The firm’s full line-up in the UK including ETFs, index funds and its actively managed fund range have an average ongoing charges figure (OCF) of 0.20%. The ETF index line-up has an average OCF of 0.10%.
Vanguard is in competition with the likes of BlackRock which cut its fees on 12 index funds in August and DWS slashing the costs for five of its core fixed income ETFs earlier this year.
The latest drop in fees is Vanguard’s bid to argue against the misconception that the more you pay for an investment, the better it performs.
Vanguard has also included the Vanguard Sterling Short-Term Money Market fund in the latest round of fee cuts, falling from 0.15% to 0.12%.
Why the hype around fee cuts is overdone
Sean Hagerty, head of Vanguard for Europe, commented: “For too long investors have been poorly served with high-cost, complex investments.
“More work needs to be done to ensure investors understand the impact of costs on investment returns. Investors cannot control the markets, but they can control the fees they pay.”
Vanguard’s reduced investment products include:
| ETFs | Old OCF | New OCF |
| FTSE All-World UCITS ETF | 0.25% | 0.22% |
| FTSE Developed Asia Pacific ex Japan UCITS ETF | 0.22% | 0.15% |
| FTSE Developed Europe ex UK UCITS ETF | 0.12% | 0.10% |
| FTSE Developed Europe UCITS ETF | 0.12% | 0.10% |
| FTSE Developed World UCITS ETF | 0.18% | 0.12% |
| FTSE Emerging Markets UCITS ETF | 0.25% | 0.22% |
| FTSE Japan UCITS ETF | 0.19% | 0.15% |
| EUR Corporate Bond UCITS ETF | 0.12% | 0.09% |
| EUR Eurozone Government Bond UCITS ETF | 0.12% | 0.07% |
| UK Gilt UCITS ETF | 0.12% | 0.07% |
| USD Corporate 1-3 Year Bond UCITS ETF | 0.15% | 0.09% |
| USD Corporate Bond UCITS ETF | 0.12% | 0.09% |
| USD Treasury Bond UCITS ETF | 0.12% | 0.07% |
| Index Funds | Domicile | Old OCF | New OCF |
| Emerging Markets Stock Index Fund | Ireland | 0.27% | 0.23% |
| Global Small-Cap Index Fund | Ireland | 0.38% | 0.29% |
| Japan Stock Index Fund | Ireland | 0.23% | 0.16% |
| Pacific ex-Japan Stock Index Fund | Ireland | 0.23% | 0.16% |
| SRI European Stock Fund | Ireland | 0.30% | 0.16% |
| SRI Global Stock Fund | Ireland | 0.35% | 0.22% |
| Euro Government Bond Index Fund | Ireland | 0.25% | 0.12% |
| Euro Investment Grade Bond Index Fund | Ireland | 0.30% | 0.12% |
| Global Corporate Bond Index Fund | Ireland | 0.25% | 0.18% |
| Global Short-Term Corporate Bond Index Fund | Ireland | 0.25% | 0.18% |
| Japan Government Bond Index Fund | Ireland | 0.25% | 0.12% |
| UK Government Bond Index Fund | Ireland | 0.15% | 0.12% |
| UK Investment Grade Bond Index Fund | Ireland | 0.15% | 0.12% |
| UK Short-Term Investment Grade Bond Index Fund | Ireland | 0.15% | 0.12% |
| US Government Bond Index Fund | Ireland | 0.25% | 0.12% |
| US Investment Grade Credit Index Fund | Ireland | 0.30% | 0.12% |
| FTSE Developed World ex-UK Equity Index Fund | UK | 0.15% | 0.14% |
| FTSE Global All Cap Index Fund | UK | 0.24% | 0.23% |
| FTSE UK All Share Index Unit Trust | UK | 0.08% | 0.06% |
| FTSE UK Equity Income Index Fund | UK | 0.22% | 0.14% |
| UK Inflation-Linked Gilt Index Fund | UK | 0.15% | 0.12% |
| UK Long Duration Gilt Index Fund | UK | 0.15% | 0.12% |
