) OCF 0.15%
  • L&G All Stocks Index Linked Gilt Index Trust I (GB00B84QXT94)  OCF 0.15%
  • iShares Index Linked Gilt Index Fund D (GB00B83RVT96) OCF 0.16%

International government bonds

Cheapest

  • iShares Overseas Government Bond Index Fund D (GB00B849C803) OCF 0.17%

Next best

  • iShares Global Government Bond ETF (IGLO) OCF 0.2%
  • iShares Global AAA-AA Government Bond ETF (SAAA) OCF 0.2%
  • db X-trackers Global Government Bond ETF (XG7S) OCF 0.2% 

International bonds hedged to £ (government and corporate)

Cheapest

  • Vanguard Global Bond Index (IE00B50W2R13) OCF 0.15% 

Hedged back to Sterling.

Next best

  • Vanguard Global Short Term Bond Index (IE00BH65QG55) OCF 0.15%

Hedged back to Sterling.

  • db X-trackers Global Government Bond ETF (XGSG) OCF 0.25%

Hedged back to Sterling.

International inflation-linked bonds hedged to £

Cheapest

  • db X-trackers Global Inflation Linked ETF (XGIG) OCF 0.25% 

Hedged back to Sterling.

Next best

  • L&G Global Inflation Linked Bond Index I (GB00BBHXNN27) OCF 0.27%

Hedged back to Sterling.

UK Corporate bonds

Cheapest

  • L&G Sterling Corporate Bond Index Fund I (GB00B4M01C47) OCF 0.14%

Next best

  • L&G Short Dated Sterling Corporate Bond Index Fund I (GB00BKGR3H21) OCF 0.14%
  • Vanguard UK Investment Grade Bond Index (IE00B1S74Q32) OCF 0.15%
  • iShares £ Ultrashort Bond ETF (ERNS) OCF 0.09%

Note: The iShares ETF doesn’t take top spot because it’s a specialist ultrashort bond tracker with a duration of a third of a year. Not for general use but could be handy for deaccumulators.

Concluding thoughts on low cost trackers

If you’re new to passive investing then it might seem like you now have a lot of decisions to make after reading that lot.

This piece on designing your own asset allocation will help you construct your own portfolio. If you want a quick short-cut then you can do a lot worse than picking a fund-of-funds instant portfolio solution.

We only update this post periodically. Please bear in mind the quoted OCFs may date as fund groups fight their turf wars by undercutting each other (hurrah). But this list should still prove an excellent starting point for your research.

And if anyone comes across any better index tracker options I’d love to hear about them in the comments below.

Take it steady,

The Accumulator

Note: Some comments below may refer to an older collection of low cost index trackers. Scroll down for the latest thoughts.

Filed under: Passive investing

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{ 565 comments… add one and remember nothing here is personal advice }
  • 499 Steve June 26, 2016, 3:19 pm

    Thanks @TA, good to know this wasn’t just a failure in my search abilities. The trouble is that in the current market conditions I’m reluctant to accept the forward pricing that goes with buying index funds (normally I’m fine with it). I think I need to go look into just how onerous the tax return implications of a capitalising ETF would be; maybe it’s not as bad as I fear.

  • 500 Max July 4, 2016, 11:18 am

    Does anyone perhaps know of any ex Europe funds?

  • 501 Darren July 6, 2016, 6:49 am

    Thanks for all the info and comments.

    I don’t see any mention of the Legal & General UK Index Tracker which seems cheap at 0.10% (0.06% via HL).

    How does it compare with the Vanguard FTSE UK All Share Index which charges 0.08% with 0.2% initial cost?

  • 502 boardgamer July 13, 2016, 9:00 pm

    I stumbled across this article
    http://www.finalytiq.co.uk/7im-crashes-dimensionals-party/
    which lists a few useful looking value funds, allegedly comparable to Dimensional offerings. They seem to be tradable at HL (and probably others). Fees are somewhat lower than DFA, but there isn’t nearly so much historical performance data as with DFA funds.

    I hold a fair chunk of DFA funds myself, but they’re a bit of a faff as they’re via an IFA (on an execution-only basis), so I’d welcome a decent “normal” alternative. No Global value offering, although I guess you can construct a near-enough version from the US/Europe/UK/EM products.

