Vanguard has launched a new investment service for retail investors in the UK that provides low-cost direct access to the firm’s ETF range as well as Vanguard’s other funds.
Sean Hagerty, Head of Vanguard’s European business.
Sean Hagerty, head of Vanguard’s European business, commented: “Vanguard’s new online investment service is designed to help simplify and lower the cost of investing in the UK. Only recently, the FCA’s interim asset management market study report stressed asset managers’ obligation to act in the best interest of investors, including requiring the industry to show how it delivers value for money.
“We aim to deliver investors the highest value investment products and services available with an unwavering commitment to lowering the cost of investing in the UK.”
The new service gives investors access to 65 Vanguard funds including its ETFs, LifeStrategy range, index funds, target retirement funds (TRFs) and actively managed funds. All the funds are available via an ISA, Junior ISA or general account. A SIPP will be added in due course.
To access the funds directly, investors will pay an account administration fee of just 0.15% per annum in addition to the funds’ ongoing charges. There is no account fee above the first £250,000 invested, meaning the maximum account fee payable is just £375 each year. Investors can invest with a minimum lump sum amount of £500 and/or a minimum monthly savings contribution of £100.
There will be 22 Vanguard ETFs available through the service comprising 16 equity ETFs and six fixed income ETFs. The equity ETFs cover a wide range of broad developed and emerging market exposures, as well as four global factor funds. The fixed income range offers exposure to a mix of US, Europe and UK sovereign and corporate debt plus an emerging market sovereign debt ETF.
The cheapest ETF available is the Vanguard S&P 500 UCITS ETF (LON: VUSA) which has an ongoing charge of 0.07% and with AUM of $18bn is also the largest of Vanguard’s ETF suite. Also available is the Vanguard FTSE 100 UCITS ETF (LON: VUKE) which has an ongoing charge of 0.09% and AUM of £2.5bn.
Ryan Barrows, head of personal investing at Vanguard, said: “Vanguard believes there are four simple and straightforward principles that lead to long-term investment success. These include: creating clear, appropriate investment goals; developing a suitable asset allocation using broadly-diversified funds; minimising cost; and maintaining perspective and long-term discipline. Vanguard’s focus is on helping more investors harness these principles with clear information and education so they can help keep more of their investment returns.”