Interactive Investor - Regular Investment vs Manual Investment

BigBlueSky

I notice that Interactive Investor only charge £1.50 if you make a regular investment (even though you can set it up to make this investment once and then cancel), vs £10.00 if you just make a manual investment.

My account shows that a regular investment would take place on 20th of the month.

Is there any reason not to make a lump sum investment via the regular investment on 20th March rather than make the same investment manually on the same date ??

The investment would be into a fund.

LHW99

How often would you invest the lump sum? You get the equivalent of a couple of free trades every quarter if that is enough for what you want to do.

BigBlueSky

I have sold off some of my other investments and initially putting around £30K into the fund (around a tenth of my SIPP total). I only have £30 of trading credit remaining but have a lot of others I am wanting to sell off too.

dunstonh

How you want to invest should be your primary objective. You then decide the platform after this. You should not let the platform charges or software dictate how you do things.

If your platform is forcing you to consider other methods then you have the wrong platform.

BigBlueSky

dunstonh wrote: »

How you want to invest should be your primary objective. You then decide the platform after this. You should not let the platform charges or software dictate how you do things.

Thanks for your reply.

I have already decided what I want to invest in and when this will be (as my funds will be available on this particular date). As it just so happens to be on this same date I was just wondering if there was anything I am missing by investing using their cheaper method ?

Obviously if I was wanting to invest straight away the downside is having to wait until the 20th, but as it stands that would be the day I would be investing anyway.

bowlhead99

If you don't use all of the trade credits that you get for paying your quarterly fee, you can roll the unused balance to the next quarter (subject to a maximum cap).

So, even if you have enough credit right now to spend ten pounds on a trade, it makes sense to spend just one pound instead if you can, and then you have nine spare pounds of credit to use on other things that month or future months. Which will be useful if there are a bunch of things you want to sell. By contrast, if you'll never use up your credit or have maxed out your credit at £90, I suppose it doesn't matter because the regular investing version doesn't practically 'save' you any money.

Open ended investments like Funds only have one dealing price per day so if you are generally happy to place the order before 'last orders' on the 20th, it's not like you would be able to get a better price for your units by placing a more expensive manual trade on that date at a specific time of your choice.

I'm no longer with ii apart from one lightly used account that I need to get round to closing. But at AJ Bell Youinvest for example, which offers the choice of regular investing or manual investing, I have frequently put a lump sum in manually, set up 'regular investing' to spend the money, and then turned off regular investing for that investment before the next date comes around because I don't actually want to 'regularly' invest into that asset - I merely want to take advantage of the 'bulk buy' pricing when they trade for lots of their customers at once.

If you are putting in £1000 then it is more acceptable to spend 0.1% of that as a buying cost than to spend 1%.

masonic

BigBlueSky wrote: »

I notice that Interactive Investor only charge £1.50 if you make a regular investment (even though you can set it up to make this investment once and then cancel), vs £10.00 if you just make a manual investment.

It's down to £1 now isn't it? That's what I've been charged when regular investing. I often use this feature for lump sums especially when rebalancing as I can sell just before the regular investment date, but will pay for a full price trade if waiting would introduce a significant delay.

BigBlueSky

bowlhead99 wrote: »

Open ended investments like Funds only have one dealing price per day so if you are generally happy to place the order before 'last orders' on the 20th, it's not like you would be able to get a better price for your units by placing a more expensive manual trade on that date at a specific time of your choice.

Thanks - Yes, I haven't been using my trade credits, but definitely going to use all very soon so looking to keep costs to a minimum.

I hadn't realised that funds have only one price per day. I was thinking maybe I wouldn't get the best price, but in that case I might as well use their regular investment option and then cancel.

BigBlueSky

masonic wrote: »

It's down to £1 now isn't it? That's what I've been charged when regular investing. I often use this feature for lump sums especially when rebalancing as I can sell just before the regular investment date, but will pay for a full price trade if waiting would introduce a significant delay.

Thanks - Yes, I think you are right (I'm not sure when it dropped to £1). I have some other funds to sell on II - Do you happen to know how long they take to sell to have the funds available ? - The one I sold recently seemed to take around 3 days (not sure if this is normal).

MallyGirl

3 days sounds about right. It takes a bit longer for the paperwork to be loaded to the system.

BigBlueSky

MallyGirl wrote: »

3 days sounds about right. It takes a bit longer for the paperwork to be loaded to the system.

Thanks. Just wondering if I sold some other funds off today whether the cash would be available for 20th.