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Tracking FTSE 100, 250 & All-Share Indexes

HSBC has index funds tracking the FTSE 100, 250 & All-Share Indexes all with total expense ratios of about 0.25%. Is it a good idea to track all these indexes or only one or two - what are the pros and cons of tracking them all.


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The 100 is the top 100 companies. The 250 is the next 250 companies. Any references to 350 is combination of the 100 & 250. The All-share naturally covers the whole market. The proportions are all based on the market capitalisations of the companies. Having all 3 would see substantial overlap because the top 350 are much bigger than the rest The problem with the 100 & 250 trackers is that every 3 months there is a movement of the constituents. This results in forced selling (at a discount) of companies leaving the index and forced buying (at a premium) of those joining. The discount & premium are because all those trackers are doing it at the same time. Some saving can result where investment houses have both 100 & 250 trackers and can transfer some shares between trackers. With the All-share index trackers, there is no forced sale or purchase. The top 350 companies would be most of the index anyway, so I would go for the All-share on its own. Mike