ISAs have been hitting the headlines lately.
Following the big news in Rachel Reeves’ 2025 Autumn Budget that the Cash ISA allowance would be cut from £20,000 to £12,000 for under-65s from April 2027, rumours recently started circulating about potential new rules on interest from cash in Stocks and Shares ISAs.
Reports highlighted that the chancellor is considering bringing in a new rule that would see investors pay a 22% tax charge on interest earned from cash inside a Stocks and Shares ISA.
Why? Well the government’s intentions seem clear — it wants Britain to invest, not just save.
However, there are still lots of unanswered questions, like what it could mean for cash-like investments like Overnight Rate ETFs, and rumours of a potential ‘token stock holding’ workaround. Many have also highlighted just how difficult it would be to incorporate these rules and police them.
Rachel Reeves to tax cash in Stocks and Shares ISAs? What you need to know
What do investors make of it all?
We asked LinkedIn users what a potential 22% ISA cash tax could mean to them.
Here’s what they said.
It’s important to note that nothing has been confirmed yet. And for lots of ISA investors, this is just noise for now. Many are still going about their investing business as usual and making the most of their new £20,000 ISA allowance for the 2026/27 tax year.
Here are the 10 most popular exchange-traded funds (ETFs) InvestEngine investors have bought in their InvestEngine Stocks and Shares ISA in May 2026.
Most popular ETFs UK investors are buying in a Stocks and Shares ISA in May 2026
This list has been calculated by most bought (by number of net trades) in May 2026.
1. Vanguard S&P 500
This ETF aims to replicate the performance of the S&P 500 index, offering investors diversified exposure to the 500 largest companies in the United States.
This ETF could help investors get access to the US stock market, where it could benefit from the overall growth and success of these companies, without having to invest in each one individually.
2. Vanguard FTSE All-World
This ETF invests in a broad range of companies across both developed and emerging markets worldwide. It includes a variety of large and mid-sized firms from numerous sectors, such as technology, healthcare, finance, and consumer goods.
By tracking a specific index, this ETF aims to reflect the overall performance of global stock markets, encompassing companies from regions including North America, Europe, and Asia.
This ETF could help diversify a portfolio by offering exposure to global markets, including both developed and emerging economies.
3. Invesco FTSE All-World
This ETF offers investors the opportunity to invest in a wide range of companies from across the globe, including both developed and emerging markets. It aims to mirror the performance of the FTSE All-World index, providing diversified exposure to the world’s stock markets.
By investing across different countries and sectors, this ETF could help offer a lower risk way to benefit from broad global market growth.
4. iShares Physical Gold
iShares Physical Gold is an exchange-traded commodity (ETC) that gives investors a way to invest in physical gold by following the daily price of gold. It does this by owning gold bars.
This ETC might appeal to investors looking to include gold in their portfolio, without needing to hold it physically. Remember though, investing in a specialist area like this adds risk, so it should only form a small part of a well-diversified portfolio.
5. Vanguard FTSE Emerging Markets
The Vanguard FTSE Emerging Markets ETF invests in a wide range of large and mid-sized companies in emerging markets across the globe.
Emerging markets are economies that are in the process of rapid growth and industrialisation, often offering higher growth potential compared to developed markets. The fund provides exposure to a diverse array of industries and countries, including China, India, Brazil, and South Africa, giving investors the opportunity to benefit from the economic expansion in these regions.
This ETF could appeal to investors looking to diversify their portfolios with long-term growth opportunities and are comfortable with the higher risks that come with investing in emerging markets.
6. Vanguard FTSE Developed World
The Vanguard FTSE Developed World ETF invests in a broad selection of companies from developed markets around the world, providing exposure to a diverse range of industries and regions. It tracks an index that includes large and mid-sized companies across North America, Europe, and the Asia-Pacific region.
This ETF might appeal to investors looking for global diversification through a single investment, allowing them to gain exposure to well-established companies in developed economies.
7. iShares FTSE 100
The iShares FTSE 100 ETF aims to track the performance of the FTSE 100 index, which is made up of the 100 largest publicly-traded companies in the UK.
It might appeal to investors looking for exposure to a broad range of leading UK companies across different industries.
8. Amundi Smart Overnight Return GBP Hedged
This ETF aims to achieve short-term returns higher than the benchmark rate SONIA with extremely low volatility. SONIA stands for ‘Sterling Overnight Index Average’, and is the average interest rate banks lend money to each other overnight.
The ETF can help offer a ‘safer’ place to keep money, compared to investing directly in the stock market, with the possibility of a little more growth than a more traditional savings account might offer.
9. iShares MSCI World Small Cap
The iShares MSCI World Small Cap allows investors to gain exposure to smaller companies from around the world.
Smaller companies have the potential to grow faster than larger ones, but are also riskier as their performance can be more volatile.
10. Vanguard Global Aggregate Bond
This ETF invests in a diversified portfolio of global bonds, including government and corporate bonds. The fund aims to track an index that represents the performance of investment‑grade bonds from around the world.
The bonds included in the portfolio have different maturities and come from various regions, offering broad exposure to the global bond market.
This ETF may appeal to investors looking for a globally diversified bond investment while helping to reduce the risk that comes with investing in other currencies.
What to consider before buying an ETF
When comparing ETFs, it’s worth digging a little deeper than recent returns.
Start by looking at what the fund actually tracks. A global index like the FTSE All-World spreads your money across thousands of companies, while something more focused, like the S&P 500, tilts heavily toward the US and big tech names. Knowing the index helps you understand where your money is really going.
Costs matter too. Most ETFs are already low cost, but even a small difference in fees can add up over time, especially if you’re investing regularly. Larger funds also tend to trade more smoothly, which can save you money when buying or selling.
Finally, think about how the ETF fits into your wider portfolio. Is it a core holding you plan to build around, or a focused addition that targets a theme like gold or fixed income? Getting that mix right can make a big difference to how your portfolio performs and how comfortable you feel holding it through market ups and downs.
For more information on each ETF, check out its factsheet where you can also find its Key Investor Information Document.
What are the risks of buying ETFs?
ETFs make investing simple, but they still come with risk. Markets move, and prices can fall just as easily as they rise. Even broad funds can drop in value during periods of uncertainty.
Some ETFs are concentrated in certain regions or sectors, which can amplify both gains and losses. Diversification helps smooth the ride, but it can’t remove risk completely. Currency movements can also affect returns on international funds, even when the underlying companies are performing well.
The key is to understand your goals and what you own and why. Short-term market moves then become less stressful and your investing decisions more consistent — which is often what matters most in the end.
How to buy ETFs easily with InvestEngine
InvestEngine makes it straightforward to invest in top ETFs, whether you’re building a long-term portfolio or adding a few new funds for diversification.
Why use InvestEngine?
✅ No trading or platform fees
Buy and sell ETFs commission free, so more of your money stays invested and working for you (ETF costs apply).
✅ Powerful portfolio tools
Track your holdings, compare ETFs, and rebalance whenever you need — all in one simple dashboard.
✅ Automate your investing
Set up a Savings Plan to invest regularly, choosing how much and how often. It’s an easy way to stay consistent and build wealth over time.
✅ Flexible account options
Invest through an ISA, SIPP, general investment account, or business account — all with no platform fees on DIY portfolios.
Important information
Capital at risk. The value of your investments may go down as well as up, and you may get back less than you invest. Past performance is not indicative of future performance.
ETF costs apply. Remember, ISA and tax rules can change and any benefits depend on individual circumstances. If in doubt, you may wish to consult a professional adviser for guidance.