Specific Funds I Include in My Portfolios
I have gone through something like 15,000 funds to find the ones that meet my rather exacting demands. Yes, it took blooming ages to achieve.
Only around 100 made it onto my list. I like these funds because they are Cheap, backed by large companies and focused on the asset classes I want.
On this page:
- Low Cost (10 times cheaper than most active funds)
- Backed by large investment companies
- Focused on the asset classes that I want to invest in
Click here to jump to see examples of funds that passed my tests shown further down this page.
Cheap
The cost of a fund is measured by what’s known as the Ongoing Charge Fee or OCF. This is the percentage of your investment that the fund manager takes.
For example, if you have £1,000 invested in a fund and it’s OCF is 0.90% (the average fee charged by active fund managers – the ones that you’re most likely to hear from) then you’d pay £9 for holding that fund for a year. That’s really expensive and the performance tends to be awful.
The funds I like have much, much lower OCFs starting at 0.05% a year i.e., just 50p as opposed to £9. The portfolios I show you on this website have an overall OCF (or “weighted” OCF if you prefer) of no more than 0.09%. That’s ten times cheaper than the average active fund manager that you’re likely to encounter through your bank or a well-known investment company.
This is hugely significant because you’ll be lucky to see your investments grow by 4% a year. And they won’t grow every year but you will be charged fees every year.
I want to keep as much of that growth as possible. With my funds, I keep almost all of any growth that I might make. With active funds, I’d lose a massive chunk of any growth or suffer an even bigger loss when values fall (which they will from time to time).
What’s more, as I explain in the book, active funds deliver awful performance. The more you pay in fees, the worse the performance tends to be!
Backed by large investment companies
This is important to me because I want those investment companies to stay in business. If they were to go out of business, I’d risk losing my money or having to go through the process of recovering my money through the government-backed Financial Services Compensation Scheme.
I don’t want the risk or the hassle of either of those outcomes.
Focused on the asset classes that I want to invest in
I want funds that allow me to create a mix of investments (portfolio) that copies the portfolio that I think is right for me in terms of the level of risk and the amount of money I have available to invest.
An asset class might be, say, UK company shares. So I want a fund that is invested in the shares of as many UK companies as possible. A fund that more or less copies the FTSE All Share Index will do that for me. It’s not going to copy the overall performance of those companies’ shares precisely, but it’s plenty good enough for my purposes.
Examples of specific funds that passed my tests
The table below contains examples of the 110 funds I include in the book. Choosing which funds to include in my portfolio and how much to buy of each would depend on how much money I have available to invest, and what level of risk is appropriate for me.
I include these examples so that you can see it really is possible to build a portfolio that has an exceptionally low annual fund management fee or “Ongoing Charges Figure” (OCF).
I’m not including the full list here because it took me weeks to research and compile it. And that was after the weeks I’d spent researching the risk-rated portfolios of big banks and investment houses to find out what funds I would need. The complete list is in the book which is £14.93 to buy.
| Asset Class | Fund | OCF |
| Short-term Bonds | L&G UK Gilt 0-5 Year UCITS EFT | 0.06% |
| Global Shares | Amundi Index Solutions – Amundi Prime Global UCITS ETF DR | 0.05% |
| Alternatives | iShares Developed Real Estate Index Fund (IE) Class D GBP | 0.17% |
| Gold (if you’re determined to buy it) | iShares Physical Gold ETC (SGLN) | 0.12% |
I include 110 in the book to make it possible to build the portfolios on as many platforms as possible. It also allows for second-choice funds when the cheapest one might have been removed from the platform.
The next step after this, is to determine which investment website or “Platform” I’m going to use. They vary enormously in terms of what they offer and how expensive they are. It’s essential I get that decision correct.