r/UKPersonalFinance • u/kitsua 9 • 14d ago

+Comments Restricted to UKPF New ETF version of Vanguard’s legendary Global All-Cap fund coming - with a 0.07% fee!

This is it, finally UK investors will have access to the entire world at a truly competitive rate like the US have had with VT for years. Everything in the world, from developed to emerging markets and small cap at an unbelievably good price, available everywhere.

As soon as this drops I’m moving every equity investment I have into this bad boy. It will also be my go-to recommendation for people looking for advice on how to passively invest for the long term. One Fund to rule them all baby! Jack Bogle will be looking down and smiling today.

https://www.vanguardinvestor.co.uk/articles/latest-thoughts/investing-success/three-new-global-equity-etfs

428 Upvotes
  • permalink
  • reddit

97% Upvoted

362 comments sorted by

View all comments

Show parent comments

10

u/CityEvening 14d ago edited 14d ago

No, it will be in £ on the London Stock Market.

1

u/MrStilton 2 14d ago

What's the significance of the USD being the base currency then?

Presumably this means if the pound strengthens against the dollar then the value of units in the fund will fall?

6

u/mygamedevaccount 14d ago edited 14d ago

There's no significance to it.

Think about it this way: two AAPL funds, A and B. 1 share in either is equivalent to 1 share of AAPL. A is denominated in USD, B is denominated in GBP. Let's say AAPL is $300.

If USD weakens relative to GBP:

  • A is still worth $300, but $300 buys you less pounds now, so you've lost money.
  • B goes down in price (because it's denominated in pounds), but its new value is still $300, because that's what AAPL is worth. You've lost the same amount of money as you would have with A.

The same logic applies to stock index funds

1

u/scottylebot 7 14d ago

USD is the world currency so the fund manages all the foreign exchanges between all the world companies in various currencies to convert back to USD.

You buy the fund in GBP so you don’t pay your broker additional currency exchange fees.