Investing for dummy question

chile_paul

I've had some investment in two different managed funds for 10 years+ now (a small amount of money from my parents which has now grown very nicely) which have done well over the long term. You need to accept that some years you might have a significant fall in value if the markets drop and therefore you should always be asking yourself when you will need the money. If you need it in the next year you probably shouldn't have it invested, if you can afford to leave it invested for 5 years then my investments have always grown.

However recently I started looking at the fee's I was paying for the managed funds and the relative performances. With fee's at circa 2% per annum I would need the funds to be outperforming equivalent investments - and they weren't. As a result I'm in the process of moving these investments out of managed funds and into investment trackers that have much lower fee's (0.25% per annum). I'm splitting it across a FTSE 100 tracker a FTSE 250 tracker and an American index tracker (can't remember precisely which one) all of which are held within an ISA wrapper on the iWeb platform which has very low trading fee's and no ongoing fee's

puk999

paul_scholey wrote: »

As a result I'm in the process of moving these investments out of managed funds and into investment trackers that have much lower fee's (0.25% per annum). I'm splitting it across a FTSE 100 tracker a FTSE 250 tracker and an American index tracker (can't remember precisely which one) all of which are held within an ISA wrapper on the Halifax platform which has very low trading fee's and no ongoing fee's

Is the Halifax offering the one mentioned here with a £12.50 annual charge? Am I correct in assuming you're buying your trackers via ETFs? Halifax's Fund Range only seems to include three funds.

chile_paul

puk999 wrote: »

Is the Halifax offering the one mentioned here with a £12.50 annual charge? Am I correct in assuming you're buying your trackers via ETFs? Halifax's Fund Range only seems to include three funds.

Sorry, my mistake. I'm using the iWeb platform which Martin references on his main Stocks & Shares NISA page (which is part of Lloyds group and not Halifax as I thought for some reason). There is an account opening fee of about £25 and then a £5 fee per trade.

Archi_Bald

puk999 wrote: »

Halifax's Fund Range only seems to include three funds.

The Halifax Sharedealing platform has the full range of funds and shares that any major UK platform has. See http://www.halifaxmarketwatch.co.uk/

So does the iweb platform as it is a clone of Halifax Sharedealing, and is in fact administered by Halifax (except if it is a SIPP, which is administered by A J Bell for both, Halifax Sharedealing and iweb)

paul_scholey wrote: »

Sorry, my mistake. I'm using the iWeb platform(which is part of Lloyds group and not Halifax as I thought for some reason).

Well, Halifax is part of the Lloyds group, and see above....

puk999

paul_scholey wrote: »

Sorry, my mistake. I'm using the iWeb platform which Martin references on his main Stocks & Shares NISA page (which is part of Lloyds group and not Halifax as I thought for some reason). There is an account opening fee of about £25 and then a £5 fee per trade.

I'm currently with Fidelity via Cavendish paying 0.25%. I have S&S ISAs worth £39k, £3k of which is contributions from this tax year. So I could transfer out the £36k of previous years' ISAs to iWeb, pay the joining fee of £25 and possibly a £5 fee for putting it all into one fund and then there'd be no further costs (assuming I'm happy with just 1 fund and didn't tinker afterwards)? I'm currently paying Cavendish/Fidelity £90/annum on that £36k I believe. Hopefully someone can sanity check this for me.

chile_paul

puk999 wrote: »

I'm currently with Fidelity via Cavendish paying 0.25%. I have S&S ISAs worth £39k, £3k of which is contributions from this tax year. So I could transfer out the £36k of previous years' ISAs to iWeb, pay the joining fee of £25 and possibly a £5 fee for putting it all into one fund and then there'd be no further costs (assuming I'm happy with just 1 fund and didn't tinker afterwards)? I'm currently paying Cavendish/Fidelity £90/annum on that £36k I believe. Hopefully someone can sanity check this for me.

You also need to consider the fee's associated with the fund that you invested in. The £25 opening fee and the £5 per trade are the costs associated with the platform itself (that includes £5 every time you increase your investment therefore if you had an extra £3k to invest it wouldn't be too bad, but if you were paying in £100 a month this would equate to a 5% charge).

However you then need to consider the fee's associated with the fund that you choose to invest in via the platform - these can range from very low (circa 0.1%) up to circa 2%.