Three days ago Vanguard Australia launched a suite of new products. These products are a game changer for Australians in my opinion.
Check out this article from the Financial Standard
|A beautiful 1940's dining room in an airBnB we stayed at recently|
The new Vanguard suite has four Diversified Index ETF options:
- Vanguard Diversified Conservative (VDCO)
- Vanguard Diversified Balanced (VDBA)
- Vanguard Diversified Growth (VDGR)
- Vanguard Diversified High Growth (VDHG)
Our US readers have had access to a long list of cheap US Vanguard offerings for many years now, however Vanguard's Australian arm are still growing and evolving. Generally speaking Vanguard are known as arguably the holy grail of investment companies world-wide and are committed to low costs and prudent investment policies.
|Our airBnB 1940s bedroom - on the Hay Plains Australia|
I have been looking at so many differing non-direct share/ETF options for investing outside of Superannuation including Robo Investors like Stockspot et al, Vanguard Australian Retail funds etc but the fees for these non-direct share/ETF investment products have been a little too much for my liking and thus I have defaulted to buying ETF's and LIC's directly which only incur the cost of the trade and the underlying MER (Management Expense Ratio - a fancy name for the inbuilt fee).
Whilst I may still stick with directly trading in ETFs and LICs (this is still the cheapest way), Vanguard Australia's introduction of these four new Diversified Index ETF's is a real game changer for those of us needing and wanting to invest but are too time/inclination poor (or even fearful) to be mucking around building a portfolio. Choosing one of these four new options and investing regularly may just be the answer to the simplest way to build wealth outside of superannuation in Australia. Vanguard Australia has created a real game changer with these four new offerings.
|A 1940s cabinet full of local jams, jellies and chutneys for sale|
Theoretically I would choose the Vanguard Diversified High Growth (VDHG) option as the 90% growth appeals to my needs.
- At 0.27% MER (for every $1 million invested you would pay $2700 yearly) this is a reasonable and fair fee for its excellent inbuilt growth diversification strategy using both international and Australian securities.
- 90% growth assets and 10% income assets (potentially tax effective)
- Australian Domiciled, so no annoying international W-BEN8-E forms - it is all done for you by the fund.
- It's Vanguard - highly trustworthy company
- A full portfolio in one easy aggressive growth product.
- Offers DRP (Dividend Reinvestment Plan)
- I suspect these ETF's are subsets of Vanguard Australia's Wholesale Diversified Funds of the same name. If so, then the return, stock holdings and structure of these funds are excellent.
For Australians, two of the barriers to getting into Vanguard's Diversified Funds were the $500,000 minimum entry into their equivalent wholesale funds or the 0.90% MER on their equivalent retail funds. These four new offering have instantly removed those two barriers ....well done Vanguard!
|The 1940's fireplace with all the proper period utensils|
Here is the link to Vanguard Australia here. Scroll to the bottom of the list and you will see them with "new" next to each offering. Also, Vanguard's write up here.
Of course I am not a qualified finance guy, so all this information has been for sharing and encouragement only and cannot be classified as financial advice. Do your own research! Oh, and I am NOT getting paid by Vanguard either.
Take care and stay nice
Mr HM (Phil)
|1940's single twin beds|
P.S. We recently stayed on the Hay Plains as we were travelling to Adelaide. We stayed in an air BnB all done out in 1940s style. It was just wonderful. I felt totally at home. The post header picture is taken from Granite Island looking back along the jetty to Victor Harbor South Australia.