Prices unavailable for an ETF - should I cancel my regular investment?

[EthicsGradient]

I have for the last few months been making a regular investment, in my SIPP, in the Lyxor Core Morningstar UK NT ETF (similar to a FTSE 350 index). This morning, with the turmoil, I was taking a look at the bid-offer spread on a few ETFs, and while some spreads have doubled from last week - to be expected, I guess - a current price for the Lyxor ETF isn't even available, let alone a spread (see eg https://www.hl.co.uk/shares/shares-sear ... s-etf-dist - still showing the closing Friday price; and an attempt to get a quote for the existing holding in my SIPP gets a "phone us to get a quote" message).

My regular investment is due to happen tomorrow. I was all set to say "this is the point of regular investments - let things even out", but I now have cold feet about an order for something "in the dark" (I wonder if they'd offer me a bad price, and being 'regular', I can't really turn it down). Time to change the order for something that has a true price on it?

[GeoffF100]

I have been intending to make use of the weak markets to sell direct holdings in UK shares and buy a tracker instead, I found that VEVE currently has a spread of about 1%, I am not happy with that. Bloomberg shows the fund trading at a discount of 0.5%, so perhaps I will be OK buying. Nonetheless, I believe Bloomberg shows the premium/discount at the close of business, so I cannot rely on that. I can wait for less turbulent markets, but the opportunity may go away if I do that.

[EthicsGradient]

I have been intending to make use of the weak markets to sell direct holdings in UK shares and buy a tracker instead, I found that VEVE currently has a spread of about 1%, I am not happy with that. Bloomberg shows the fund trading at a discount of 0.5%, so perhaps I will be OK buying. Nonetheless, I believe Bloomberg shows the premium/discount at the close of business, so I cannot rely on that. I can wait for less turbulent markets, but the opportunity may go away if I do that.

This London Stock Exchange page shows offer and bid prices, which are changing during this day (it also has a tab for recent deals); I'd think that is the best information a private investor can get without signing up with a specialist firm.

https://www.londonstockexchange.com/exc ... ml?lang=en

For VEVE it currently shows 44.77 and 45.04, so about 0.6% spread.

[GeoffF100]

I have been intending to make use of the weak markets to sell direct holdings in UK shares and buy a tracker instead, I found that VEVE currently has a spread of about 1%, I am not happy with that. Bloomberg shows the fund trading at a discount of 0.5%, so perhaps I will be OK buying. Nonetheless, I believe Bloomberg shows the premium/discount at the close of business, so I cannot rely on that. I can wait for less turbulent markets, but the opportunity may go away if I do that.

This London Stock Exchange page shows offer and bid prices, which are changing during this day (it also has a tab for recent deals); I'd think that is the best information a private investor can get without signing up with a specialist firm.

https://www.londonstockexchange.com/exc ... ml?lang=en

For VEVE it currently shows 44.77 and 45.04, so about 0.6% spread.

The spread is currently showing as 0.07% on both the LSE and HL. These prices will be delayed. I can get real time prices by logging into one of my accounts. The markets appear to have settled a little, but I am still not keen on buying in huge quantity. I may just rebalance a little, and fill my CGT allowance in this tax year.

[EthicsGradient]

I eventually decided to switch my regular purchase to the Vanguard FTSE 250 ETF (which I can justify to myself on the grounds that half the money for it comes from a sale of a FTSE 250 stock last week). That has a higher trade volume and on-book deals, whereas the Lyxor Morningstar UK NT, although it is now trading (and at a reasonable spread) is all off-book trades, which makes me a little nervous.

I had already used up my CG allowance for this tax year; I was trying to work out if it was worth selling some ETFs that have just gone into losses, to bring forward the sale of a poorly-performing OEIC I'd otherwise have to do in the 2021/22 tax year. I decided the fiddling involved isn't worth the cost of the spread on the ETFs. I can do it later if the markets calm down and the spread isn't too much (even if that means making a CG tax return next year as well as this).

[GeoffF100]

You have to be careful with Lyxor, there are possible tax implications:

https://monevator.com/lyxor-core-etfs-v ... -wrinkles/

[EthicsGradient]

But as the notes to that say, their ETFs did get the needed reporting status. This is noted in their factsheets - see https://www.lyxoretf.co.uk/en/retail/re ... prospectus (as "UKFRS Yes").

[GeoffF100]

Nonetheless, the withholding tax will still be greater than for Ireland based funds in some cases.

[EthicsGradient]

The case it talks about, though, is US dividends, rather than UK. I don't think EU rules would have allowed the UK to tax dividends bound for an Irish ETF different from those bound for a Luxembourg one (and those presumably still apply, and I don't think there is yet a plan to make a difference between them - trying to pick off EU countries would have been in the news).

[GeoffF100]

The case it talks about, though, is US dividends, rather than UK. I don't think EU rules would have allowed the UK to tax dividends bound for an Irish ETF different from those bound for a Luxembourg one (and those presumably still apply, and I don't think there is yet a plan to make a difference between them - trying to pick off EU countries would have been in the news).

The UK does not charge withholding tax. The US does. The tax treaties with Ireland and Luxembourg are different. The EU has no control over that.

The EU has no taxation powers. The EU withholding tax rules concern the disclosure of income, rather than the amount of tax levied:

https://en.wikipedia.org/wiki/European_ ... olding_tax

[EthicsGradient]

The UK does not charge withholding tax.

Which is the point, in this case.

The EU has no taxation powers.

But it has powers to make member states treat each other equally, rather than favouring one over the other. So you wouldn't have expected the UK to treat Ireland and Luxembourg differently.

[GeoffF100]

The UK does not charge withholding tax.

Which is the point, in this case.

The EU has no taxation powers.

But it has powers to make member states treat each other equally, rather than favouring one over the other. So you wouldn't have expected the UK to treat Ireland and Luxembourg differently.

As far as relevant EU powers are concerned, you would have to ask an expert. I have quoted from Wikipedia. The member states certainly have plenty of tax treaties:

https://ec.europa.eu/taxation_customs/i ... -states_en

The EU is mind bogglingly complicated, and most generalisations about it are not accurate. The Single Market does have a wide variety of specific rules to ensure a level playing field for trade. Even the WTO has that too, but the rules are much less wide ranging. The WTO's "most favoured nation principle" requires that all trading partners be treated equally in many matters of trade.