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1st
Mar 2021
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Cheapest ETF Funds For Your ISA

Cheapest ETF Funds For Your ISA

In this article we look at some of the cheapest ways to access markets across the globe using your 2020-21 and 2021-22 allowance.

Exchange traded funds (ETFs) are a great way of investing in funds at low cost. 

Below is a summary of some of the cheapest ETFs in the market which you can invest on a monthly basis from £25pm or via a lump sum in an ISA.

UK

The FTSE 100 is a good place to start with the largest companies by capitalisation featuring in the index including companies such as AstraZeneca, Unilever and Barclays.

2 low cost funds that track the FTSE 100 are the  iShares Core FTSE 100 ETF (LSE: CUKX) and the HSBC FTSE 100 ETF (LSE:HUKX). Both have a super low ongoing charge of 0.07%.

Another low cost ETF tracker to consider is from Legal & General. The  L&G UK Equity ETF (LSE: LGUK) tracks the Solative Core UK large and mid cap index composed of 104 companies. The fund ongoing charge is a very low 0.05%.

Europe

A very low cost way to get exposure to European companies is through  HSBC EURO STOXX 50 ETF (LSE:H50E) and Invesco EURO STOXX 50 ETF (LSE:SX5S) both with low ongoing charges of 0.05%. Both funds provide access to the largest 50 companies from 11 countries in the Eurozone.

USA

Moving across the pond if you are looking to invest in the US market then  Invesco MSCI USA ETF (LSE: MXUS) and Invesco S&P 500 ETF (LSE: SPXP) both offer investors access to the S&P 500 and the MSCI USA index at a very low ongoing charge of 0.05%.

China

You can access the second largest economy through  Franklin FTSE China UCITS ETF (LSE:FRCH) which tracks the FTSE China 30/18 Capped Index which comprises 872 Chinese firms. The fund has an ongoing charge of 0.19%. Another option for investing in China is via the Lyxor MSCI China ETF (LSE:LCCN) which tracks the MSCI China Index and has an ongoing charge of 0.29%.

Asia-Pacific Region

To gain exposure across the Asia Pacific zone then a low cost option is via  L&G Asia Pacific ex Japan Equity ETF (LSE:LGAP) which tracks the Solactive Core Developed Markets Pacific ex Japan Large and Mid Cap index, with over 50% exposure to Australian companies followed by Hong Kong with 20% exposure. The fund has an ongoing charge of 0.11%.

Japan

The  Xtrackers Nikkei 225 ETF (LSE:XDJP) is a cheap way of accessing the Japanese market tracking stocks from top performing blue chip companies based in Japan. The fund has an ongoing charge of 0.09%. Another option for investors is the L&G Japan Equity ETF (LSE:LGJP) which tracks the Solactive Core Japan Large & Mid Cap Index and has an ongoing charge of 0.10%.

Emerging Markets

To access emerging markets you will typically pay a bit more on an ongoing basis.  HSBC MSCI Emerging Markets ETF GBP (LSE:HMEF) tracks around 1400 large and mid cap companies and offers investors good value with an ongoing charge of 0.15%. Another fund to consider is the iShares Core MSCI EM IMI ETF (LSE:EIMI) tracking the MSCI Emerging Markets Investable Market Index and tracks over 3,000 companies including smaller stocks.

Global

If you are looking for global exposure then  SPDR MSCI World ETF (LSE:SWRD) is worth a closer look. The fund tracks the MSCI World Index which is comprised of approximately 1,500 companies across 23 developed markets and you can access at a low ongoing charge of 0.12%.

For a global fund that has exposure to emerging markets, then the  Vanguard FTSE ALL-World UCITS ETF (LSE: VWRD) is worth considering with an ongoing charge of 0.22%.

ETF Investment via an ISA

An investment or stocks and shares ISA as they are often called is a "tax wrapper" that allows you to invest in different types of investments e.g. funds to individual shares to help you save any profits you make from tax.

If you are investing in a ETF fund and you have not used your current annual allowance which is currently £20,000 (For the 2020-21 and 2021-22 tax years) then it makes sense to benefit from this tax free wrapper.

For more on ETF ISAs click here

As with all investing you need to be comfortable that the value of your investment migh go down as well as up.

Investment Fund Supermarket ISAs

Stocks & Shares ISA

from Fidelity

ISA Option
Allows ISA Transfers
Regular Savings
  • Protection Scheme: FSCS
  • Fund Choice: Choose from over 4,000 investment options, including one of the widest fund ranges in the UK, plus shares, investment trusts and exchange-traded funds. There’s also expert guidance to help with your investment decisions, which includes a selection of tools and insights from Fidelity’s experts. Capital at risk. Tax and ISA rules apply.
  • Invest From: £25 through regular savings or £1,000 lump sum

Why we like it: Fidelity has lots of investment options, plus an extensive range of guidance tools to help you decide what to invest in. Their award-winning ISA is easy to start and offers great value, their a typical service fee of just 0.35%. Other ongoing charges apply. On top of that, everything is backed by Fidelity’s 50 years of investment experience.

Important: The value of investments can go down as well as up so you may get back less than you invest. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.

Tax treatment depends on individual circumstances and all tax rules may change in the future.

Stocks & Shares ISA 2021-22

from Interactive Investor

ISA Option
Allows ISA Transfers
Regular Savings
  • Protection Scheme: FSCS
  • Fund Choice: Access 40,000+ UK, US and international shares on 17 global exchanges. Choose from over 3,000 funds or select a ready made portfolio. Option to invest in 6 low cost funds selected by experts.Capital at risk.Tax and ISA rules apply
  • Invest From: £25 a month or any lump sum

Why we like it: An award-winning ISA that gives you complete control. The second largest platform in the UK with the widest choice of investment options in the market including funds, investment trusts, ETF’s and more. Strong ethical investment proposition with more than 140 investment options. Open online in less than 10 minutes. Access to expert independent ideas and analysis. Low cost fees and trading.

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Stocks & Shares ISA 2021-22

from Hargreaves Lansdown

Allows ISA Transfers
  • Protection Scheme: FSCS
  • Fund Choice: Choose from over 2,500 funds, shares, investment trusts and more to build your portfolio. Let HL know your goals and risk appetite and they will show you a ready-made portfolio that matches. Capital at risk. Tax and ISA rules apply.
  • Invest From: £25 pm

Why we like it: Choose your own funds or alternatively a ready made portfolio. Market-beating savings and discounts of up to 5.5%. No charge to buy and sell funds. Low, tiered annual charges for holding funds, with a maximum of just 0.45% per annum. Free fund updates and analysis from experienced research team. Invest with a financially secure, FTSE 100 company.

Offer:

Cashback » available now when you transfer (Terms Apply)

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Model Portfolio ISA

from AJ Bell

Allows ISA Transfers
  • Protection Scheme: FSCS
  • Fund Choice: Choose the fund that suits you. There are eight in total, each built by our specialist team at AJ Bell Investments.
  • Invest From: £25 pm

Why we like it: The ‘no-hassle’ option – just choose your fund and how much to invest. That’s it. They do everything else from there, including managing and rebalancing the fund whenever they think it’s necessary.

Important: The value of your investments can rise as well as fall. You may get back less than you invested. If you’re unsure, we recommend you ask for independent advice.

Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

High Income ISAs

High income ISA ideas:

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Cash ISAs

Fixed Rate & Instant Access ISAs:

Cash ISAs: 

Stocks & Shares ISAs

Types of Stocks and Shares ISA include: 

Stocks and Shares ISAs

Latest News

5 Considerations for Your Next Investment ISA

15th March 2021

You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

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