Moneywise's First 50 Funds - 20 cheap tracker funds to use as core holdings

20 cheap tracker funds to use as core holdings

See our First 50 Funds for beginners homepage for links to the other funds in the list.

Instant portfolios

Vanguard LifeStrategy 20% Equity Inc or Acc

A low-risk fund that provides some upside potential from investing while limiting the risk of losing your money. It has 20% exposure to globally diversified equities with the remainder in globally diversified government and corporate bonds. The underlying portfolios are wholly made up of Vanguard index tracker funds. For a bit more risk, use the 40% equity version.

OCF: 0.22%
ISIN – Inc: GB00B4620290
Acc: GB00B4NXY349

Vanguard LifeStrategy 60% Equity Fund Inc or Acc

This instant medium-risk portfolio has 60% exposure to globally diversified shares with the rest in globally diversified government and corporate bonds.

OCF: 0.22%
ISIN – Inc: GB00B4R2F348
Acc: GB00B3TYHH97

Vanguard LifeStrategy 100% Equity Fund Inc or Acc

This one-stop fund is aimed at higher-risk investors, who don’t want to think about how to put a portfolio together. The main stock market exposure is to US shares, followed by UK shares. To reduce risk, go for the 80% version.

OCF: 0.22%
ISIN - Inc:
GB00B545NX97
Acc: GB00B41XG308

UK Shares

BlackRock 100 UK Equity Fund D Acc

By tracking performance of the FTSE 100 Index of the biggest companies traded on the London Stock Exchange, it seeks to achieve capital growth. Since launching the First 50 Funds in June 2016, the OCF has risen from 0.06% to 0.07%. This is still extremely cheap, however.

OCF: 0.07%
ISIN: GB00B7W4GQ69

L&G UK Index Trust I Acc

It aims to provide growth by replicating performance of the FTSE All Share Index. This index represents 98% of companies traded on the London Stock Exchange. The fund will invest almost entirely in company shares, but may use derivatives (contracts which have a value linked to the price of another asset) to help with efficient day-today management or to reduce some of the risks of the market.

OCF: 0.10%
ISIN: GB00B0CNGN12

HSBC FTSE 250 Index C Inc or Acc

Its goal is to provide long-term capital growth by matching the return of the FTSE 250 index, which represents medium-sized companies on the London Stock Exchange.

OCF: 0.18%
ISIN – Inc: GB00B80QFZ35
Acc: GB00B80QG052

Vanguard FTSE UK Equity Income Index Inc or Acc

Offering low-cost, diversified access to higher income UK shares, it tracks performance of the FTSE UK Equity Income Index, made up of the highest-dividend paying shares among the largest 350 companies on the London Stock Exchange.

OCF: 0.22%
ISIN – Inc: GB00B5B74684
Acc: GB00B59G4H82

Overseas shares

Fidelity Index World Fund W Inc or Acc

A good fund to start a portfolio with, it tracks performance of the MSCI World Net Return Index of large and medium-sized companies from more than 12 developed countries, including the UK.

OCF: 0.15%
ISIN – Inc: GB00BP8RYC79
Acc: GB00BLT1YP39

Vanguard FTSE Developed World ex-UK Equity Index Fund Inc or Acc

A good diversifier if you already have a lot of UK exposure in your portfolio.

OCF: 0.15%
ISIN – Inc: GB00B5B74F71
Acc: GB00B59G4Q73

L&G International Index Trust I Inc or Acc

It tracks the performance of the FTSE World (ex UK) Index, which has a broad spread of company shares from developed and emerging markets globally (excluding UK companies). It’s cheaper than the Vanguard fund, but includes emerging markets countries, so it might be a bit riskier.

OCF 0.13%
ISIN – Inc: GB00B2Q6HX78
Acc: GB00B2Q6HW61

Vanguard FTSE Developed Europe ex-UK Equity Index Inc or Acc

Good for instant exposure to developed countries in Europe, excluding the UK. Its main exposure is to French, German and Swiss companies.