  • 503 Mr optimistic July 13, 2016, 10:00 pm

    Regarding fund costs, I also have had difficulty establishing whether a fund of funds fund (did I really write that?) TER captures sub fund costs, wish they would say in the factsheet but usually they don’t. I also use something like HL to double check charges. This saved my bacon when a high income fund claimed a management fee of 0.65% in its fact sheet but HL reckoned 2.04%. HL were right once the annual report was examined. Fact sheets need care!

  • 504 @algernond July 28, 2016, 8:28 pm

    Hi. I noticed for my workplace pension, I can get the institutional charge for the Vanguard funds (~ 1/3 lower OCF).

    If I want to transfer to my SIPP in the future, but can only get the normal OCF, does anyone know if it would be in specie or have to be cash, because of the institutional vs standard OCF?

  • 505 Jon Williams August 11, 2016, 4:44 pm

    With 10 year gilt yields at 0.582% what should I be using as the water to my whisky on a passive portfolio?
    Should I still keep drip feeding gilt index funds – or maybe international bonds hedged back to GBP or even investment grade corporate bond funds?

  • 506 The Accumulator August 11, 2016, 8:41 pm

    Hi Jon, international bonds hedged back to £ are a plausible alternative. I’ve just taken a look at Vanguard’s global bond fund:
    https://www.vanguard.co.uk/uk/portal/loadPDF?country=uk&docId=2036

    Yield to maturity is 1.2% vs 1% from their UK gov bond fund.

    Average credit quality is the same although the global bond fund is spread over a wider range: from near 40% AAA down to 17% BBB.

    Big difference is the duration. The global fund is near 7 years vs 12 for gilt fund. So, the global fund should theoretically be less volatile although currency risk could add a bit more – the hedging is unlikely to be perfect.

    Fund costs are the same. I’d personally steer clear of corporate bond funds. They don’t offer the same downside protection in a recession that gov bonds often give.

  • 507 DonF September 11, 2016, 11:09 am

    @TA: Why don’t you list IWFS under World small cap equity?

  • 508 The Accumulator September 11, 2016, 10:18 pm

    Hi Don F, it’s not small cap. iShares currently say it invests in smaller cap companies but that doesn’t actually mean small. It’s a mid-cap to large cap mix. Take a look at the breakdown here:
    http://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P00014E8B&tab=3

    vs Vanguard Global Small cap:
    http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F000005OPT&tab=3

  • 509 Redcactus November 21, 2016, 4:12 pm

    @TA Have you seen/have a view on the new FTSE All Cap Global Index fund introduced by Vanguard in the UK ?

    https://www.vanguard.co.uk/uk/portal/detail/mf/overview?portId=8617&assetCode=EQUITY##overview.

    Your site has converted me to Lars Kroijer’s philosophy that by understanding you don’t have an edge, one should therefore “own shares in all the market’s stocks, weighted according to their fraction of the overall value of the market”.

    I’m therefore of the view that dripfeeding into this fund each month rather than the Lifestrategy 100 I currently pay into, would better accord with Lars’s approach as it includes small cap companies across the world as well as avoiding the UK overweighting inherent within LS100.

    0.24% OCF and I am not sure that it is yet available on the major platforms but is this one to add to your list for the benefit of purists?

  • 510 NOBUNAGA December 1, 2016, 11:43 am

    TA Lyxor have a new share class for index linked Gilts, GILI LN which although their office is in Paris the fund is domiciled in Luxembourg, so I assume this gets around the French withholding tax or am I missing something. It is a very new etf (10.11.16) is it wise to invest in something so young it tracks the same FTSE index as my index fund but far cheaper.

  • 511 NOBUNAGA December 1, 2016, 2:04 pm

    Since posting my previous comment I’ve read a post by algernond that GILI has a TER of 0.22 not 0.07 as I thought. I looked at the KID, Factsheet, Prospectus and Web site but still come up with 0.07 can someone clarify this please.

  • 512 Paul Harsley January 3, 2017, 8:35 pm

    You have pointed out in other articles that the Fidelity Index World I Acc fund is not Total world as it doesn’t include emerging markets. In order to include emerging markets alongside this fund, which emerging markets fund would you highlight? I would like a simple passive index tracker portfolio using only funds that covers all world and emerging markets.

    The Fidelity world mentioned above seems to perform really well but I would like an emerging markets component without a UK bias.

    I am also struggling to work out which funds i can hold with different sipp brokers. It’s very confusing! They all offer different “class” funds and it’s starting to confuse me. How do I know whether I can hold specific funds within a specific sipp operator without signing up?

