Hargreaves and Lansdown S&S ISA

fimonkey

PLease can you knowledgable folk comment on my plan and answer my questions?.

For the tax year 2011/21 I intend to open an S&S ISA with H&L, I will deposit £150p.m. with them as such.

£100pm in a UK all shares passive tracker (I like L&G)
£50p.m in an emerging markets tracker (again I like the one by L&G).

1, Whats the minimum I can put in to start this off? (i.e does it have to be £500 per fund initial outlay for instance)

2. If one month I decide to buy shares with this £150 within the ISA wrapper - would this be worth it given the charges of H&L?-
- to answer my own question, £150 would buy £139.34 worth of shares?(£150 - £9.95 charge - 0.5% stamp duty). This means I would need my shares to rise by 7.11% to getback to £150. Am I right??

3. Do H&L charge commision etc for buying and selling ETF's?

4. Can you use stop losses and buy orders for funds, shares and ETF's with H&L?

My long term plan is to make a portfolio up of many different kinds of investments - but as I can only start with £150pm at the moment this will be a slow process. One way I intend to build up my portfolio is that if my investments rise by 40% I intend to take this profit and re-invest in something else. I am high risk in that with such low sums I am prepared to loose the lot in the first year (hope it won't come to that however). I am educating myself by reading around the subjects but that is also a slow process as I don't seem to take financial stuff in too quickly.

Thanks you indeed

Lokolo

1. If you are going regular it doesn't matter, you can start with £0.

2. Erm, HL are quite expensive for shares, it maybe worthwhile opening a Share Account (non ISA though), for shares.

3. No idea, haven't bought ETFs.

4. No idea, I just let my investments go fourth and whatever will be will be.

Sorry I couldn't be more helpful

fimonkey

hmm actually the more I read the less sure I am. I see from another forum that H&L charge 0.5% management charges for S&S ISA. Is this on top of the management charge (TER) per fund?

I currently hold last years (2010/11) S&S ISA with L&G. I don't think they charge 'management' charges do they? or am I wrong?

And perhaps with the individual shares I should use Inter-active Investor as that seems to be best for low amounts. I initially wanted to hold everything in an ISA to keep it away from the tax -man. But with such low monthly amounts I doubt at this stage I'll be anywhere near the limit for CGT.

Any thoughts please?

dunstonh

I see from another forum that H&L charge 0.5% management charges for S&S ISA. Is this on top of the management charge (TER) per fund?

They charge 0.5% on non commission investments (which will be all investments from the start of 2013 unless they were bought pre 2013). However, they have a couple of loss leaders where they do not levy this charge (some of the HSBC funds). This is on top of the TER.

I currently hold last years (2010/11) S&S ISA with L&G. I don't think they charge 'management' charges do they? or am I wrong?

All funds have an annual management charge. Bundled platforms though either don't offer the non commission funds, offer but accept a loss on them or offer them and charge an additional amount.

Going direct to fund house can avoid a platform charge.

And perhaps with the individual shares I should use Inter-active Investor as that seems to be best for low amounts. I initially wanted to hold everything in an ISA to keep it away from the tax -man. But with such low monthly amounts I doubt at this stage I'll be anywhere near the limit for CGT.

To be honest, trying to split an amount of just £150 pm is probably not worth it. You may as well wait until you get to around £8000 before you start doing that.

Ilya_Ilyich

1) No minimum other than the £50/fund minimum monthly investment.

2) No it wouldn't be worth it at that level of purchase; your sums are right.

3) ETF purchases are charged the same as share purchases so yes.

4) Can''t answer this one I'm afraid as I haven't traded through HL due to their fees.


If you're after a UK tracker then HSBC have their own one available through HL at a fraction of L&G's price.

cing0

fimonkey wrote: »

4. Can you use stop losses and buy orders for funds, shares and ETF's with H&L?

No.

HL don't offer stop loss/limit orders (for equities and ETFs) and I don't know anyone who does this for funds. Be aware that for funds with HL, you have to get your order in before 8am to trade funds valued at mid-day for that noon's price.

In summary HL can be a bit inflexible and expensive.

fimonkey

HMmm, from what I'm hearing it'd just be best to continue my ISA with L&G? I was a bit concerned with their lack of variety on offer but to be fair I can only invest £150pm so its not as if its huge sums (yet!), L&G charges seem to be cheaper than H&L... And buy shares through a cheaper platform? Seems I'm making this more complicated than it needs to be?- THough there's still the 'lag' when buying trackers through L&G too.

jimjames

fimonkey wrote: »

HMmm, from what I'm hearing it'd just be best to continue my ISA with L&G? I was a bit concerned with their lack of variety on offer but to be fair I can only invest £150pm so its not as if its huge sums (yet!), L&G charges seem to be cheaper than H&L... And buy shares through a cheaper platform? Seems I'm making this more complicated than it needs to be?- THough there's still the 'lag' when buying trackers through L&G too.

I'd say it was definitely preferable to move it to HL especially if you are just thinking of keeping the current funds. HL is one of the cheapest, if not the cheapest, providers for funds - its just shares & ETF that are not so cheap.

HL allow you to have HSBC trackers which will halve your annual charges compared to equivalent L&G products. It also then gives the flexibility that L&G doesn't have but for no extra cost.

fimonkey

Thanks for the replies, - but there's something I'm just not udnerstanding.

H&L charge an extra 0.5% on top of the normal TER for passive funds right? - So why would it be better for me to move my ISA to them rather than keep it with L&G who only charge the TER?

And why are L&G more expensive with H&L than HSBC? I prefer L&G at the moment - but would look to diversify in the future. I would diversify into passive funds with H&L, - but not if they charge extra. ... What am I getting wrong?

fimonkey

dunstonh wrote: »

They charge 0.5% on non commission investments (which will be all investments from the start of 2013 unless they were bought pre 2013). However, they have a couple of loss leaders where they do not levy this charge (some of the HSBC funds). This is on top of the TER.
.

Thanks Dunstoh. How can I find out which funds are loss leaders where they do not levy this charge? Is it a case of going through the funds one by one?

jimjames

fimonkey wrote: »

Thanks for the replies, - but there's something I'm just not udnerstanding.

H&L charge an extra 0.5% on top of the normal TER for passive funds right? - So why would it be better for me to move my ISA to them rather than keep it with L&G who only charge the TER?

And why are L&G more expensive with H&L than HSBC? I prefer L&G at the moment - but would look to diversify in the future. I would diversify into passive funds with H&L, - but not if they charge extra. ... What am I getting wrong?

No, HL do not charge 0.5% for ALL passive funds - just some like Fidelity Moneybuilder. HSBC funds do not attract this charge.

For example the TER for HSBC UK tracker is 0.27% but L&G is 0.55% (I believe) so you are paying double the annual charge for effectively the same funds.

On the HL funds page any additional charge is shown.