Moneyfarm

ValiantSon

DennisTenus wrote: »

And you aren't worried that only 50K of it is protected?!

I've already answered this for you. Look at post #8. No platform is going to have protection greater than £50,000. Your money, however, is very safe because you are not liable for the company's debts. You are not a creditor, as you are with a bank account. In this instance your money is held separately.

DennisTenus wrote: »

Is an OEIC similar to a Fund?

Yes. OEIC stands for Open Ended Investment Company. OIECs are funds.

msallen

Alexland wrote: »

We had Moneyfarm dealing accounts via TopCashBack when they still had the £10k fee free structure. Frankly we did it because they were offering £200 cashback per account if we deposited £900 per month for 3 months and it didn't look like a bad investment. The performance was pretty similar to most other balanced portfolios but the weighted ETF fees were 0.3% which slightly erroded the value of not paying a platform fee. Once the cashback paid we closed the accounts as it was nothing special and I would rather be with a more established player.

Alex.

I'm nearly 2 months into a similar deal at the moment (£220 cb), and have no intention of keeping the moneyfarm account any longer than required to get the cashback, at which point I will sell up and put the proceeds from the (unwrapped) investment there into my regular S&S ISA. Assuming no change in the value of the investments within moneyfarm (even though it's currently up a couple of %) I will see a return equal to >40% AER on the money I put through them.

Eco_Miser

DennisTenus wrote: »

Yeah, so the big question is who do people with 100K+ use? IWeb?

I want to because they are so cheap but worry about the 50K protection.

I do. Other people use other platforms, depending on what type of investments they hold, as different platforms have different charging structures, and an apparently expensive platform can be very cheap for certain products.

As already explained, you are the beneficial owner of the shares and funds you hold through a platform so in the unlikely event of Iweb folding (meaning Lloyds Banking Group abandoning them or going under themselves) you would still own your holdings. Only in cases of massive fraud or gross incompetence would there be any claim on the FSCS.

DennisTenus

ValiantSon wrote: »

I've already answered this for you. Look at post #8. No platform is going to have protection greater than £50,000. Your money, however, is very safe because you are not liable for the company's debts. You are not a creditor, as you are with a bank account. In this instance your money is held separately.

Eco_Miser wrote: »

As already explained, you are the beneficial owner of the shares and funds you hold through a platform so in the unlikely event of Iweb folding (meaning Lloyds Banking Group abandoning them or going under themselves) you would still own your holdings. Only in cases of massive fraud or gross incompetence would there be any claim on the FSCS.

So are you both basically saying that there an EXTREMELY LOW risk of loss or a problem that would require utilising FSCS protection so I should not worry about it as I have 70K+ to invest? And I obviously would prefer to have it in one place. Sounds like the average holding people have in IWeb is probably over 100K?

(I have already allowed plenty in other current accounts for rainy day fund, unemployment, emergencies etc)

So am I actually listed somewhere with each fund I hold that I hold £XXX etc?

jimjames

DennisTenus wrote: »

And you aren't worried that only 50K of it is protected?!

No. The protection is only for a very limited situation but actually more than £50k may be covered if the issue is with the fund not the platform. If you're so worried about risk then S&S may not be the right investment for you.

Eco_Miser

Yes, it's an extremely low risk, much lower than the risk of holding cash in a bank account, since in that case you've lent the bank the money, and you just rank with all the other creditors. Note that we're talking about extremely low, virtually negligible risks here, especially compared to the risk of a fund value halving because of normal market movements.
Yes there is a list somewhere that says you own xxx units (not pounds, the value varies constantly) of the fund.

DennisTenus

Eco_Miser wrote: »

Yes, it's an extremely low risk, much lower than the risk of holding cash in a bank account, since in that case you've lent the bank the money, and you just rank with all the other creditors. Note that we're talking about extremely low, virtually negligible risks here, especially compared to the risk of a fund value halving because of normal market movements.
Yes there is a list somewhere that says you own xxx units (not pounds, the value varies constantly) of the fund.

Ok thanks for clearing that up.

Although interesting what you say about cash in a bank account, I thought 85K per group of banks (that share the same license) is protected?

Do the funds themselves have this list of who owns XXX units?

Eco_Miser

Yes, £85k per group is protected, but as per your question in post #25, I was talking about the risk of having to call on that guarantee.
If the FSCS paid out, they would become creditor of the failed bank in the place of the depositors, and would hope that there would be cash available eventually.

It's likely that the list of who owns how much of the fund is kept by the nominee company, who are shown in the register of shareholders (or unit holders or whatever) as the holder of all the shares held on that platform.
The nominee company is separate from the platform, doesn't trade, and in theory can't go bust, so if the platform ceases trading for any reason the nominee company is still there with all our holdings ready for another platform to come along and run things, or at worst, to register all the holdings directly in the names of the beneficial owners.

ValiantSon

DennisTenus wrote: »

So are you both basically saying that there an EXTREMELY LOW risk of loss or a problem that would require utilising FSCS protection so I should not worry about it as I have 70K+ to invest? And I obviously would prefer to have it in one place. Sounds like the average holding people have in IWeb is probably over 100K?

(I have already allowed plenty in other current accounts for rainy day fund, unemployment, emergencies etc)

So am I actually listed somewhere with each fund I hold that I hold £XXX etc?

I think EcoMiser has done a good job of further answering your concerns. I hope they have allayed your fears. Platforms and banks are really quite different, so it isn't all that helpful to think of them as being alike. If iWeb's fee structure made the best sense for my investments then I wouldn't worry about using them.

Alexland

msallen wrote: »

I'm nearly 2 months into a similar deal at the moment (£220 cb), and have no intention of keeping the moneyfarm account any longer than required to get the cashback, at which point I will sell up and put the proceeds from the (unwrapped) investment there into my regular S&S ISA. Assuming no change in the value of the investments within moneyfarm (even though it's currently up a couple of %) I will see a return equal to >40% AER on the money I put through them.

I feel a bit sorry for Moneyfarm's financial backers but I presume they understood the risk offering such high incentives for trying such an average offering. Just get your money out as soon as the cashback becomes payable.

Alex