MoneyTalk

 

The Best Funds For Your Lifestyle

01 August 2011
In this week’s episode:

David chats with Tom Rampulla, Managing Director of Vanguard UK. They look at the growth in popularity of Exchange Traded Funds and examine why John Bogle likened buying ETFs to owning a Purdey shotgun. Tom also looks at asset allocation and explains how Life Strategy funds can help provide an all-in-one solution to control your risk.

 

A transcript of this podcast is also available.

David Kuo and Tom Rampulla
David Kuo and Tom Rampulla

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

piecan 01 Aug 2011 , 12:21pm

I could be a great fan of Vanguard if they had more providers. I don't want to be forced to invest with someone I don't want to in order to access their products. If they want our business it's up to them to make them more widely available.

rober00 01 Aug 2011 , 4:49pm

Interesting article David!!!

pdr65 02 Aug 2011 , 5:53pm

Please excuse a direct reply from a product provider...

I too would like our funds to be more widely available but am very pleased with the support we have received from investors using platforms that charge an explicit fee for their services such as Alliance Trust Savings, Bestinvest or Sippdeal.

However, today the majority of platforms used by direct investors operate a very different business model which entails the fund manager paying them a rebate or commission, typically between 0.25% and 0.75% pa. There's an obvious arithmetic challenge of paying the platform more than we charge the end investor but its more than that as we at Vanguard have a policy of not paying for distribution.

This policy has served Vanguard well wherever we operate and as it happens is very much in line with, even ahead of, the views outlined in the FSA's latest paper on platforms, PS11/9, published on 1st August: In that the FSA stated it would be desirable "to ban ... product provider payments to platforms".

Peter Robertson
Head of Business Development and Strategy

pdr65 02 Aug 2011 , 5:55pm

Sorry, should have added a bit to the post above

Even before the FSA's announcement, most commission based platforms were working on a fee based model and we very much hope that as these models are introduced our funds will become more widely available.

Peter Robertson

rgb73 04 Aug 2011 , 11:58pm

Hopefully their funds will become more widely available when their range of ETFs come onstream - later this year (?).

Currently thats how I do much of my investing but plan to eventually flip everything to Vanguard. If they ever offer brokerage accounts (so that buying Vanguard ETFs is commission free) as they do in the US I'll also be moving there - they'll definitely get my business.

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MoneyTalk is a podcast from The Motley Fool (UK). Hosted by David Kuo, it’s a lively roundtable discussion where Fool writers and guests from the world of money thrash out the financial issues of the day.

Join us as we take an irreverent look at anything and everything to do with shares – from how to pick your first share to how to manage your own pension to what mini skirts have to do with Britain's economy (quite a lot, according to David).

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About the presenter

David Kuo is The Motley Fool’s media personality. He can be heard on BBC London’s (94.9FM) Breakfast Show where he arouses listeners every weekday morning with his unique brand of financial news. He is also a regular commentator on national news programmes including CNBC, BBC News, and Sky News.

David stumbled into the world of broadcasting at the turn of the Millennium when he was invited to comment on the stock market crash. He says, “I think I stunned Londoners speechless when I said the good thing about the crash is that shares are now more affordable for people who want to invest in the stock market!”

His attitude to investing has never wavered, as he always sees downturns in the market as a buying opportunity for long-term investors.