The UK based investor here.

I haven't found anything under "Multiple index funds" search criteria thus decided to give it a go, if there is already a similar question/answer would love to get a link.

I am planning to invest in index funds, I have my eye on the cheapest options possible. This is the list I assembled having a very limited knowledge and no practical experience with investing.

Can anyone with practical experience, tell me if it makes sense to invest straight away in 4 different index funds, or shall I start with one index first?

The first two look more stable, the last two yield quite extraordinary returns, I think and seem a bit riskier.

It's going to be ISA wrapped, and my plan is to load £4000 at first keeping the 40% 40% 10% 10% ratio and add £1000 every month.

Are there any red flags in my thinking, am I too optimistic or maybe the other way around?

I am 35 years old man with no commitments at the moment and planning to invest for retirement.

Thanks in advance!

  • "planning to invest for retirement" - any reason that for two of them you've linked to the Income units rather than the Accumulation units?
    – AakashM
    Commented Jul 3, 2018 at 13:23
  • You might want to look at the research on how actively managed Investment Trusts beat funds and OEIC's - trackers have their own problems especially at the end of a bull market. Commented Jul 3, 2018 at 21:22
  • @AakashM thanks for pointing that out, I switched funds to Acc, hope it won't cost me a fortune :)
    – matewilk
    Commented Jul 10, 2018 at 13:07
  • @Neuromancer can you give me a source of the information? Also, are we at the end of a bull market?
    – matewilk
    Commented Jul 10, 2018 at 13:07
  • @matewilk citywire.co.uk/investment-trust-insider/news/… Also markets are looking expensive all over and you cant know what mr trump might do or the idiots in charge of brexit Commented Jul 10, 2018 at 22:23

1 Answer 1


This looks fine, and depending on your exact risk profile is probably pretty close to optimal for someone of your age and aims. You should just jump in and buy them in their relevant percentages from the start if buying funds in an ISA as there are no trading costs and this should be above the minimum unit purchase size depending on the exact platform you intend to use.

I'd only add that it's critical in the UK investing landscape to keep reviewing which broker you are using as your investment grows. At your sums Fidelity is fine, but as it grows you will hit a point where the platform fees become a steady drain and you are better switching to a cheaper platform fee for these same index funds, or if you get really high, a discount broker and ETFs where you will pay no ongoing % of sum platform fee, just the ETF fund fee (same as you do with these indexes) and a minor trading cost when you buy and sell.

It's also worth noting that the ETF option becomes a huge drain on you if making constant small monthly purchases: that is a route for when you have your full ISA allowance already available and can just lump sum the whole lot into an ETF in one transaction (eg 1x£20,000 ETF purchase a year with 1x£5.95 charge has a radically different cost that 12x£1650 a year with 12x£5.95 charges. You obviously don't face this problem with funds which are typically free to trade - you just have to pay the platform an ongoing fee instead.

It's also worth finally adding that the reason the emerging markets and small cap having higher fees isn't trickery from Vanguard, it's just that trading these types of less liquid/hard to access shares carries higher costs that have to be passed on. Even with these costs they are an important part of a portfolio like this in terms of spreading risk and getting maximum global exposure and worth sticking with.

  • Thanks for the response, I'm planning to top up the funds every month to minimise risk. Having read some investing books, it makes sense to invest monthly to avoid big hit in case of a market crash. I could top it up with full ISA allowance straight away, but it doesn't seem to be a reasonable, plus as you've said, in case of index funds I don't pay for transactions.
    – matewilk
    Commented Jul 3, 2018 at 10:39
  • One more thing, I am using Fidelity platform via Cavendish Online and they have a slightly lower fees of 0.25% ongoing + funds fees on top of that as compared to 0.35% for Fidelity + funds fees.
    – matewilk
    Commented Jul 3, 2018 at 10:46
  • Yep Cavendish looks the best of the bunch at that price point, and putting money in slowly also is a much less stressful way of investing at first (obviously once you have a large ISA the 20k each year starts to become less and less as a % of the total and lump summing it becomes much less worrying). Well done on doing your research properly before getting in!
    – Philip
    Commented Jul 3, 2018 at 13:00

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