The Lemon Fool

Hi,
Am in a bit of a tricky position in that I would like to reduce equity exposure and am considering Vanguard UK Gilts (VGOV) and / or Vanguard Global Bonds (VAGP). I imagine that with VAGP I am adding currency risk but am not ubduly concerned about that. Other than currency, are there any other factors that might persuade me to opt for one over the other, or should I just go 50/50 and buy both?

Thank you for any comments.
Monty

VAGP is hedged.

More info can be found on Vanguard's "Pro" website than available on the "punters" one.

https://www.vanguard.co.uk/professional/product/etf/bond/9442/global-aggregate-bond-ucits-etf-gbp-hedged-distributing

Hi Monty.

Instinctively, I think single country is more risky that global, so I would prefer VAGP to VGOV. Also, I think VAGP has investment grade corporates, whereas VGOV does not (but please verify).

If you look at the bottom of this post, you will see some tangentially related discussion

https://www.lemonfool.co.uk/viewtopic.php?f=52&t=40910

but to summarise, if I were starting blue sky with bond ETF's, I might go

AGBP: 54% (Passive Developed Global Investment Grade Bonds - analogous to VAGP)
GHYG: 27% (Passive Developed Global High Yield Bonds)
EMHG: 19% (Passive Emerging Global Bonds)

Indeed, I may shortly do this for the bond component of our ISA's.

Regards, Newroad

Hedging costs money and shows up in the transaction costs for VAGP. The OCF is also higher than for VGOV. I am inclined to think that Lars Kroijer was right and go for VGOV rather than VAGP.