Adelphi Financial Brokers, in association with iCubed, have developed a range of five sample model portfolios using Index Funds managed by Vanguard.

These portfolios offer low cost exposure to global equity and bond markets.

The highlights of the portfolio service are:

  • Globally diversified in equities and bonds – helping to reduce your risk
  • Each Portfolio created with 6,000 to around 20,000 underlying holdings
  • Tax Efficient – All underlying funds under the one tax umbrella
  • Fully transparent charging structure
  • Ongoing Chares Figure [OCF]  below 12-14bps for a portfolio
  • No rebalancing charge – fixed strategic asset allocation
  • No trading fees
  • EUR denominated funds

Each portfolio offers a different blend of shares and bonds – made up of Vanguard index funds.

Key benefits of an Indexing approach:

  • One stop shop: you can access entire markets with one investment, giving you a quick and easy way to implement your investment strategy.
  • Diversification: Index funds often hold hundreds or even thousands of shares or bonds, meaning you are less exposed if one of the holdings performs poorly.
  • Low research overheads: They’re not trying to beat the market, so they don’t have to pay lots of researchers to analyse companies. This means they can offer the funds at low cost, helping you to keep more of your returns.
  • Economies of scale: Because investors’ money is pooled together before investing, lower dealing fees are paid which are passed on as savings to you.

Key risks of Indexing:

  • The aim of index funds is to track the performance a given index. They will do this if the index is going up or going down, so you might get back less than you invested.
  • Index funds don’t position themselves to beat the market – if you favour this approach, an active fund might be more appropriate for you.
  • Index funds invest in a variety of market that carry specific risks including currency risk from investing overseas, or risk of investing in emerging markets, smaller companies or derivative usage.