Help with my ii confusion please

westy22

fimonkey. A couple of years ago I was also using the £1.50 regular investment plan on iii and I discovered that on many occasions the planned day was not an ideal day to buy and then even on a reasonable day the brokers bought at suspiciously close to a high price point.

After analysing this over several months I decided that, in many cases, it would be more profitable to buy 'real time' at a time and day that was of my choosing even though it cost me £8.50 a time more! My purchases were larger than £150, more like £1,000 - but it may be that you paying an additional £4.45 per trade may be worth it in the long run!

jem16

fimonkey wrote: »

I think I am going to transfer my shares in my ISA to TD (who are also broker - that bit confuses me), and then open another ISA with HSBC and hold my tracker there (cos the ii ISA is last years - so I think I can do this, as you can with cash ISA's, need to research that a bit mroe though).

Yes you can do that. Just the same rules for transferring cash ISAs.

Either that, or keep my shares in the ISA with TD and just open the HSBC tracker direct with them but not in an ISA.

If you are just a basic rate taxpayer, I don't imagine inside or outside an ISA will be much of a problem for you.

plarka

Oh my word. This stuff is so confusing! I feel like backing out of my great idea of putting my £500 in an index tracker! Crappy low interest crappy cash ISA's sound much easier and won't take all these fees from me!!!!!!

dunstonh

plarka wrote: »

Oh my word. This stuff is so confusing! I feel like backing out of my great idea of putting my £500 in an index tracker! Crappy low interest crappy cash ISA's sound much easier and won't take all these fees from me!!!!!!

You do realise the fees on your cash ISA are higher than the fees on the index tracker. One is explicit. The other implicit.

plarka

dunstonh wrote: »

You do realise the fees on your cash ISA are higher than the fees on the index tracker. One is explicit. The other implicit.

Oh boy, I had no idea! Ok, I'll get back on track for figuring out this index tracker then. What a learning curve!

Rollinghome

plarka wrote: »

<Quote> You do realise the fees on your cash ISA are higher than the fees on the index tracker. One is explicit. The other implicit. </quote>

Oh boy, I had no idea! Ok, I'll get back on track for figuring out this index tracker then. What a learning curve!

It's a claim often heard from people selling investments but of course is just standard sales patter and shouldn't be taken too seriously.

Yes of course the rate offered on a cash ISA, or any savings account, will have costs including the CEO's hefty bonus.

Any fund, including a tracker, will have the expected explicit fees. Most funds will have additional costs for commissions, platform fees, etc. to many and various parties and there may be still further fees for "advice" if that's required.

But of course before any of that there will also be those pesky costs and CEO bonuses again, including that required by Bob Diamond, of the actual companies the funds invest in.

The lucky investor whose money finances the whole merry-go-round hopes to get a share of anything left over.

Any way you square it there will always be costs for getting your money out of the mattress and a long queue of people hoping for a slice.

dunstonh

I dont expect low knowledge trolls to understand economics as they are too busy looking for ways to slag off others. The fact they say its sales patter then go on to say it exists just shows how low they will go.

Oh boy, I had no idea! Ok, I'll get back on track for figuring out this index tracker then. What a learning curve!

It is called the net interest margin. If you look at the pdf below published by the bank of England and check out page 36, it explains it more and there is a nice chart which shows the net interest margin floating between 2% and 2.5%.

http://www.bankofengland.co.uk/publications/Documents/fsr/2011/fsr30sec3.pdf

Often it is difficult to compare the costs of options where one is explicitly charged and the other implicitly. However, it is important to know that products with no explicit charge will have an implicit charge and are not provided out of love.

Rollinghome

dunstonh wrote: »

I dont expect low knowledge trolls to understand economics as they are too busy looking for ways to slag off others. The fact they say its sales patter then go on to say it exists just shows how low they will go.

Hmm, you ex-insurance salesmen find it difficult to remain polite. (And the same man who solemnly told us that a major global IT was a closet FTSE tracker because he'd never heard of it.) Has it been explained to you what a troll is?

Of course there's a margin. How could any business operate otherwise? The point being that in investment or savings there are all sorts of costs at many levels which makes it misleading and unhelpful, except for sales purposes, to directly compare the costs of one to another.

By saying "You do realise the fees on your cash ISA are higher than the fees on the index tracker." you ignore all the margins and costs at other levels.

You earn a living by persuading people to invest their savings in retail investment products such as insurance bonds and unit trusts (rather than shares and ITs) for which the product providers offer IFAs commission for their efforts. We shouldn't be too surprised if that colours your views.

dunstonh

Hmm, you ex-insurance salesmen find it difficult to remain polite.

Says the person that has been banned from the forum previously for abuse and has a track record of making false allegations and generally being rude at every opportunity.

I'm not going to dignify your specific comments with a response as they are just your usual lies and misinformation designed to provoke a response.

bigadaj

You two are big and ugly enough to fight amongst yourselves, but dunstonh, your post just looks like something to confuse a novice investor, it may have Ben well intentioned but is more likely to confusehim than help him.