The Index Funds Challenge

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Nomad
Posts: 203
Joined: Wed May 16, 2018 5:23 pm
Location: UK

The Index Funds Challenge

Post by Nomad » Wed Sep 18, 2019 3:26 pm

There seems to be a great deal of confidence in the wisdom of investing in low cost trackers funds.

I would like to challenge advocates of these funds to list the index funds they use, and what they are worth today in a specified monetary unit.
Then we can see how they do over time and compare them to some actively managed funds I will we suggest as alternatives.

I just noticed that we are nearly into Autumn, we can check on progress with each changing season.
Last edited by Nomad on Thu Sep 19, 2019 6:34 pm, edited 1 time in total.

Seppia
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Location: Italy

Re: The Index Funds Challenge

Post by Seppia » Wed Sep 18, 2019 4:56 pm

Great idea.
I’ll take a low fee World ex-USA, vanguard’s VEU works.
100% weight.
Time horizon should be ideally 10 years
Obviously we should measure total return, net of fees.
I would also say that allowed entries must be funds/etfs that are open for investment, so not stuff like Renaissance’s employees only fund for example.

Nomad
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Location: UK

Re: The Index Funds Challenge

Post by Nomad » Wed Sep 18, 2019 6:58 pm

Ok, the VEU fund according to Yahoo finance is:
$50.61 or £40.58

To mimic a worldwide fund without any US stocks I will go with four funds at 25% each.
Fidelity European class W (Accumulation) = £17.91 ( fees = 0.92% ).
Lindsell Train UK Equity (Accumulation) = £1.9954 ( fees = 0.51% ).
Lindsell Train Japanese Equity class B (Income) = £2.8045 ( fees = 0.73% ).
First State Greater China growth class B (Accumulation) = £10.1758 ( fees = 1.0 %)
Last edited by Nomad on Fri Sep 27, 2019 3:21 am, edited 2 times in total.

Nomad
Posts: 203
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Location: UK

Re: The Index Funds Challenge

Post by Nomad » Wed Sep 18, 2019 7:05 pm

If someone wants to go with a global tracker fund including US companies, I have a very simple option in response.
Any takers for a global low-cost index fund?

zocab
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Joined: Fri Jul 26, 2019 1:04 pm

Re: The Index Funds Challenge

Post by zocab » Thu Sep 19, 2019 11:07 am

Nomad wrote:
Wed Sep 18, 2019 7:05 pm
If someone wants to go with a global tracker fund including US companies, I have a very simple option in response.
Any takers for a global low-cost index fund?
VT seems to be the global index of choice for many people. (That said, it's actually cheaper to get the exact same exposure by comining VTI + VEU instead of VT, but the differences are likely to be negligible.)

Nomad
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Location: UK

Re: The Index Funds Challenge

Post by Nomad » Thu Sep 19, 2019 1:52 pm

zocab wrote:
Thu Sep 19, 2019 11:07 am
VT seems to be the global index of choice for many people. (That said, it's actually cheaper to get the exact same exposure by comining VTI + VEU instead of VT, but the differences are likely to be negligible.)
Ok, challenge accepted.

VT is today $78.18 or £60.73 and has fees of (0.09%)

The global funds I pick are:
50% Fundsmith Equity currently £4.6755 (fees are 0.95%)
50% Lindsell Train Global Equity currently £2.7485 (fees are 0.5% with my broker)

Let battle commence.

Gilberto de Piento
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Re: The Index Funds Challenge

Post by Gilberto de Piento » Thu Sep 19, 2019 7:35 pm

The MMM crowd loves VTSAX. I own a little. How about that one?

steveo73
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Joined: Sat Jul 06, 2013 6:52 pm

Re: The Index Funds Challenge

Post by steveo73 » Thu Sep 19, 2019 10:08 pm

Index funds and prices below:-

VGS:- 78.71 (International Equities Tracker)
VAS:- 86.74 (Australian Equities Tracker)
VAF:- 52.72 (Australian Bonds Tracker)

I have no idea how you are going to make this a challenge though. I'm in Australia and all those funds are in AUD. You'd also have to carry the challenge on over 30 odd years. We already now how this turns out anyway - the index wins. We saw Warren's bet on this recently and the active traders were decimated.

Nomad
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Location: UK

Re: The Index Funds Challenge

Post by Nomad » Fri Sep 20, 2019 1:35 am

Gilberto de Piento wrote:
Thu Sep 19, 2019 7:35 pm
The MMM crowd loves VTSAX. I own a little. How about that one?
Ok. VTSAX is today $74.35 which is £59.14

My alternative is this fund:
100% Investec American Franchise class I Accumulation GBP which today is (£3.2148 fees are 0.83%).

