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Vanguard goes after Hargreaves with discount fund platform

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Vanguard goes after Hargreaves with discount fund platform

Vanguard has launched an online service for individual UK investors, reducing its investable minimum for direct access to its funds from £100,000 to £500.

The house said that its all-in costs for even small sums would be significantly lower than major third-party platforms, citing a £23 annual cost of investing £10,000 into its Vanguard UK All Share fund, versus £49.58 elsewhere. 

The service will provide investors with direct access to the firm’s index and active funds range by investing a minimum lump sum of £500 or a minimum monthly savings contribution of £100.

Investors will pay an account administration fee of 0.15% a year for assets of up to £250,000, capped at £375, in addition to a ongoing charge figure (OCF) across its fund range of 0.14%. 

‘Only recently, the FCA’s interim asset management market study report stressed asset managers' obligation to act in the best interests of investors, including requiring the industry to show how it delivers value for money,’ said Sean Hagerty, head of Vanguard’s European business.

‘It also highlighted that fees have not decreased enough based on the economies of scale achieved by the industry. Vanguard agrees with these conclusions.

'This is why we are launching our new service – we want to offer investors the value for money they deserve.’

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