Cavendish Online & Fidelity FundsNetwork £45 Account Fee

blibbert

Just in case anyone else comes across this confusing information from Cavendish Online and the Fidelity FundsNetwork platform where, when you login to your account, it states that your 'advisor' has opted you into the Account fee (when really is hasn't).

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Cavendish website states 1/10/13
cavendishonline.co.uk/investments/

“The Cavendish Online FundSupermarket (powered by FundsNetwork™) will have no other charges than the Annual Managment Charge (AMC) applied to the selected fund and all trail commission will be rebated. As a result of this new facility, Cavendish Online customers will now benefit from:
· NO initial charges on all funds
· NO switching fees
· NO Cavendish Online fee
· 100% rebate of natural trail commission
“

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Fidelity FundsNetwork states 1/10/13
fidelity.co.uk/investor/products-services/investment-options/account-fee-adv.page

· Annual fee of £45 per annum (£22.50 collected half-yearly)
· No initial charges on lump sum and Monthly Savings Plan investments submitted online
· No switching fees on all transactions submitted online
· Qualifying investments include ISAs (including paper transfer applications) and mutual funds held outside of an ISA
· One fee payment covers all of your accounts on which you receive advice (single and joint)
· Once your Adviser has informed us that you wish to pay the · Account Fee you will enter a cooling-off period during which you can change your mind.
· After the cooling-off period has ended you will not be able to switch out of the Account Fee and opt to pay our alternative Initial and Switch Charging pricing option.

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Cavendishes response 1/10/13 :

I am sorry for the confusion caused by the information on the Fidelity FundsNetwork website.

Cavendish Online have special terms with Fidelity FundsNetwork to other brokers which means all our clients get nil initial charges and the free switching without having to pay Fidelity FundsNetwork’s £45.00 annual fee.

The information on the Fidelity FundsNetwork website is only applicable to clients using a financial advisor other than ourselves but I can appreciate that this is confusion, but Fidelity FundsNetwork have not produced special information that just relates to our clients.

jem16

blibbert wrote: »

Just in case anyone else comes across this confusing information from Cavendish Online and the Fidelity FundsNetwork platform where, when you login to your account, it states that your 'advisor' has opted you into the Account fee (when really is hasn't).

---

Cavendish website states 1/10/13
cavendishonline.co.uk/investments/

“The Cavendish Online FundSupermarket (powered by FundsNetwork™) will have no other charges than the Annual Managment Charge (AMC) applied to the selected fund and all trail commission will be rebated. As a result of this new facility, Cavendish Online customers will now benefit from:
· NO initial charges on all funds
· NO switching fees
· NO Cavendish Online fee
· 100% rebate of natural trail commission

Cavendish Online is keeping 0.05% of the Platform Fee without explicitly stating this.

That may have to change under RDR.

grizzly1911

jem16 wrote: »

Cavendish Online is keeping 0.05% of the Platform Fee without explicitly stating this.

That may have to change under RDR.

How will Cavendish Online earn an income?

An investor WILL NOT pay anything directly to Cavendish Online. The only charge that an investor will have to pay is the AMC (Annual Management Charge). Cavendish Online will then rebate any natural trail commission received back to the client. Cavendish Online will retain a small proportion of the total annual charge payable, equivalent to £5.76 per annum for an ISA valued at £11,520 (which is the 2013/14 ISA limit).
The illustration below shows a typical fund (Invesco Perpetual High Income) where an AMC of 1.5% is charged. By using Cavendish Online you will be rebated 0.5% of this every year.


http://www.cavendishonline.co.uk/investments/our-service/


Accept it will probably need to change as you say but not exactly hiding their fee.

WoodM

Cavendish is the 'cheapest' atm because it has no overheads. It uses the Fidelity platform and has low number of staff. It receives the AMC, but only takes a very small percentage of that because it doesn't need it all to cover its costs/turn a small profit!

Things will most certainly change from April next year...

KDH_2

Seems the discount of the £45 investor fee has come to end.according to an online document received today.

jimjames

KDH wrote: »

Seems the discount of the £45 investor fee has come to end.according to an online document received today.

Received from Cavendish or Fidelity?

enthusiasticsaver

I received this online document from Cavendish online today as well saying the investor discount of £45 has come to an end. Does this mean that Fidelity will be taking the £45 per year charge from my portfolio then or Cavendish will? Does this mean that Cavendish is no longer one of the cheaper platforms?

Perelandra

jimjames wrote: »

Received from Cavendish or Fidelity?

From Fidelity. I've asked Cavendish to confirm.

It will be a shame if it's removed, as it was now, I think, the only remaining finacial benefit to going to Fidelity via Cavendish?

If it's correct, it will probably be the catalyst to make me move my accounts, which were already pretty borderline, post RDR.

puk999

I had the same online document today. From FundsNetwork.

Rollinghome

The Cavendish website still says:

Cavendish Online FundSupermarket

Cavendish Online has created a fund supermarket providing the cheapest route to buy a stocks & shares ISA.
All new investments to the Cavendish Online FundSupermarket (powered by FundsNetwork™) will have
THREE explicit charges applied:
1. A fund manager charge
(This charge will vary according to the fund you wish to buy and vary between 0.07% and 0.85% with most at 0.75%.
Tracker funds start from 0.07%. Please click here to identify a specific fund charge.
2. A platform charge of 0.20%
3. A Cavendish Online Ongoing fee of 0.05%

So could be that Fidelity didn't intend to include Cavendish clients in that statement so would be worth clarifying the situation with Cavendish.

jimjames

Perelandra wrote: »

From Fidelity. I've asked Cavendish to confirm.

It will be a shame if it's removed, as it was now, I think, the only remaining finacial benefit to going to Fidelity via Cavendish?

If it's correct, it will probably be the catalyst to make me move my accounts, which were already pretty borderline, post RDR.

It's still cheaper, 0.25% vs 0.35%. Only works cheaper direct if you have over the next tier when it drops to 0.2% direct.