That is three comparisons on the go.

Nomad
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Location: UK

Re: The Index Funds Challenge

Post by Nomad » Fri Sep 20, 2019 1:48 am

steveo73 wrote:
Thu Sep 19, 2019 10:08 pm
Index funds and prices below:-

VGS:- 78.71 (International Equities Tracker)
VAS:- 86.74 (Australian Equities Tracker)
VAF:- 52.72 (Australian Bonds Tracker)

I have no idea how you are going to make this a challenge though. I'm in Australia and all those funds are in AUD. You'd also have to carry the challenge on over 30 odd years. We already now how this turns out anyway - the index wins. We saw Warren's bet on this recently and the active traders were decimated.
I can't offer an actively managed alternative to VAS or VAF.

However, my alternative to VGS is the two Global funds I mentioned earlier.

VGS price of 78.71 (Australian) is 42.6 (GBP).
Actively managed alternatives are:
50% Fundsmith Equity currently £4.6755 (fees are 0.95%)
50% Lindsell Train Global Equity currently £2.7485 (fees are 0.5% with my broker)

Seppia
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Re: The Index Funds Challenge

Post by Seppia » Fri Sep 20, 2019 1:49 am

Nomad wrote:
Wed Sep 18, 2019 6:58 pm
Ok, the VEU fund according to Yahoo finance is:
$50.61 or £40.58

To mimic a worldwide fund without any US stocks I will go with four funds at 25% each.
Fidelity European class W (Accumulation) = £17.91 ( fees = 0.92% ).
Lindsell Train UK Equity (Accumulation) = £4.8816 ( fees = 0.65% ).
Lindsell Train Japanese Equity class B (Income) = £2.8045 ( fees = 0.73% ).
First State Greater China growth class B (Accumulation) = £10.1758 ( fees = 1.0 %)
Great.
Couple of details:

1- what's the currency of refrence? It could matter as the weighting is different between our two allocations. I suggest we use the USD.
2- we will obviously compare total return (meaning including dividends for my fund and for your Japanese Equity fund), as otherwise we'd be comparing apples to oranges (your other funds automatically reinvest the dividends and reflect them into the price)

Nomad
Posts: 203
Joined: Wed May 16, 2018 5:23 pm
Location: UK

Re: The Index Funds Challenge

Post by Nomad » Fri Sep 20, 2019 2:03 am

Seppia wrote:
Fri Sep 20, 2019 1:49 am
Great.
Couple of details:

1- what's the currency of refrence? It could matter as the weighting is different between our two allocations. I suggest we use the USD.
2- we will obviously compare total return (meaning including dividends for my fund and for your Japanese Equity fund), as otherwise we'd be comparing apples to oranges (your other funds automatically reinvest the dividends and reflect them into the price)
1. I quoted GBP because that's my local currency. We could list the values in US dollars too, even though we don't have any US investments.
As long as the conversions are made on the same day it doesn't matter.
2. Yes. You will need to supply appropriate details.

Nomad
Posts: 203
Joined: Wed May 16, 2018 5:23 pm
Location: UK

Re: The Index Funds Challenge

Post by Nomad » Fri Sep 27, 2019 3:25 am

Correction. I had the price of Lindsell Train UK Equity (Accumulation) incorrect on the original post. Also, the fee was incorrect.
I think I was looking at something entirely different.
This is the correct one.
https://markets.ft.com/data/funds/tears ... FLM156:GBX

https://www.fundslibrary.co.uk/FundsLib ... rJiM3f&r=1

Nomad
Posts: 203
Joined: Wed May 16, 2018 5:23 pm
Location: UK

Re: The Index Funds Challenge

Post by Nomad » Fri Sep 27, 2019 3:53 am

Just the current numbers for today but notionally this is for Autumn 2019.
I think we will have some difference in Winter or Spring.

Autumn 2019 27/09/19

Vangaurd VEU ($) 50.07
Vangaurd VEU (£) 40.75

Fidelity European class W (£) 17.98
Lindsell Train UK Equity (£) 1.9827
Lindsell Train Japanese Equity (£) 2.88
First State Greater China growth (£) 10.0363

Vangaurd VT ($) 75.02
Vangaurd VT (£) 61.04

Fundsmith Equity (£) 4.7124
Lindsell Train Global Equity (£) 2.7306

Vangaurd VTSAX ($) 73.57
Vangaurd VTSAX (£) 59.86

Investec American Franchise (£) 3.2311

Vangaurd VGS (Au) 78.34
Vangaurd VGS (£) 43.16

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