Danny Cox of Hargreaves Lansdown being pulled apart on Radio 4 Moneybox over new fees

Freecall

dunstonh wrote: »

Is there any reason you prefer a SIPP and the vanguard VLS fund when similar options are available on PPPs at lower cost. 0.40% OFC inclusive of wrapper and fund for example is possible.

You are paying for a wrap platform but not taking advantage of platform services. So, you have to ask why you are willing to pay for that?

In Which PPP's could Daneb hold his/her VLS funds?

atypical

jimjames wrote: »

The fact that Danny Cox refused to answer or confirm that HL make 71p out of every £1 they take would suggest it is correct. If it wasn't then he would have outright denied it.

That is some impressive profit margin so you can see why they don't want to let it go.

The 71.5p figure comes from their presentation to analysts here:
http://www.hl.co.uk/__data/assets/pdf_file/0008/7799210/Retail-Distribution-Review-analyst-presentation.pdf

For some reason they're using net income rather than revenue which isn't an operating margin most people would recognise. Calculated as usual, it's 65.8%.

There's also an audio recording:
http://hl.kulu.net/view/u4v32aV5awe

Haven't listened to all of it but Ian Gorham states the reason fund charges will be released in March is there are a "number of fund groups that don't want to be part of the initial publicity".

Deneb

dunstonh wrote: »

Is there any reason you prefer a SIPP and the vanguard VLS fund when similar options are available on PPPs at lower cost. 0.40% OFC inclusive of wrapper and fund for example is possible.

You are paying for a wrap platform but not taking advantage of platform services. So, you have to ask why you are willing to pay for that?

The only reason I'm in a SIPP is that I wanted to hold VLS within a pension wrapper and before RDR an HL SIPP was a fairly cheap way of achieving that, which with a fixed £2/month fee became relatively cheaper as the size of the holding increased.

Obviously that is no longer the case. I still like VLS and would prefer to continue to hold and increase my investment in the fund within a pension wrapper. What I'm trying to determine is whether it is possible for me to do that elsewhere, or whether I can only bring costs down by switching platform and investment.

After a bit of googling, I found that BestInvest appear to cater for VLS funds within a SIPP or ISA with no setup or transfer in charges, will pay the cost of transferring from HL, no dealing charges for funds and an annual platform fee for VLS60 of 0.31%. This is better than HL's new charges for both SIPPs and ISAs but I'm not clear if this is pre or post RDR pricing?

Archi_Bald

You should be careful about SIPP costs - - I believe there are potentially some more charges than initially meets the eye.

Use this to figure out the total: http://www.comparefundplatforms.com/compare.aspx

Though unfortunately, HL aren't part of the comparison, so you need to do them manually.

westy22

After a bit of googling, I found that BestInvest appear to cater for VLS funds within a SIPP or ISA with no setup or transfer in charges, will pay the cost of transferring from HL, no dealing charges for funds and an annual platform fee for VLS60 of 0.31%. This is better than HL's new charges for both SIPPs and ISAs but I'm not clear if this is pre or post RDR pricing?

Bestinvest have yet to announce their post RDR pricing although it is expected very shortly.

grey_gym_sock

dunstonh wrote: »

Skandia have got lower pricing on their blackrock trackers since RDR. e.g. Blackrock Cont Euro moved from 0.22% to 0.12%.

interesting. is that as a cheaper class of units, or with rebates in units?

dunstonh

grey_gym_sock wrote: »

interesting. is that as a cheaper class of units, or with rebates in units?

I believe they have class L available but the last one I did was class D but had rebate.

grey_gym_sock

dunstonh wrote: »

I believe they have class L available but the last one I did was class D but had rebate.

i'm a bit confused by that, because trustnet says class D is 0.18% and class L is 0.23% ...?

SnowMan

grey_gym_sock wrote: »

i'm a bit confused by that, because trustnet says class D is 0.18% and class L is 0.23% ...?

That was the same conclusion I came to. The D class has been 0.18%pa OCF for a while.

I don't know anything about the L class (as in who offers it for example) but when I looked it up in a couple of places like you did the OCF seemed to be higher than the D class.

The Black Rock D class is about as cheap as it gets for European fund trackers. L&G I class is 0.2%pa OCF and also tracks the FTSE Europe exc UK index.

Vanguard is 0.25%pa OCF and HSBC C class is 0.28%pa OCF. These both track the different FTSE Developed Europe exc UK index I think.

Vanguard has a 0.15%pa ETF Europe tracker which tracks the FTSE Developed Europe including UK index.

and HSBC have an ETF tracking the MSCI Europe including UK index at 0.30%pa.

dunstonh

grey_gym_sock wrote: »

i'm a bit confused by that, because trustnet says class D is 0.18% and class L is 0.23% ...?

The one I did with class d and rebate was in September and before they dropped the price to 0.18%. So, the literature then was printed using the old price.

Just checked Skandia funds guide and they say they are using class L and they link to a class L factsheet. However, the transactions on real cases are actually using class D and the charges relate to class D. Skandia are giving a 0.10% rebate on class D.