So I’ve been playing with the figures following the most recent Money Unshackled video, it looks like you could fairly adequately reconstruct VWRL (Vanguard’s Global ETF) but with lower fees by pairing different ETFs from the different providers in Freetrade. I’ve worked on using:
VUSA - S&P 500
VUKE - FTSE 100 (Option to add in VMID for more UK)
XSX6 - Euro Tracker
VJPN - Japan
CPJ1 - Pacific excluding Japan
EMIM - Emerging Markets
So we’re missing a few smaller bits but essentially it’s all there.
Breaking it down like this would give you the option to tilt the portfolio how you see fit. I’d estimate something like this:
VWRL has a 10% allocation to emerging markets, so if you do 90% Developed World - VEVE (0.12%) and 10% Emerging Markets - VFEM (0.22%) the OCF is 0.13% a 40% saving over VWRL.
I need to add Japan. I like a monthly dividend to keep me strong if and when the market tanks and to reinvest the dividends so I have City of London Investment Trust to pay out dividends in the missing months. It has a high yield and 50+ years of dividend increases. I will sort out the allocation as time goes on as I’m just starting out on the long road …
I did something similar with my Vanguard Isa before deciding it wasn’t worth the hassle to save a relatively small amount. I used VNRT rather than VUSA to include exposure to Canada.
One thing worth considering: it’s probably worth sticking to either the MSCI or Ftse indices to avoid overlap or omissions. The emerging markets indices include different countries, for example. I believe XSX6 includes the UK, so you’d probably want an ex-UK ETF and VUKE/VMID or just one Europe-wide ETF.
Great Post. I’ve been looking at doing something similar. I have been using Vanguard Life strategy funds so looking to replicate something similar but there are a few gaps on what’s on offer.
The only real thing stopping me at the moment is I can’t build an ETF portfolio until we have fractionals.
But I’d been keen to see your final setup if you don’t mind
EMIM has a wider breadth of Emerging Market hence the choice, you could swap out for VFEM and get the dividend if required and still save money over VWRL.
Depends how long you’re in the market for. Compounded over 35 years it would add up to a decent amount, but it really depends on how hands on you’d like to be.
I just found it wasn’t worth the effort of rebalancing etc. Even if it’s only a few hours a quarter, I could earn far more by working than I’d save with that time.
It almost defeats the point of passive investing too, ie you’re making active decisions about how much to allocate to Japan and so on.
I’m all for cutting costs, but I got pretty OCD about it and there’s a lot to be said for the ‘set and forget’ approach.
But I am not sure I like the lacking of a UK focused ETF. However, VEUR does have a 26.7% weight to the UK markets. But the lack of UK exposure allows me to do some stock picking from the UK, as I would like to still have some positions in companies I believe in like GAW
What are peoples thoughts on the above? Could this be a potential rebalance chance in April ?
So this is where my maths fails me. I have a list of about 8 ETFs I want to buy. Each have different costs (obviously) and different weight. Any ideas how to easily workout how many shares of each ETF I want to buy with each investment.
Simple example. Let’s assume I wanted to invest £300 monthly across 3 ETFs (fictional):
