Cheapest way to buy funds discussion

EdInvestor

But basically, I'd prefer to ask if there is some part of the MSE (or other) website I could check reguarly, which suggests which kind of investment would be most likely to do well at any given time? (e.g. that says, "now interest rates are rising and look to keep rising in Europe and US, so not a great time to invest in European or US bonds, better to invest in blue chip share funds" or something like this.)

I think you may be referring to a strategy known as "momentum investing" which holds that at any given time a sector or investment theme will become popular, seize the momentum and keep on going up for a time.It plays on the "herd instinct" in the market.

I know of people who have done quite well with it, indeed I occasionally do it myself with indidvidual shares if I spot an obvious runner, but I think it's really one for more experienced investors who have a good feel for the market and plenty of time to study markets fairly regularly to pick up on the trends.You can't really dip in and out once every few months and hope to get it right.

Rather you'd probably be best to chpoose a selection of funds across a few categories, so as to use diversification to reduce risk.

Funds are divided into categories and rated here:

https://www.citywire.co.uk/Funds/Home.aspx


To be quite honest though, I would be a little concerned about someone who got worried about a drop over a few months of 4%.

Shouldn't you really be in cash?

Gearoi

Can someone answer the noob questions already? This discussion is sky-rocketing between two or three people who could really help everyone else by answering the sensible questions posted above.

Thanks for your help! It'll only take a little while

dunstonh

Can someone answer the noob questions already?

What questions?

MrHackit

i have mininal experience want to buy some specific shares about £14,000 worth to put into an isa fund for me and my spouse is it possible to do this ? if so how and any recommendations regarding brokers or companies that can provide this service for me im looking at long term holding rather than short term gains

newfundinvestor

Hello Forum

I am currently looking into investing some money into OEIC/UTs funds before the ISA deadline in April.

I am considering using Individual Savings Accounts limited who are discount brokers based in Derby.
Does anyone have any comments about their service, i.e is it good or bad?

I am thinking about putting some money into an emerging market fund as well as a UK or US fund.
The Lazard emerging market fund charges seem very high: The charges are £17.5 Initial charge discounted, 1.5% AMC taken out of growth, 0.6% other annual expenses are 0.6%.
Does anyone know what the other annual expenses are for and can this be added to the amc of 1.5% to give a 2.1% annual charge on growth.

Are these charges to high or do emerging market fund generally have higher charges.

Any other general comments would be much appreciated.


Cheers

newfundinvestor

frivolous_fay

dunstonh wrote: »

What questions?

Post no. 37 I think.

I'm also a noob, feeling baffled, and thinking this isn't the thread for me

competitionscafe

newfundinvestor wrote: »

The Lazard emerging market fund charges seem very high: The charges are £17.5 Initial charge discounted, 1.5% AMC taken out of growth, 0.6% other annual expenses are 0.6%.

The annual charge for this fund (1.5%) is pretty average for the sector and the standard initial charge (3.75%) is actually below average. The initial charge can be reduced to zero via a discount broker like bestinvest or hgl. The Total Expense Ratio (TER) of 1.66% is also around average. According to the best invest website "The average TER for actively managed equity funds is 1.6%, for tracker funds is 0.9% and for bond funds is 1.3%."

You can compare charges for emerging market funds here:
http://www.bestinvest.co.uk/funds/FMPro?-db=webprices.fp5&-format=fundperflist.htm&-lay=fund%5finfo&calc%5ffundtype=open&calcsector=Emerg&-max=200&-find=&-token=2&-token.2=2&-sortfield=total_ann_cost&-sortorder=ascending

Obviously the cheapest fund is not necessarily the best option, charges are only one aspect to consider although clearly higher charges will have a negative effect on performance.

mrmusic

Can anybody tell me what is the difference and or benefits between using an on -line broker such as Best Invest or HL, or investing directly into a fund supermarket such as Funds Direct?

I appreciate that both methods can generally save you money on both the initial purchase and the annual management charge but I can't see any benefit in going through a broker.(Most brokers seem to link in to Fund Supermarkets anyway).

I am not investing enough to get free advice from any of the broker firms (This seems to be given free if you invest >100K)

Help!!

StevieJ

mrmusic wrote: »

Can anybody tell me what is the difference and or benefits between using an on -line broker such as Best Invest or HL, or investing directly into a fund supermarket such as Funds Direct?

I appreciate that both methods can generally save you money on both the initial purchase and the annual management charge but I can't see any benefit in going through a broker.(Most brokers seem to link in to Fund Supermarkets anyway).

I am not investing enough to get free advice from any of the broker firms (This seems to be given free if you invest >100K)

Help!!

If you go directly to a fund supermarket eg Fidelity they tend to charge you with an initial charge and full annual management charge, whereas the discount brokers receive a discount off the FS and pass most of this on to you.

dunstonh

discount brokers are IFAs. IFAs have the ability to rebate some/all of the commission they get. So go via a discount broker/IFA and you can get commission rebated. Go direct to provider and they keep the commission for themselves.

I am not investing enough to get free advice from any of the broker firms (This seems to be given free if you invest >100K)

6-8 hours of paperwork on top of the time getting the information to give the advice is why some set 100k.