OCF: 0.12%
ISIN – Inc: GB00B5B74N55
Acc: GB00B5B71H80

Higher risk overseas shares

Vanguard Global Small Cap Index Fund Inc or Acc

It tracks performance of the MSCI World Small Cap Index of smaller companies in developed countries.

OCF: 0.38%
ISIN – Inc: IE00B3X1LS57
Acc: IE00B3X1NT05

Fidelity Index Emerging Markets W  Inc or Acc

It aims to achieve long-term capital growth by closely matching performance of the MSCI Emerging Markets Index of rapidly developing economies.

OCF: 0.23%
ISIN – Inc: GB00BP8RYV68
Acc: GB00BLT1YT76

US Shares

HSBC American Index C Inc or Acc

Seeking long-term capital growth, it matches the return of the S&P 500 Index of 500 large companies listed on the New York Stock Exchange or NASDAQ (another American stock exchange).

OCF: 0.07%
ISIN – Inc: GB00B80QG490
Acc: GB00B80QG615

Legal & General US Index I Inc or Acc

Its goal is to track the performance of the FTSE USA Total Return Index, which captures more than 600 large and medium-sized US companies.

OCF: 0.10% (C Class is available via Hargreaves Lansdown for 0.06%)
ISIN – Inc: GB00B0CNGS66
Acc: GB00B0CNGT73

Bonds

Vanguard UK Government Bond Index Inc or Acc

This fund can be used to achieve lower-risk diversity from an equity portfolio. It seeks to provide returns consistent with the performance of a market-weighted bond index of UK government fi xed-income securities denominated in pound sterling.

OCF 0.15%
ISIN – Inc: IE00B1S75820
Acc: IE00B1S75374

Legal & General Short Dated Sterling Corporate Bond Index I Inc or Acc

Holds bonds consisting mainly of large, corporate investment-grade bond issues with maturities of between one and five years (the safer end of the maturity spectrum because interest rate changes will have less of an effect on the outcome to the investor).

OCF: 0.14%
ISIN – Inc: GB00BKGR3G14
Acc: GB00BKGR3H21

BlackRock Overseas Corporate Bond Tracker Fund D Inc or Acc

This fund gives you exposure to corporate bonds worldwide and sits nicely alongside the L&G Short Dated Sterling Corporate Bond fund. It provides exposure to the global market of investment-grade corporate bonds excluding those issued in pounds. It covers all sectors and the fund is denominated in British pounds.

OCF: 0.16%
ISIN – Inc: GB00BNB74B95
Acc: GB00B58YKH53

Vanguard Global Bond Index GBP Hedged Inc or Acc

This highly diversified fund gives exposure to more than 7,300 bonds with the US, Japan, Canada, France and Germany being the highest weighted countries. Investors can use it as a ‘one-stop shop’ for developed market investment-grade-rated, fixed-income exposure. The fund is currency hedged into sterling, which takes out the currency volatility for UK investors, which we think is a good feature for a beginner.

OCF: 0.15%
ISIN – Inc: IE00B2RHVP93
Acc: IE00B50W2R13

Gold

Source Physical Gold P-ETC (SGLD)

Gold tends to make a good diversifier in a portfolio as it behaves differently to other asset classes and tends to rally while other assets are falling. This fund is an ‘exchange traded commodity’ rather than a traditional index tracker fund. However, it’s traded on the London Stock Exchange and you can buy it through most investment platforms.

Think of it like buying gold bars without the hassle of having to store your gold somewhere. The fund provides investors with the performance of the gold spot price through certificates collateralised with gold bullion. Each Gold P-ETC is a certificate, which is secured by gold bullion held in JPMorgan Chase Bank’s London vaults.

OCF: 0.29%
ISIN: IE00B579F325

 

HOW DO I PUT THESE TRACKER FUNDS TOGETHER?

Published: 14 July 2016
Last updated: 05 July 2017

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