Questions About Vanguard Index Fund

[fahdmirza]

Hello,

I am almost ready to invest in one of Vanguard Australia Diversified Index Fund. Would you please kindly advise which index fund would suit me more based on following facts :

-- I am 40 years old and would make initial investment of $25000
-- I would then make monthly payments ranging from $500 to $1000
-- I am looking to keep this fund for 15years+
-- I will put it on dividend reinvestment plan
-- I don't want to take much risk but at the same time want to see my money working decently hard.

Question 1: Could you please kindly advise out of these two which fund suits me more? / Or what would you do if you were in my shoes?

Vanguard Balanced Index Fund or Vanguard Growth Index Fund

Question 2: I am not trying to time the market but just as a question if I make early payment when market is down would I get more shares or is it the same whether market is high or down?

Question 3: There are corresponding Vanguard ETF funds to these index funds. The reason I am not going ETF road is that then monthly I would have to pay brokerage fee, whereas with index fund direct with Vanguard, I would save that. Am I right in this assumption?
regards,

Thanks.

 

[greggles]

1. There doesn't seem to be too much difference between them in terms of returns. They've both been doing pretty well in the last few years. Just select the one that sounds like it better suits your risk profile.



2. If the market is down, how do you know it won't go down further? Best not to worry about where the market is if you've decided to invest in a diversified index fund. Over time it will trend up unless there is a global economic catastrophe.

3. If you plan on making monthly contributions then you are probably better off with the unlisted fund rather than the listed ETF for reason you mentioned (i.e. brokerage costs).

Please note: those are just my relatively uneducated opinions and do not constitute financial advice.

 

[Darc Knight]

1. I'd be looking at the Growth fund due to your time frame. Vanguard Balanced fund has 50 percent fixed interest and cash and 50 growth assets whereas Growth fund has 70 percent growth assets (shares and property) which tend to out perform cash and fixed interest.
But with a 15 year timeframe you will catch the next major downturn but also it's recovery and additional growth.

But you need to seek professional advice.

2. From memory you buy units in these funds, but email Vanguard yourself

3. Email Vanguard again for clarification.

But seek professional financial advise as the above is not meant to be a substitute for that.

 

[sptrawler]

You could also look at LIC's with dividend reinvestment.

 

[Rafmed]

Hello,

I am almost ready to invest in one of Vanguard Australia Diversified Index Fund. Would you please kindly advise which index fund would suit me more based on following facts :

-- I am 40 years old and would make initial investment of $25000
-- I would then make monthly payments ranging from $500 to $1000
-- I am looking to keep this fund for 15years+
-- I will put it on dividend reinvestment plan
-- I don't want to take much risk but at the same time want to see my money working decently hard.

Question 1: Could you please kindly advise out of these two which fund suits me more? / Or what would you do if you were in my shoes?

Vanguard Balanced Index Fund or Vanguard Growth Index Fund

Question 2: I am not trying to time the market but just as a question if I make early payment when market is down would I get more shares or is it the same whether market is high or down?

Question 3: There are corresponding Vanguard ETF funds to these index funds. The reason I am not going ETF road is that then monthly I would have to pay brokerage fee, whereas with index fund direct with Vanguard, I would save that. Am I right in this assumption?
regards,

Thanks.

Hello,

I am almost ready to invest in one of Vanguard Australia Diversified Index Fund. Would you please kindly advise which index fund would suit me more based on following facts :

-- I am 40 years old and would make initial investment of $25000
-- I would then make monthly payments ranging from $500 to $1000
-- I am looking to keep this fund for 15years+
-- I will put it on dividend reinvestment plan
-- I don't want to take much risk but at the same time want to see my money working decently hard.

Question 1: Could you please kindly advise out of these two which fund suits me more? / Or what would you do if you were in my shoes?

Vanguard Balanced Index Fund or Vanguard Growth Index Fund

Question 2: I am not trying to time the market but just as a question if I make early payment when market is down would I get more shares or is it the same whether market is high or down?

Question 3: There are corresponding Vanguard ETF funds to these index funds. The reason I am not going ETF road is that then monthly I would have to pay brokerage fee, whereas with index fund direct with Vanguard, I would save that. Am I right in this assumption?
regards,

Thanks.

ETF VTI save you on fees hold for 10 + years. A good idea would be to reinvest the dividends if you can.