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Fee cuts show Vanguard's continuing commitment to giving UK investors value for money

23 October 2019 | Topical insights

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Vanguard has today demonstrated its commitment to giving investors a fair deal by reducing fees across many of our single-strategy index funds.

Earlier this year we reduced the fees on four of our active funds. We have now cut the OCF on an additional 36 funds in all – 13 exchange-traded funds, 22 index funds and the Vanguard Sterling Short-Term Money Market Fund.

The latest changes ensure Vanguard's UCITS index funds and ETFs remain attractive, by reducing headline fees (OCFs) and increasing consistency across the ranges.  As a result of the move, the average OCF across the full range of Vanguard funds available to retail investors in the UK is now just 0.2%.

In the case of ETFs, the average OCF is down to 0.1%, while for index-tracking mutual funds it is reduced to 0.15%.

Since 1975, Vanguard has led the way in giving investors a fair deal by providing good-value, high-quality investments. It is the reason that over 30 million people worldwide trust Vanguard with £4.7 trillion of their savings1.

Studies have repeatedly shown that low costs are one of the best indicators of a fund's potential to perform over time2.

We are delighted to support you in helping your clients achieve investment success.

 

Fee reductions

Irish Domiciled ETF fee reductions

Old OCF

New OCF

FTSE All-World UCITS ETF

0.25%

0.22%

FTSE Developed Asia Pacific ex Japan UCITS ETF

0.22%

0.15%

FTSE Developed Europe ex UK UCITS ETF

0.12%

0.10%

FTSE Developed Europe UCITS ETF

0.12%

0.10%

FTSE Developed World UCITS ETF

0.18%

0.12%

FTSE Emerging Markets UCITS ETF

0.25%

0.22%

FTSE Japan UCITS ETF

0.19%

0.15%

EUR Corporate Bond UCITS ETF

0.12%

0.09%

EUR Eurozone Government Bond UCITS ETF

0.12%

0.07%

U.K. Gilt UCITS ETF

0.12%

0.07%

USD Corporate 1-3 Year Bond UCITS ETF

0.15%

0.09%

USD Corporate Bond UCITS ETF

0.12%

0.09%

USD Treasury Bond UCITS ETF

0.12%

0.07%

 

Index Fund fee reductions (Investor share class)

Domicile

Old OCF

New OCF

Emerging Markets Stock Index Fund

Ireland

0.27%

0.23%

Global Small-Cap Index Fund

Ireland

0.38%

0.29%

Japan Stock Index Fund

Ireland

0.23%

0.16%

Pacific ex-Japan Stock Index Fund

Ireland

0.23%

0.16%

SRI European Stock Fund

Ireland

0.30%

0.16%

SRI Global Stock Fund

Ireland

0.35%

0.22%

Euro Government Bond Index Fund

Ireland

0.25%

0.12%

Euro Investment Grade Bond Index Fund

Ireland

0.30%

0.12%

Global Corporate Bond Index Fund

Ireland

0.25%

0.18%

Global Short-Term Corporate Bond Index Fund

Ireland

0.25%

0.18%

Japan Government Bond Index Fund

Ireland

0.25%

0.12%

U.K. Government Bond Index Fund

Ireland

0.15%

0.12%

U.K. Investment Grade Bond Index Fund

Ireland

0.15%

0.12%

U.K. Short-Term Investment Grade Bond Index Fund

Ireland

0.15%

0.12%

U.S. Government Bond Index Fund

Ireland

0.25%

0.12%

U.S. Investment Grade Credit Index Fund

Ireland

0.30%

0.12%

FTSE Developed World ex-U.K. Equity Index Fund

UK

0.15%

0.14%

FTSE Global All Cap Index Fund

UK

0.24%

0.23%

FTSE U.K. All Share Index Unit Trust

UK

0.08%

0.06%

FTSE U.K. Equity Income Index Fund

UK

0.22%

0.14%

U.K. Inflation-Linked Gilt Index Fund

UK

0.15%

0.12%

U.K. Long Duration Gilt Index Fund

UK

0.15%

0.12%

 

Active Fund fee reductions  (Investor share class)

Domicile

Old OCF

New OCF

Sterling Short-Term Money Market Fund

UK

0.15%

0.12%

1 As at 30 September 2019

2 Kinnel, Russel, 2010. How Expense Ratios and Star Ratings Predict Success; available athttps://www.morningstar.com/articles/347327/how-expense-ratios-and-star-ratings-predict-succes.html

 

Investment risk information:

The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.

Past performance is not a reliable indicator of future results.

ETF shares can be bought or sold only through a broker. Investing in ETFs entails stockbroker commission and a bid- offer spread which should be considered fully before investing.

An investment in a money market fund is not a guaranteed investment. An investment in a money market fund is different from an investment in deposits, as the amount invested in a money market fund is capable of fluctuation. Money market funds do not rely on external support for guaranteeing the liquidity of the money market fund or stabilising the Net Asset Value per share. The risk of loss of the amount invested shall be borne by the investor.

Other important information:

This document is directed at professional investors and should not be distributed to, or relied upon by retail investors.

This article is designed for use by, and is directed only at persons resident in the UK.

The material contained in this article is not to be regarded as an offer to buy or sell or the solicitation of any offer to buy or sell securities in any jurisdiction where such an offer or solicitation is against the law, or to anyone to whom it is unlawful to make such an offer or solicitation, or if the person making the offer or solicitation is not qualified to do so. The information in this article is general in nature and does not constitute legal, tax, or investment advice. Potential investors are urged to consult their professional advisers on the implications of making an investment in, holding or disposing of units or shares of, and the receipt of distribution from any investment.

Vanguard Asset Management, Limited only gives information on products and services and does not give investment advice based on individual circumstances. If you have any questions related to your investment decision or the suitability or appropriateness for you of the products described in this article, please contact your financial adviser.

The opinions expressed in this presentation are those of individual speakers and may not be representative of Vanguard Asset Management, Limited.

The Manager of Vanguard Investment Series plc is Vanguard Group (Ireland) Limited. Vanguard Asset Management, Limited is a distributor of Vanguard Investment Series plc.

The Manager of Vanguard Funds plc is Vanguard Group (Ireland) Limited. Vanguard Asset Management, Limited is a distributor for Vanguard Funds plc.

The Authorised Corporate Director for Vanguard Investment Funds ICVC is Vanguard Investments UK, Limited.  Vanguard Asset Management, Limited is a distributor of Vanguard Investment Funds ICVC.

The Authorised Corporate Director for Vanguard® Investments Money Market Funds is Vanguard Investments UK, Limited. Vanguard Asset Management, Limited is a distributor of Vanguard® Investments Money Market Funds.

The KIID and the Prospectus for all these funds are available from Vanguard via our website https://www.vanguardinvestor.co.uk

Issued by Vanguard Asset Management, Limited which is authorised and regulated in the UK by the Financial Conduct Authority.

© 2019 Vanguard Asset Management, Limited. All rights reserved.

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