TD regular investment ISA charges.

viola_brandywine

Very interested in this as I am also considering moving from HL to TD. What is the likelihood they will introduce new charges like HL did?

bowlhead99

I would speculate they will have to at some point - because as it stands, they are making it free to run an account for you that takes money from you, buys, holds, and sells cheap trackers and returns the money to you - with all the ongoing admin, reporting and compliance which that entails.

This can only really work if they are making enough money off customers on the stockbroking side from individual shares and bonds and ETFs being traded, and while they get platform / trail commission coming in from the funds with larger management fees. Clearly it is good business to bring new customers over to your platform who allow you to make profits in the other areas.

In the next year or so the 'platform review' will make TD and their rivals take another look at the fee structures and I would expect changes from that based on what competitors do and how much money they are really making at the moment in different areas.

From looking at the types of fees with other providers - TD might choose to extend their current quarterly or annual charges to accounts where there have been no transaction fees, rather than just no transactions. Or they might just start charging for all buys and sells, like SIPPdeal for example. TD's equivalent products in the US and Canada are good and well priced, but they will be reacting to the local UK regulation and competitors in any new pricing.

So on that note, be aware that the way they're currently structured is that their ISAs have an account closure fee. Personally I was with TD long before I ever did any fund investing, so while it's handy to have everything in one place I would not necessarily be driven to leave if the funds became less competitive.

ccbrowning

To be fair, the TD operation in the United States doesn't really have any fees in this area. In my American account I don't even pay fees for quite a few ETFs! So, perhaps it is just a loss leader of sorts to get you to do other business with them. *crosses fingers*

viola_brandywine

Hmm difficult choice. I joined HL just before they brought in the platform charge and ended up switching all my funds to ones that didn't attract it. I have been reluctant to pay more into it since as I'm no longer sure that I am invested in the right funds. It is very difficult to know what to do next.

grey_gym_sock

viola_brandywine wrote: »

Hmm difficult choice. I joined HL just before they brought in the platform charge and ended up switching all my funds to ones that didn't attract it. I have been reluctant to pay more into it since as I'm no longer sure that I am invested in the right funds. It is very difficult to know what to do next.

are you in tracker funds? with HL, there are blackrock trackers with TERs around 0.57% and no platform fee. they are a logical choice if you don't have enough in each fund to justify paying £24 per year (and want trackers, and are already with HL, and don't want to move until other providers' charges are more settled).

viola_brandywine

Thanks for that grey gym sock - I'll take a look.

viola_brandywine

That looks like the answer for me, for now at least. Aside from the TER being on the high side for trackers, could there be other downsides? I'm assuming HL get something out of selling these for them not to charge the platform fee.

I'll do some reading up on their performance/tracking errors.

ccbrowning

The BlackRock ones can be pretty good - I have about 33% of my investments in them.

Monevator has some decent articles, too:
http://monevator.com/blackrock-index-trackers/
http://monevator.com/blackrock-index-funds-tracked/

Worth doing some research on if it's a better deal to go with say SWIP or HSBC tracker funds via TD, perhaps.

viola_brandywine

Thanks ccbrowning. Ah, there is a bid/offer spread that didn't exist on the HSBC trackers. Still, looks like it might be the best of a bad lot when you are just starting out.