Hargreaves Lansdown

bowlhead99

Zola. wrote: »

HL seems a nice site as it is fairly straight forward to deal with, are there other sites that you would recommend and that are easy to use for medium cap punts at a cheaper rate?

Should I open a stocks and shares ISA? I just opened a basic "Vantage Fund and Share" account.

It seems bizarre that you came on here yesterday lunchtime asking if there were other sites we would recommend for what you wanted to do, and four or five other people suggested good rival sites or referred you to websites which had comparisons of broker/platform charges... and yet by this morning you have just gone ahead and opened an ISA account at HL anyway - even though the markets aren't open until Tuesday so you can't use it.

You are right to use an ISA instead of an 'unwrapped' normal account without tax advantages. And you are right that HL is user-friendly. BUT it is expensive which is why half the people on this thread have told you to shop around:

- if you are investing with open ended funds, HL charges 0.45% on your assets every year. Others charge only 0.25% for the same thing, or 0.2% with small transaction fees, or in a few cases 0% with larger transaction fees. So it is probably close to double the market rate for investment in open-ended funds.

- if you are buying ETFs or individual shares in your ISA instead of open ended funds, HL still charge the 0.45% on your assets every year until you hit £10,000 (i.e. up to £45 fee per year) as well as charging the same £12 fee that you've experienced on all your transactions. By contrast, Youinvest which was mentioned by Bananarepublic above only charges £0 per year and £10 per transaction (or quite a bit less on a regular investment program). Or x-o.co.uk charges £0 per year and £6 per transaction, although X-O have a more simplistic website because (unlike HL and Youinvest) they don't offer funds or have research tools.

If I were you, I would transfer whatever you deposited into HL's ISA into another cheaper platform. If you are only investing a few hundred pounds I don't suppose it matters, but if your intention is going to be to invest long term, the unnecessary fees really eat into your returns.

For example:

£5000 invested and left for ten years at 7% total return is £9835

£5000 invested and left for ten years at 6.5% total return because you're unnecessarily paying half a percent to hold your ETFs is £9385.

Would you rather have £9835 or £9385? Hint: one of them is about £450 (~5%) bigger than the other.

BritPop

HL charge 0.45% for ISAs with fund (Shares, investment trusts, ETFs, gilts & bonds are capped at £45 total charge per year). rPlan charge 0.35%. Charles Stanley charge 0.25% for ISA funds.

But if you look at the fund charge of a popular fund such as CF Woodford Equity Income C Fund Acc
HL charge 0.6% fund fee. rPlan and Charles Stanley charge 0.75% fund fee.

Charles Stanley would still be cheaper by 0.05%. Personally though I find the HL portfolio tools and customer service to be excellent, so you have to decide if that is worth 0.05% or not.

jimjames

BritPop wrote: »

But if you look at the fund charge of a popular fund such as CF Woodford Equity Income C Fund Acc
HL charge 0.6% fund fee. rPlan and Charles Stanley charge 0.75% fund fee.

But if all the other funds are the same AMC between HL and other platforms you'll still be worse off with HL. The Woodford fund is unlikely to be your only holding so you need to view them all to make that decision.

wooder

Interesting discussion here re HL recommendations, charging structure, etc.

coyrls

Zola. wrote: »

But I'm just going to let it sit there and see what happens.

Well one thing is already certain, you will need over 20% growth for your investment to break even after charges.

Zola.

Thanks for all the replies.

I am going to stick with HL for now, whilst I work my way through Tim Hale's "Smarter Investing" book. I am about 1/4 of the way through and its an interesting read. I will consider other brokers more carefully in future.

I have taken that £100 from my ISA and invested it in "Vanguard LifeStrategy 80% Equity"

No £12 charge for setup, and the yearly Net ongoing charge is 0.24%

coyrls

Zola. wrote: »

Thanks for all the replies.

I am going to stick with HL for now, whilst I work my way through Tim Hale's "Smarter Investing" book. I am about 1/4 of the way through and its an interesting read. I will consider other brokers more carefully in future.

I have taken that £100 from my ISA and invested it in "Vanguard LifeStrategy 80% Equity"

No £12 charge for setup, and the yearly Net ongoing charge is 0.24%

You've managed to spend the same £100 twice?

Zola.

No, both accounts required £100 deposit to open.

Doshwaster

Zola. wrote: »

I have opened up a ISA with HL and will user that instead.

I knew of course my first small purchase was entirely gung ho.... But I'm just going to let it sit there and see what happens.

I plan to put larger amounts into diversified ETFS and then use small amounts for punts.

You aren't going to get anywhere with small "punts". I would suggest setting up a monthly direct of £50, £100 or whatever you can afford to automatically buy units in the investment of your choice and get into the habit of long term investing. Don't go for anything too exotic to start with - a nice boring index tracker is an ideal way to get going.

Zola.

Doshwaster wrote: »

You aren't going to get anywhere with small "punts". I would suggest setting up a monthly direct of £50, £100 or whatever you can afford to automatically buy units in the investment of your choice and get into the habit of long term investing. Don't go for anything too exotic to start with - a nice boring index tracker is an ideal way to get going.

Cheers... much has changed from a few days ago haha....I am about half way through this book and learned a load already.

I wont be trying to beat the market and taking punts as its likely to end in frustration.

I do plan to invest into various index trackers every month, like the Vanguard Life Strategy 60 & 80, and a few others like that.

I am in it for the long haul..... 20 years or more. :beer: