In specie or cash

brutha

I'm transferring a SIPP and was wondering if there is a preferred method amongst members here.

I am aware of the 'being out of the market' issue when transferring in cash, but was wondering if there are other considerations.


I'd appreciate your opinions.
Thank you.

Alexland

I like to keep my investment accounts simple without too many holdings and always prefer in specie as I don't like the almost random gain or loss that comes from being out the market for however long the transfer takes. If the account valuation was really small then it would be less of a concern.

If transferring in specie make sure you are already holding an asset that the new platform can accept and enough cash in the account to keep paying the custody fees and any exit and/or transfer fees that may apply. Try and stop any regular SIPP contributions plenty in advance as the lag on the tax relief will cause the account to be open for longer.

Alex

SonOf

cash transfers are quick but out of the market for 3-4 days. In-specie transfers can take upto 6 months and you cannot transact on a fund whilst an in-specie transfer is taking place. Sometimes they are quicker but it really depends on the fund house (the fund house is nearly always the cause of the delay. Some are quick, some are slow).

lpgm

It's a shame everyone uses the Latin phrase 'in specie'.

bowlhead99

lpgm wrote: »

It's a shame everyone uses the Latin phrase 'in specie'.

Well, corporate lawyers like a bit of Latin when documenting investment transactions, and have been doing it for a very long time.

I don't have a problem with it per se.

eastofeden

As long as it doesn’t done in an ad hoc manner.

cattie

I'm in process of transferring a s&s ISA, not a SIPP in specie & to date it's 3 months since beginning the transfer & still not completed. Transferring a couple of cash ISA's into the s&s one on the new platform has taken just a couple of weeks.

I'd say as long as you can be patient, go for the in specie.

aroominyork

Alexland wrote: »

If transferring in specie make sure you are already holding an asset that the new platform can accept and enough cash in the account to keep paying the custody fees and any exit and/or transfer fees that may apply. Try and stop any regular SIPP contributions plenty in advance as the lag on the tax relief will cause the account to be open for longer.

I hope you don't mind me clarifying, Alex.

You need to check that the specific class of your asset is held by the platform you are moving to. For example, when moving from HL to ii last year one of my funds was Lindsell Train UK Equity. The discounted D class which HL offers is not available on ii so the transfer was rejected, I had to sell the D class on HL and buy the regular class before the transfer could be attempted again, and the whole process was delayed.

Alexland

Yes I should have mentioned the fund class matters too.

Although I don't like the uncertainty of being out the market for short periods of time I was switching a fund and so our ISAs were in cash yesterday when markets temporarily dropped before buying into the new fund at a better price overnight.

Alex

RSNut

As long as you maintain the 'quid pro quo' does it matter?

brutha

Ok then, on this occasion, I'll go In specie.

Thanks all for your input.