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Don’t pay too much on your UK tracker fund

Some tracker funds charge 25 times more than others. Have you checked you're not paying over the odds?

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Index tracker funds are refreshingly simple. They aim to do what they say on the tin, and track the performance of an index. With no fund managers actively choosing the holdings, charges should be very low. But that’s not always the case.

We’ve taken a look at the UK trackers held by HL clients. The results are stark. Some are charging over 25 times more than others.

That’s a big difference in charges on investments that essentially do the same thing. And this can have a huge effect over the long term.

Over 20 years there could be over £2,700 difference in charges on a £10,000 investment assuming a 5% p.a. growth rate. Platform charges will also apply.

The increasing popularity of tracker funds has helped drive down a lot of these charges in recent years. We think investors should check what they are being charged compared to the alternatives. It’s also a good opportunity to check if a particular investment still meets their objectives.

This article is not personal advice. All investments can fall as well as rise in value so you could make a loss. If you are unsure whether an investment is right for you seek advice.

Below is a list of FTSE All-Share and FTSE 100 trackers held by HL clients.

FTSE All-Share Trackers

Fund Name Ongoing Charge (OCF/TER) Ongoing Saving Net Ongoing Charge Annual charge on a £10,000 investment Key Investor Information Document (KIID)
Legal & General UK Index (Class C) 0.10% 0.06% 0.04% £4 KIID
Fidelity Index UK (Class P) 0.06% 0.00% 0.06% £6 KIID
iShares UK Equity Index (Class D) 0.06% 0.00% 0.06% £6 KIID
Vanguard FTSE UK All Share Index 0.06% 0.00% 0.06% £6 KIID
HSBC FTSE All-Share Index (Class C) 0.07% 0.00% 0.07% £7 KIID
ASI UK All Share Tracker 0.11% 0.00% 0.11% £11 KIID
Aviva Inv UK Index Tracking (Class 2) 0.23% 0.00% 0.23% £23 KIID
BMO FTSE All Share Tracker (Class 2) 0.33% 0.00% 0.33% £33 KIID
Janus Henderson UK Index (Class I) 0.36% 0.00% 0.36% £36 KIID
Scottish Widows UK All Share Tracker* 0.36% 0.00% 0.36% £36 N/A
M&G Index Tracker (Class A) 0.45% 0.00% 0.45% £45 KIID
Virgin FTSE All Share Tracker Fund 0.60% 0.00% 0.60% £60 KIID
Halifax (HBOS) UK FTSE All-Share Index Tracker C** 1.03% 0.00% 1.03% £103 KIID

*These funds are not generally available for new investment through HL.

**The factsheets for these funds cannot be viewed online but they can still be bought and sold (telephone or post only).

FTSE 100 Trackers

Fund Name Ongoing Charge (OCF/TER) Ongoing Saving Net Ongoing Charge Annual charge on a £10,000 investment Key Investor Information Document (KIID)
Legal & General UK 100 Index (Class C) 0.10% 0.04% 0.06% £6 KIID
Vanguard FTSE 100 Index 0.06% 0.00% 0.06% £6 KIID
iShares 100 UK Equity Index (D) 0.07% 0.00% 0.07% £7 KIID
Janus Henderson UK Tracker 0.07% 0.00% 0.07% £7 KIID
HSBC FTSE 100 Index (Class C) 0.18% 0.00% 0.18% £18 KIID
OneFamily Stockmarket 100 Growth* 0.35% 0.00% 0.35% £35 N/A
Scottish Widows UK Tracker** 0.50% 0.00% 0.50% £50 KIID
Marks & Spencer UK 100 Companies* 0.60% 0.00% 0.60% £60 N/A
Halifax (HBOS) UK FTSE 100 Index Tracking B** 1.00% 0.00% 1.00% £100 KIID

*These funds are not generally available for new investment through HL.

**The factsheets for these funds cannot be viewed online but they can still be bought and sold (telephone or post only).

Our favourite tracker funds

Our favourite tracker funds have some of the lowest charges in the market, but they’re also rigorously assessed for their quality , as it’s also important to consider other factors such as how the fund replicates the index.

View Wealth 50 tracker funds

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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