Global Equity (World)

Where the money actually sits

The category holds 55 funds and 2114.2B in combined assets, and those assets are not spread evenly. Vanguard Total International Stock ETF (VXUS), run by Vanguard, holds 649.3B on its own, and the three largest, Vanguard Total International Stock ETF (VXUS), Vanguard FTSE Developed Markets ETF (VEA) and iShares Core MSCI EAFE ETF (IEFA), account for 54.5 % of the total. At the other end, SPDR MSCI ACWI UCITS ETF (SPYY) manages only 9M. Size is no guarantee of quality, but it decides two very concrete things: the spread between buying and selling price you pay on every order, and the odds that the fund still exists in ten years.

The fee gap, in money

Ongoing charges run from 0.05 % for Vanguard FTSE Developed Markets ETF (VEA) to 0.50 % for iShares MSCI Canada ETF (EWC), a gap of 0.45 points, against a category average of 0.24 %. On £10,000 held for ten years that gap is roughly 450 in extra charges, before counting the return that money would itself have earned. It is the one variable in the comparison known in advance: past performance does not repeat, fees repeat every year.

Two funds in one category do not hold the same basket

The 55 funds listed track 37 different indices, among them FTSE Global All Cap ex US, FTSE Developed All Cap ex US, MSCI EAFE Investable Market and MSCI World. The largest tracks FTSE Global All Cap ex US. That spread is why two funds filed under the same theme can differ by several points over a year: they hold different securities, weight them differently and rebalance on different dates. Each fund page names its index, and that is where a serious comparison starts.

Replication and domicile

50 funds hold the constituents of their index directly, 5 use a swap, including Xtrackers MSCI World Swap UCITS ETF 1C (XMWO) from Xtrackers. Synthetic replication often tracks more closely and reaches markets that are hard to hold directly, at the price of a counterparty risk that is regulated but real. Physical replication is easier to understand and allows securities lending, which earns the fund income and adds its own risk.

36 of the 55 funds are domiciled in IE, the rest in US, LU and FR. Domicile sets the withholding tax the fund itself suffers on the dividends it receives, a cost absent from the stated fee but present in the return, and it also sets your own tax treatment depending on where you live.

Accumulate or take the income

35 funds accumulate dividends, 20 pay them out. The largest accumulating share class is iShares Core MSCI World UCITS ETF USD (Acc) (IWDA), the largest distributing one Vanguard Total International Stock ETF (VXUS). The choice is not about yield, both versions of the same index return the same before tax, but about tax and discipline: the accumulating class reinvests with no cost and no decision, the distributing class pays income that is taxable in the year it arrives.

Age and critical size

The oldest fund in the category, iShares MSCI Canada ETF (EWC), launched on 1996-03-12, giving 30 years of history, and the newest, Amundi MSCI World UCITS ETF EUR Acc (MWRD), on 2024-03-06. A long record shows how the fund behaved in a fall, which no one-year number can. A fund launched two years ago has lived through a single market regime.

1 of the 55 funds manage under 100 million, among them SPDR MSCI ACWI UCITS ETF (SPYY). Below that level a fund rarely pays for its issuer, and a closure forces a sale on the issuer's timetable rather than yours, with capital gains tax along the way.