Fund changes giving you greater choice and lower fees

The Moneybox elves are going to be busy over the Christmas break making some changes to the app.

In the latest release you’ll see more fund choices – a corporate and a government bond fund, a lower-cost alternative for global shares, and a new cash fund. This is part of a series of fund changes designed to give you greater choice and lower fees.

What are the new funds?

Global shares

You can transfer your global shares to the Fidelity Index World Fund from the Vanguard LifeStrategy 100% Equity Fund, or stay as you are. Both the funds are designed to track the MSCI World Index, however, the new Fidelity fund offers you 45% lower fees than Vanguard fund.

If you invest in the Fidelity fund you’ll track the global stock market with shares in over 1,600 companies across more than 20 countries. You probably interact with many of these companies every day; like Amazon, Facebook and Netflix.

Corporate and government bond funds

You can now balance your portfolio with bonds which are generally a lower risk and lower return option than shares. Big companies and governments borrow money from people like you, and you get interest and the loan repaid, like an IOU. 

The underlying fund for the corporate bonds is called Blackrock iShares Overseas Corporate Bond Index Fund (UK) and the underlying fund for the government bonds is Blackrock iShares Overseas Government Bond Index Fund (UK).

Cash fund

The Henderson Cash Fund which makes up the cash part of your investment is closing. In its place will be a very similar, lower-cost cash fund from Legal & General.* The Legal & General Cash Trust Fund deposits most of your money with the banks and financial institutions offering the most competitive interest rates at the time. The good news is that your fund
management charge will reduce from 0.24% to 0.15%.

On 14 January, your units in the Henderson Cash Fund will be sold and we will promptly buy the same value of new units in the Legal & General Cash Fund.

How do I change?

If you wish to invest in these new funds you will need to change your allocation. You can do this by going to ‘Settings’->‘Allocations’ and either selecting a new starting option or by choosing a custom allocation.

You will be able to update your allocation for new investments to include these funds from the latest version of the app (vs 5.8). Please note that the option to rebalance ‘All’ of your current holdings will be disabled from 21 December until 17 January.