Safe investing?

pledgeX

Having recently seen threads around SVS and Woodford, it's got me a bit paranoid about what could happen to my savings.

I've currently got a stocks and shares ISA with Hargreaves and Landsdown. It's got a couple of index tracker funds, and a vanguard lifestrategy fund.

I'm well below the 85k FSCS level currently, but I'm still wary that my money could be trapped/lost somehow even if the index it's tracking is unaffected. Am I worrying unnecessarily?

How do people with more than 85k stay 'safe'? Do they spread the money across multiple providers?

Linton

pledgeX wrote: »

Having recently seen threads around SVS and Woodford, it's got me a bit paranoid about what could happen to my savings.

I've currently got a stocks and shares ISA with Hargreaves and Landsdown. It's got a couple of index tracker funds, and a vanguard lifestrategy fund.

I'm well below the 85k FSCS level currently, but I'm still wary that my money could be trapped/lost somehow even if the index it's tracking is unaffected. Am I worrying unnecessarily?

How do people with more than 85k stay 'safe'? Do they spread the money across multiple providers?

Many people on this forum including myself have more than £85K on individual platforms. Both SVC and Woodford are irrelevent to your concerns as their falls are unlikely to concern the FSCS. In neither case does there seem any suggestion that money has been stolen. Value has decreased with Woodford but FSCS does not cover you for investment losses unless they can be shown to have arisen from bad regulated advice.


The key point is that with the banks any money you deposit belongs to the bank and can be used to pay the banks debts. Without FSCS, you merely hold the bank's promise to repay you on request, which may be of little value should the bank go bust. With platforms and funds you continue to own your investments. Your money cannot be used to pay a plaform's or fund managers debts.


I believe the only real risk is that should a platform or fund manager go bust it could take some time for the mess to be sorted out. But I dont believe the FSCS will compensate you for that. So for large holdings it may be sensible to use more than one platform. Between MrsL and myself we hold funds on 3 platforms one of which will be going in the next 2-3 years when a SIPP is exhausted.

DrSyn

While not necessary for the amount you quote, if it make you happier, use 2 or 3 platforms backed by large companies, two such examples are iWeb or HSBC Global Investment Centre etc.

bostonerimus

VLS and index trackers have strict allocation rules and invest in companies or bonds sold in major markets, so you don't have the same risk, as in the Woodford funds, of the hubris of an active manager who invests in small unlisted companies. Your investments just have the usual market ups and downs risks.

capital0ne

How do people feel about II - Interactive Investing? Time to move maybe?

Alexland

capital0ne wrote: »

How do people feel about II - Interactive Investing? Time to move maybe?

I don't feel confident enough about II as a loss making company (similar to Nutmeg) to invest with them but they are in expansion mode (acquiring TD and AST) so they must have some confidence in their own business once they get enough scale. They also must have done some maths on the latest price hike to determine that it would have a net positive effect on their margins. II are backed by JC Flowers private equity but are somewhere near the bottom of their list.

https://www.jcfco.com/our-investments/

AnotherJoe

capital0ne wrote: »

How do people feel about II - Interactive Investing? Time to move maybe?

Time to move to or from ?

bostonerimus

If you use a mainstream platform I don’t think you should worry too much. Even if H&L were to go bust you’d still own the funds in your account. The bigger issue folks should worry about is excessive fees and panic selling as they are far more likely to put your pot in danger.

pledgeX

bostonerimus wrote: »

If you use a mainstream platform I don’t think you should worry too much. Even if H&L were to go bust you’d still own the funds in your account.

In that scenario, how would you be able to prove what was in your account? Assuming their website was taken down. You might have a statement that was a year or two old, but I very rarely check on the values of my funds.

ChopperST

pledgeX wrote: »

In that scenario, how would you be able to prove what was in your account? Assuming their website was taken down. You might have a statement that was a year or two old, but I very rarely check on the values of my funds.

You would presumably know the number of units held and could work the price from there. Everytime you place a new order or re-balance it makes sense to make a note in a spreadsheet if you don't already.

capital0ne

AnotherJoe wrote: »

Time to move to or from ?

Re: “
How do people feel about II - Interactive Investing? Time to move maybe?

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