Is H-L really the best choice for fund investing?

Reaper

Most people on this board favour Hargreaves Landsdown as the best discount broker for investing in funds (though not shares).

However I have been looking at an alternative. It's CoFunds going via Cavendish Online. Now I only looked at only a miniscule sample of 2 funds but here are my findings for what that's worth, showing what each refunds.

Aberdeen Emerging Markets
H-L: Initial refund = 5%, AMC Refund 0.25%pa
Cofunds via Cavendish: Initial refund = 4.75%, AMC Refunded = 0.5%pa
Result: Cavendish are cheaper if you hold it for 2+ years.

Invesco Perpetual High Income
H-L: Initial refund = 5%, AMC Refund = 0.25%pa
Cofunds via Cavendish: Initial refund = 5%, AMC Refund = 0.5%pa
Result: Cavendish are cheaper if you hold it for 1+ years.

There are 2 other considerations:
* Cavendish have a one off £25 set up fee
* Cofunds offer 1,300 choices of investments, whereas I think H-L offer 2,300.

Has anyone else tried CoFunds? Any thoughts on which is better?

Lokolo

Theres a £10 annual admin fee too with Cavendish.

edit! nm it doesn't count if you go through CoFunds

oldfella

Cavendish have recently changed the way they pay the trailing commission - its paid directly from Fundsnetwork each quarter, and there is no £10pa admin fee. They pay 0.5%pa on most funds.

LongTermLurker

Can't speak for cofunds/cavendish, but I like HL's customer service. Your comparisons assume you're not adding to your portfolio regularly. If you are buying monthly or topping up throughout the year, HL's full rebate will become increasingly important.

The only nark I have with HL is that income isn't consolidated until it reaches quite a high amount per fund, which limits the benefits of automatic re-investment.

blinko

nice work, but i wonder how this applies to other funds eg natural resources or maye less popular funds

Onawingandaprayer

I used Co-Funds for two or three years, but my understanding then - about 3 years back - was that they only operated via IFAs, and didn't deal direct direct with the public. Unless my advisor was fibbing to me! :mad: Which is, of course, a possibility!

jem16

Onawingandaprayer wrote: »

I used Co-Funds for two or three years, but my understanding then - about 3 years back - was that they only operated via IFAs, and didn't deal direct direct with the public.

That's correct and is still the case as far as I know. This thread is about using Cofunds via Cavendish Online who are IFAs that operate under execution only.

Unless my advisor was fibbing to me! :mad: Which is, of course, a possibility!

No he wasn't.

LongTermLurker

Onawingandaprayer wrote: »

I used Co-Funds for two or three years, but my understanding then - about 3 years back - was that they only operated via IFAs, and didn't deal direct direct with the public. Unless my advisor was fibbing to me! :mad: Which is, of course, a possibility!

OP is going via Cavendish, which is an execution-only IFA (don't think he means the travel agent, anyway!)

dunstonh

Virtually all IFAs will do execution only. Some have it more streamlined (with websites) whilst others will just act on instructions from someone if they phone up or pop in. Most IFAs are not interested in running models like HL or Cavendish as its largely a factory line application process which requires no skills but a large volume to make it profitable.

jamesd

The minimum holding times are too long to make Cavendish/Cofunds a better deal except for those who really do plan to stick in the money and forget about it. I've looked at them a few times and always rejected them for this reason.

Reaper

In the end I guess it depends on what you want to invest in and what your investment style is.

I've got some money coming out of fixed rate accounts soon which I will be looking to invest. I'll be checking out the CoFunds route once I have decided exactly what to invest in but the chances are I'll stick with H-L.

Thanks for the replies.