    I would like to implement literally a 1/2 fund passive index tracker, fund it with around £300 and simply let it grow. Therefore I do not need big fancy platforms but they are making the charges and fund availability so confusing I can’t work out which is cheapest. Even using your table it simply isn’t as easy as you make it seem. If I’m funding it monthly with simply 1/2 funds in the portfolio do I pay a fund dealing fee (Youinvest@£1.50) every month for each fund?

    Sorry there’s lots of questions I’ve been reading everything about this and still feel really confused! Please help!

  • 513 Jonathan January 4, 2017, 2:50 pm

    Does anyone know of an alternative to the Vanguard LifeStrategy fund that does a similar thing but on an ETF basis (or even actively within an Investment Trust provided it is low cost). I have my SIPP with HL and am trying to shift it all to shares and ETFs due to their annoying double charging structure. I’ve got rid of most funds/trackers now and replaced with ETFs and Investment Trusts, but I can’t work out how to get rid of the LifeStrategy fund short of buying lots of individual ETFs (and even then, it wouldn’t really replicate, as I would lose the automatic rebalancing).

  • 514 The Accumulator January 8, 2017, 10:13 pm

    Hi Jonathan, try VRWL and combine with a UK gov bond ETF. That’s the closest you will get

  • 515 The Accumulator January 8, 2017, 10:30 pm

    Thanks Redcactus. Looks like it’s 8 – 12% small cap, so theoretically expected returns should be a smidge better. If you google: ftse global all cap index then you can download a pdf which shows the all-cap nudging ahead of the all-world over 5 years. The all-world goes down to mid cap level. It probably won’t make much difference overall but it certainly offers a touch more optimisation.

    Will put it on the list.

  • 516 The Accumulator January 8, 2017, 10:43 pm

    @ Paul – Vanguard’s LifeStrategy 100 is an index fund with a small percentage of emerging markets – around 7%. They’ve also recently released the FTSE Global All Cap Index Fund which is similar.

    If you want a dedicated emerging market fund for a higher allocation then see the section above – Fidelity have a fund as does Blackrock. Vanguard also have an emerging index fund with an OCF of 0.27%.

    Most decent brokers will let you see their fund list without signing up. You’ll need to dig around their site. Often the relevant section will be labelled Research.

    I’m not sure what you mean by 1/2 fund. If you’re starting from scratch and investing £300 a month in a SIPP then take a look at a low cost percentage fee broker like Close Bros, Cavendish or Best Invest. They won’t charge you for trading funds and will be cheaper than Youinvest.

  • 517 BlackSamurai摩天楼 January 11, 2017, 12:13 pm

    thanks for this @Accumulator. This is helping me make my choices, as well as the series you and the Investor on all this 🙂

  • 518 Kayvaan January 15, 2017, 12:58 pm

    There is a cheaper world property fund, unless I’m mistaken.

    Legal & General Global Real Estate Dividend Index I GBP Acc (GB00BYW7CN38) OCF 0.2%

    http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F00000W9M1

    Seems to have almost identical holdings to the blackrock global property securities fund you listed. Has the same benchmark. Anything I’m missing?

  • 519 The Accumulator January 15, 2017, 8:23 pm

    Slightly different benchmark by the looks of things: FTSE EPRA/NAREIT Developed Dividend Plus Index.

    That’s not why it’s not in the list though. It was too new last time we updated.

  • 520 Kayvaan January 16, 2017, 12:10 am

    Ah so it is. Would you recommend it as an adequate alternative to the blackrock fund if a broker doesn’t have the latter?

    Thanks!

  • 521 hyperhypo January 18, 2017, 3:48 pm

    Re. the Blackrock global property tracker Class D (which i hold)…through a clerical error on .y part i’ve inadverently moved from Class D into Class H …which i’m sure wasn’t around when i first gotten use to my new SIPPs s/w…anyway Class H is a tad cheaper at 0.2% but i can’t for the life of me work out what the difference is …someone put me straight please..it don’t want to hold both classes …inclination is to line up here on Class D but i’d like to know of the difference. Thanks ..

  • 522 The Accumulator January 18, 2017, 7:24 pm

    Are you on Hargreaves Lansdown, hyperhypo? If I’m remembering correctly, Class H is a version of the same fund that’s exclusively available on HL at a slight discount. Re: all those share class designations – the difference is the price of the fund.

