I just noticed the difference in spread between these. 4.5bps vs 18bps as of today. I’m tempted to rethink which one I buy from now on!!!
Normally I would go with the Accumulation version, but not sure how long you would need to hold it to benefit in the auto reinvestment to beat the spread. Thoughts?
Even if you were not to reinvest the yield (1.6%) for a whole year and your return is about 7%, I calculate that there would only be about 11bps [0.016 * 0.07 * 10000] difference in profit on the whole investment before taking into account the spread. So to me VWRL is the clear winner in this case. Nearly always in similar comparisons, I think the spread is the most important factor in deciding.
Yeah, I concluded the same and default to the distributing ones due to the greater liquidity and tighter spread. This difference is even more pronounced for the less popular ETFs.
There has to be a reason Vanguard doesn’t offer any accumulating ETFs on its own UK platform and this is my best guess as to why.
Unfortunately, VG doesn’t list the total costs of its accumulating ETFs on its website. I wouldn’t be surprised if other ‘hidden’ costs – such as transaction costs – are higher for accumulating ETFs.