The Vanguard effect? HSBC slashes fees

HSBC cuts tracker fees sharply on funds for UK investors.

Christopher J. Traulsen, CFA 29 June, 2009 | 1:46PM
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HSBC announced this morning that it has cut the fees of its index funds sharply. That's extremely good news, and in our view shows that a bit of healthy competition--in this case from Vanguard's recent entry into the UK market--can greatly benefit investors. Vanguard launched its suite of trackers for UK investors on 23 June, with projected TERs ranging from 0.15% to 0.55%. The prices are stunningly low for the UK market.

Vanguard vs HSBC
HSBC says it will cut the management fees on seven trackers to just 25 basis points, with projected TERs ranging from a low of 0.27% to a high of 0.37%. The key differen

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About Author

Christopher J. Traulsen, CFA  is director of fund research, Europe and Asia, Morningstar.