  • 523 Dan January 19, 2017, 7:29 am

    Vanguard have cut the OCF on their Lifestrategy range from 0.24% to 0.22% as of 18 Jan.
    Every little helps

  • 524 hyperhypo January 19, 2017, 10:26 pm

    @TA…..no my Class H /Class D query ..is with my company Aegon ARC SIPP…i asked the admins and they included a couple of factsheets but weren’t able to be specific over differences ..suggested i check with Blackrock which is fair enough ..i only stumbled over H in error, and it would seem sensible to me to stick with Class D as per S&S.

  • 525 Kayvaan January 20, 2017, 1:31 am

    The Blackroack Global property securities fund class H on Hargreaves Lansdown looks to have a buy sell price of 141.30/148.70. Correct me if I’m wrong but isn’t that an atrocious bid offer spread? Losing around 5% immediately seems like a terrible choice.

    Meanwhile the same fund as a class D from bestinvest for example has a bid offer spread of only 0.17%, with 0.23% OCF.

    Surely a far superior deal?

  • 526 hyperhypo January 20, 2017, 5:14 pm

    @Kayvaan

    Indeed it is and i’ve learned something in the process ….thank you for putting me straight!
    Class D it is.

  • 527 vtk February 22, 2017, 11:53 am

    Hi,

    The ‘HSBC FTSE All-Share Index Fund Institutional Accumulation’ (http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=f0gbr06i7o) has an OCF of 0.03%.

    Does that make it the cheapest on your list or am I reading something wrong?

    Many thanks!

  • 528 The Accumulator February 22, 2017, 8:37 pm

    Hi vtk, Morningstar includes all kinds of weird and wonderful funds which aren’t available to us regular Joes and Josephines. As an institutional fund at that price it’s almost certainly only available to big financial players.

  • 529 vtk February 23, 2017, 12:21 pm

    Hi TA, thanks for your response. I’m a regular Joe invested in this fund (‘HSBC GLOBAL AM UK FTSE ALL SHARE IDX INST ACC’ code MDSAC) via an iWeb ISA…

    https://iwebfunds.webfg.com/index.php?section=sheet&idShareclass=F0GBR06I7O

  • 530 vtk February 24, 2017, 8:18 pm

    @TA – also, I have a question, please – what’s the best, cheapest way of investing in the S&P500 for a UK resident?

  • 531 The Accumulator February 25, 2017, 9:21 pm

    Interesting, vtk. That fund has come up before and some Monevator readers reported being unable to buy into the fund at the time. Are you currently investing in it? When did you first invest? I ask because sometimes funds are available to existing investors but not new ones. Great news though if anyone can buy into it.

    re: S&P 500. Just check out the main players: Vanguard, Blackrock, iShares, SPDR, Fidelity, HSBC

  • 532 cheapo March 30, 2017, 11:49 am

    great article, i was wondering if you could help

    I have a cheap L&G tracker at 0.1%. Should i transfer it to Blackrock at 0.06%?

    Blackrock have a bid offer spread which seems to be 1p (currently 0.44%). That means if you buy on day 1, and sell on day 300, and the price is exactly the same, you will lose 0.44%. it seems therefore you have to hold the Blackrock investment for 11 years for it to be cheaper than the L&G investment

    No article on cheap trackers seems to address this point, which seems odd

  • 533 The Accumulator April 2, 2017, 8:58 pm

    Hi Cheapo – great name btw, made me smile. Personally I wouldn’t bother for an 11 year pay-off. Sometimes it’s better to turn these calculations into actual £ amounts and realise that the difference is £10 a year or whatever. Here’s a piece I wrote on bid-offer spreads: http://monevator.com/bid-offer-spreads-and-etf-costs/

  • 534 cheapo April 5, 2017, 11:55 am

    many thanks Accumulator, keep up the good work! It sounds like a real obsessive about costs / investing new money needs to keep an eye on the bid offer spread. If you were for instance looking to buy a tracker that tracked the FTSE all share index, perhaps you should look at a L&G UK all share tracker at 0.1% (but no bid offer spread) rather than a Blackrock uk equity All share UK tracker at 0.06% (but has a bid offer spread) because the bid offer spread essentially acts as an up front cost of c. 0.44% (obviously this upfront cost will depend on what the bid offer spread is at the time of acquisition).

