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Younger investors drive growth in tracker funds, say Hargreaves Lansdown

Wednesday 2nd July 2014

New figures from Bristol-based financial services firm Hargreaves Lansdown show growth in tracker funds is increasingly being driven by younger investors.
According to research, more than 1 in every 6 thirty year olds holds at least one passive investment in their portfolio, compared to the overall average of 1 in 9
What’s more, 57% of new tracker fund purchases were made by investors under 45 years old, as tracker fund assets have grown nearly 50% over the last year.
Explaining the benefits of tracker funds, Adam Laird, Passive Investment Manager said: “Tracker funds are low cost, straightforward investments. Their simplicity appeals to younger investors who may be starting to build an investment portfolio. Costs have been falling and investors can now access all major bond and equity sectors for under 0.25% ongoing charge.”
“Charges are not the only consideration when choosing a tracker fund. There are dozens of options available and it is important to balance quality with cost. Investors should also consider how the fund replicates its index and whether they lend stock, to gauge risk and how closely it will track its chosen index,” he concluded.

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