Hargreaves Lansdown (HL) Managed Service

dunstonh

The OP says he is struggling to understand all the different choices of funds available & is looking at alternatives, i've offered an alternative to look at for free, you just steam in with an off the cuff remark which bears no relevance.

You said you were in a similar situation to the OP. The OP is looking at advised or managed solutions. Yours is a DIY. Salty Dog is DIY. It is only fair the OP knows the differences.

If it works for you great. If you are still doing it in 3 years time and not just 3 weeks then great. I have no issue there but it is relevant to point out that Salty Dog is something different to what he has indicated in his post.

jamesd

quattro2, if the HL Advice service that tjd08 was providing is offering proper independent financial advice then their client will get things like redress if the advice given was not appropriate for the circumstances of the investor. The "if" about the independent financial advice is because HL describes the people giving it as financial practitioners and that could be wording intended to confuse people about whether it is proper IFA service or not.

The HL Vantage platform doesn't provide that. The Salty Dog guidance also doesn't provide that. You pay more for IFA advice but you get extra protection and what I hope would be a custom service.

One of the potential difficulties with the HL advice service is that it adds extra cost to what is already an expensive place for those with lots of money invested to hold investments with. Someone with the £100,000 plus that the advice service is targeted for can probably get the advice but also have the investments held on a non-HL platform that allows them to be held at lower cost with possibly better service, and almost certainly better disclosure of charges. With £100,000 invested in commission paying funds HL will be receiving around £500 a year more remuneration than an alternative platform that charges 0.25-0.3% of the amount invested instead of the 0.75% to 0.8% that HL charges just for holding funds on the platform, without any professional advice.

There are things that HL is very good at but lowering costs to clients with larger holding sizes and good disclosure of remuneration are two areas where it performs poorly. Sometimes the customer and dealing services can make up for that - those are areas where they do perform very well, superbly IMO when it comes to general customer service.

These things make me somewhat conflicted about HL. I view its charging disclosures as unethical deception and misleading financial promotions but think it does other things very well. So there's a constant tension for me about whether I should be rejecting and recommending against using HL and whether I should be reporting its promotions to the FSA or not.

Sadly HL's pricing conduct means that I do at least two or three takes at anything it says these days, because I no longer trust the firm to be fully truthful to its customers.

gadgetmind

FWIW, HL say they will be bringing in some trail rebates in SIPPs next year. No details yet.

I also treat their bumph with a combination of caution and disdain, but the same is true of the vast majority of investment related material.

At the end of the day, HL's costs are in the open if you're prepared to go beyond the bumph, and as long as you hold the right investments in the right quantities, you can keep fees low.

Their customer service is also very good.

jamesd

Good to read about possible SIPP trail rebates. They seem to have some need to do something for those with larger holdings because the rewards for leaving start to become quite significant.

But just saying what they really charge and not pretending in their marketing that they aren't getting commission would be a big improvement for my view on the ethics of how they act. I expect they are acting within the letter of the regulations, though.

dunstonh

FWIW, HL say they will be bringing in some trail rebates in SIPPs next year. No details yet.

Someone pasted a response from HL in another thread that they are hoping the FSA change their mind on the RDR. If HL are saying they will bring in some trail rebates next year then that is very strange. Trail is eliminated for new purchases in January. Trail funds will no longer be available for new business. Perhaps they are talking about existing business where trail can continue.

HL are not the only ones burying their heads in the sand about RDR and platform review. There are plenty out there who are hoping for U turns. Although we dont know if that is the official HL view or third party posting. I cant imagine HL saying officially that they are hoping for U turn on RDR. I could on platform review and have seen a few articles where with comment from them but the whole principle is to get away from hidden commissions and bias potential. Is the FSA really going to allow that to continue. Especially when consumer groups and the Consumer Panel are in favour of unbundling and the average consumer is no worse off. The main differences are just that you know who is getting what and people are not being paid money for not doing things.

jamesd

HL are perhaps the biggest reason for the FSA to want to include execution only platforms within the rules, so them persuading the FSA not to include them would be quite a trick.