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HL u-turn on investment trusts
Comments
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If I switched the funds to ITs, my charges would remain capped at £200pa (which I am happy to pay). What would be the disadvantage of moving to ITs and what are the boards recommendations for the cheapest pseudo trackers (UK, US, JP, EU and PR)?
Since ITs, ETFs and shares are now all the in same charging structure, have you considered ETFs? For example Vanguard have a nice selection of the areas you're interested in.
The main disadvantage is they cost to deal while UT/OEICs don't.0 -
gadgetmind wrote: »
Comparing the Vanguard ETF to the HSBC EUR index fund, the ETF underperforms consistently. Is there an obvious reason for this?0 -
Has nudged the shareprice down. FTSE up but HL down 6.41% this morning.
Investors suspecting it hasn't all gone as swimmingly as they were told?0 -
One of the reasons why I preferred Vanguard funds to ETFs is that the UK ETF is FTSE 100 only, while the fund is an all share tracker, similarly the global ex UK fund supposedly tracks 98% of the global market capitilization, while the ETF is large cap only.
Certainly my gains in the funds over the last couple of years appear to have far outweighed the savings in cost of ETFs, although of course this will not always be the case.0 -
Rollinghome wrote: »Has nudged the shareprice down. FTSE up but HL down 6.41% this morning.
Investors suspecting it hasn't all gone as swimmingly as they were told?
No apparently they reported a mere 11% increase in profits instead of the expected 15%!
http://www.standard.co.uk/business/business-news/hargreaves-lansdown-dives-after-it-posts-a-profits-miss-9108790.html0 -
That would do it. I suspect at least half of that will have been caused by Gadget jumping ship.No apparently they reported a mere 11% increase in profits instead of the expected 15%!
http://www.standard.co.uk/business/business-news/hargreaves-lansdown-dives-after-it-posts-a-profits-miss-9108790.html
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Comparing the Vanguard ETF to the HSBC EUR index fund, the ETF underperforms consistently. Is there an obvious reason for this?
Dunno. Do they track the same index?I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
Rollinghome wrote: »at least half of that will have been caused by Gadget jumping ship.
Arf!
Anyway, they don't exactly make a fortune from us 'cos I'm, err, careful!I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
That's perhaps not the big deal for them. It's the way they do a great job of acquiring new low value customers - 56% less than £25k according to them - then with their percentage charging effectively pay people to leave them as their holdings get larger, with them not benefiting from their or HL's scale compared to alternatives. They provided a pretty picture of how their scale is cutting costs, here's the cost ratio in % and approximate amount invested year to year:Anyone like to start a 'book' on how long it will be before HL reconsider their 0.45% on funds now that they seem to stand out as the most expensive platform and that 0.35% looks to be nearer the norm?
2007: 0.61% 10 billion
2008: 0.49% 11
2009: 0.48% 12
2010: 0.42% 16-17
2011: 0.32% 21-22
2012: 0.28% 23
2013: 0.24% 32-33
2014: ????? 43
Notice how them scaling their size produced large per-customer cost savings and rewards them for growing their business. But where's that drop of 0.37% in costs, more now given the 43 billion today, showing up in costs for clients? "To offset the total effect of all these tariff changes would require total additional AUA [assets] over the next 3 years of: c. £3.5 bn". They just announced an increase of more than ten billion.
A little of the scale benefit shows up but not a lot and not to those who pay the biggest bills and hence have the greatest incentive to use HL only for training wheels.
HL still do offer a good package for smaller investors, where percentage-based charging doesn't hurt and can be good while there's likely to be high appreciation for their customer service levels.Rollinghome wrote: »However there's no doubt that there has been a change in attitudes and perceptions of the company that's happened gradually over the past few years and not just in recent weeks. There was a time when HL were the automatic recommendation on this board for funds with few dissenters. They were seen as a discount broker who offered good value and countless clients would have found their way to HL as clients after reading recommendations here.0 -
grey_gym_sock wrote: »http://www.hl.co.uk/news/articles/investment-trusts-a-review-of-charges
they will not, after all, introduce a separate holding charge for ITs. they'll continue to be treated the same as other shares/ETFs/bonds.
i suppose this annoyed too many ppl, and wasn't going to raise that much revenue anyway. (and isn't required by RDR2.)
Great news. I did wonder if they had really thought that one through properly. I wonder how much more of the reaction is a shock to them.Remember the saying: if it looks too good to be true it almost certainly is.0
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