Been comparing global ETFs to invest long term and I assumed that Vanguard would be the best bet. But after looking in to it I just can’t seem to find any reason why I would go with the Vanguard FTSE all world(VWRP) over L&G Global Equity (LGGG).
The LGGG fund has done slighly better overall, much lower fee at half the cost of the Vanguard fund.
I thought the L&G would have much lower trading volume but it’s higher than Vanguard.
Only issue I can see is VWRP fund size is almost $8billion VS LGGG at $68mil (crazy difference) could affect sell prices in future cancelling out that lower fee potentially?
Maybe the huge red flag is the last one but would be good to hear some thoughts?
Hi, they are not tracking the same index though - VWRP tracks FTSE and LGGG tracks Solactive. Also, LGGG only has roughly one third of the holdings VWRP has according to Justetf - so VWRP seems to be more diversified.
However, the smaller number of holdings is explained by the fact that Solactive also has a list of exclusions which limit which companies make up the index - this would have a direct effect on how much it costs to run the ETF, methinks.
That’s great thanks for the info, that’s exactly the sort of response I was hoping for because I prefer to stick with Vanguard funds. It was kind of a ‘change my mind’ question.
Can I ask a silly question, what site did you get the top 2 screenshots from? It seems to have a nice layout to compare funds compared to what I’m doing now.
edit: Sorry just realised it’s Just ETF which you mentioned in your post!
Also and if I’m not mistaken, LGGG is not completely ‘‘Global’’ as it only includes Developed Markets.
VWRP includes both Developed and Emerging Markets in its tracker.
Well, they say bigger funds are a safer bet.
I wouldn’t go near VWRP either.
FWIW In preference I chose
iShares Edge MSCI World Quality Factor IWFQ
iShares MSCI World IGWD
iShares Edge MSCI World Momentum Factor IWFM
Those are just my choices though.
I use Just ETF (free) to look at comparative risk, fund size and to see graphs of their performance.
Their fee is a little higher, but if you look at their performance they leave ETFs like VWRP in the shade by a very large margin. I’m talking over years here.
Out of 6 ETF’s - only 2 track the same index - Invesco and Vanguard - both in yellow.
Out of 6 ETF’s - only 3 track both Developed Markets and Emerging Market - all 3 in orange.
But… that’s what the ability to set up multiple portfolios within the same ISA comes in handy. Set up 6 portfolios, one for each ETF, put £100 into each portfolio and then just let it “run” and see what happens.
Maybe add the same amount of money on a monthly bases to all portfolios at the same time so that everything stays nicely comparable and watch it a bit more.
I’m not sure why you’d set up multiple portfolios rather than just sticking them all in one - I guess if some of them distribute dividends then
But you’re broadly right Pinch. Past performance is a poor guide to the future - people should make their own assessments about what is likely to do well in the future (emerging vs developed, quality vs momentum vs general) and choose a fund accordingly.
If you set up separate portfolios containing 1 ETF each then each ETF is set to 100% weight. If you put all ETF’s into 1 portfolio then you need to work out separate weights.
If you want to split it equally then each ETF would be 16.6666% of the whole so then you’d need to make decisions about how much weight to give to each ETF. Or you could work out weights in relation to share price in which case you’d have something like this:
All of these ETF’s use Sampling to replicate the index they track. However, they won’t necessarily have the same settings for their sampling routines, methinks. Taking this into account might explain differences.
" The ETF replicates the performance of the underlying index by sampling technique (buying a selection of the most relevant index constituents)."
The important bit is to decide which “things” are important for you when deciding which ETF to buy. I find the screener at JustETf a good starting point for research - https://www.justetf.com/uk/find-etf.html.
I think it is worth having a go (or 2 or 3 ) with the filters provided to see how different filter settings can affect the results you’re getting presented.
Do you think if you built a large portfolio with these funds for say 20+years, could it be difficult to sell? Low liquidity compared VWRP?
I’m currently swaying towards these funds with higher fees due to their performance over time, as over time these higher fees are cancelled out by the performance of the index.
Picking a long term fund is hard! When I first started I threw everything into the S&P500 (VUSA) and it’s grown very nicely. Since then I’ve learnt that it’s broadly advised against, but picking a global fund is alot less straightforward.
Hi @mikea , I’m sorry but I do not have any foresight into how easy it would be of selling a portfolio consisting of these ETF’s in 20+ years time, tbh.
Also, “large portfolio” is subjective to each person of course.
These ETF’s, as they are currently offered/sold, may not even be available any longer by then or may have been taken over / merged into other ETF’s.
Maybe I didn’t explain it properly, what I meant was is the trading volume/fund size an indicator of how easy it is to sell, so should it be something to consider when buying into a fund or even monitoring over time. You always hear ‘oh this XYZ fund has done so much better than VWRP and much cheaper fee’ etc
Some of the funds mentioned in this thread have been much lower in size/volume, hence my question.
Basically, is it best to go for the more popular funds if you are in it for the long term is what I’m getting at.
On the last note, really enjoy Tony Newbatt’s channel! Not sure if I’ve watched that video but thanks for linking me to that segment.
Hi, as for the selling bit… I don’t know. I do not take trading volume into account when making a decision to invest in an ETF…
As I said before - you need to make sure that you’re comparing like-for-like when you compare ETF’s, especially when it comes to which index they track and whether they use Sampling or Full Replication to generate the ETF.
This is such a great thread and I was desperately looking for some advice on investengine ETFs. Just want to thank @Pinch for all his comments. I’m sure I can learn a lot form his experience Are you invested in those 6 ETFs @Pinch? I would be interested in looking at what funds you have in your portfolio. I am a S&S person but for this year ive joined investengine to try their ETFs due to the cost affordability they offer. Thank you
@brunold85
Morning ,
At the moment I do not hold any of the 6 ETF’s mentioned in my post on 27/02. I did hold VWRP but have sold my holding since and moved the money into SDIP/QYLP.
I do still hold FTSE All-World UCITS ETF (VWRL) though - this is the dividend-paying version of VWRP.