  • 535 Todd April 9, 2017, 3:59 pm

    Hi Accumlator,

    Newbie here. Read lots of articles on here and hear index funds with someone like Cavendish is a good start since I am new with small funds. Is the Vanguard Lifestrategy fund suitable for a beginner? I just want a suitable fund that is low cost but effective so I can leave alone. Thanks

  • 536 The Accumulator April 9, 2017, 7:36 pm

    Hi Todd,

    The short answer is yes and slightly longer answers can be found here:

    http://monevator.com/vanguard-lifestrategy/

    http://monevator.com/using-vanguard-lifestrategy-funds-life/

    Happy reading!

  • 537 Robbo April 12, 2017, 2:36 pm

    Hi,

    I am currently invested in the Vangaurd LifeStrategy 100%, however I am thinking about about moving to a world equity tracker instead for this years ISA allowance due to the UK home bias of the LS100.

    I noticed this article includes the Vanguard FSTE Developed World instead of the Vanguard FTSE All-World. Is that due to the higher OCF on the VWRL or some other reason? I would like some emerging markets so do you think the VRWL would be a better option?

    Vanguard FTSE Developed World UCITS ETF (VEVE) 0.18%
    Vanguard FTSE All-World UCITS ETF (VWRL) 0.25%

    Thanks!

  • 538 Mick June 29, 2017, 8:29 am

    Should Legal & General International Index Trust I Acc with an OCF of 0.13% be on the list – it’s slightly better ( cheaper/bigger/more diversified) than the Fidelity world fund and with an Emerging Market component too

  • 539 Dan July 2, 2017, 11:21 pm

    It appears that BlackRock tracker funds are currently being rebranded to iShares (see the news article on HL dated 28 Jun). This will bring all of their tracker offerings, whether fund or ETF, under the iShares branding.
    The Global Property Securities Equity Tracker currently has the KIID branded as iShares but the factsheet branded as BlackRock.

  • 540 Fremantle July 11, 2017, 9:55 am

    Be great to see the World Equity category split between developed World and Global (including developing), as per Lars recommendation.

  • 541 Gregory July 11, 2017, 10:07 am

    Vanguard Global Value Factor ETF (VVAL) is active. Some ETFs are not physically based.

  • 542 Adrian July 11, 2017, 12:02 pm

    worth a mention is Source Markets S&P 500 UCITS ETF A (SPXS) which at 0.05% is just about as cheap as it gets

  • 543 ABC123 July 11, 2017, 1:59 pm

    Strange that iShares have a Global Property ETF (IWDP) charging 0.59% whilst offering a similar fund charging 0.22%
    I’m wondering if it’s worth the cost of changing – to the L&G fund perhaps.

  • 544 optimistic July 11, 2017, 7:15 pm

    It’s worth bearing in mind that headline cost is not everything, I looked at a Canadian tracker, iShares appeared the more expensive option by a sizeable margin but when one looks at performance , tracking error over a multi year period the others performed far worse. The article points this out but it’s not worth chasing the odd basis point or two, even with 15 plus basis points apparent advantage it does not necessarily translate into a better result.

  • 545 grey gym sock July 12, 2017, 1:49 am

    i see that L&G UK MID Cap Index Fund tracks the FTSE 250 ex. Investment Trusts Index, not the FTSE 250 Index (which most UK mid-cap trackers follow).

    IMHO, excluding investment trusts is an advantage, because it avoids an extra layer of charging – from the investment trusts themselves. mostly, those ITs are just investing in quoted UK and ex-UK shares, which you can own a piece of more cheaply via tracker funds. though some ITs do also invest a bit in unquoted shares and other stuff you can’t get via trackers.

  • 546 AtlanticSpan July 12, 2017, 9:27 am

    As has been mentioned above by ‘Gregory’ the Vanguard Global Value Factor ETF (VVAL) is an actively managed fund. Would you mind clarifying whether you are moving away from highlighting purely passive products to funds offering the lowest OCF? Many thanks.

  • 547 Chris B July 12, 2017, 9:54 pm

    When looking at costs, UK OEICs and unit trusts pay dividends in GBP. Good. However be aware that just about all ETFs pay dividends in EURO or USD which means your platform converts each payment into GBP at a very high currency spread – typically you will lose at least 1.5% of each dividend in Forex fees. Ouch!

  • 548 FIREin' London July 13, 2017, 7:19 am

    Thanks TA – this is a really useful list – not sure how I haven’t seen it before, but does mean I am going to re-evaluate some of the trackers I have… although I want to make sure not everything is in Vanguard so that my paranoia doesn’t stop me sleeping at night!
    Cheers,
    FiL

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