Fund Dealing?

sparky0138

I'm trying to compare various platforms. If a platform charges for fund dealing (e.g. £9.99) what exactly does that mean please?

I've tried Google but I'm not having much luck.

eskbanker

It's the fee you pay every time you trade, i.e. buying or selling.

MarkCarnage

On top of that, you will have stamp duty of 0.5% for purchasing UK shares. This will apply across whatever platform you choose. Only applies to purchases, not sales.

bowlhead99

MarkCarnage wrote: »

On top of that, you will have stamp duty of 0.5% for purchasing UK shares. This will apply across whatever platform you choose. Only applies to purchases, not sales.

This is probably only going to add to the confusion because per the OP, the charge being queried was for 'fund dealing'.

Stamp duty does not apply to buying shares in 'funds' which are open ended investment companies or unit trusts; only to buying shares in individual UK companies / investment trusts bought on the stock exchange...

MarkCarnage

True - hadn't spotted that it referred only to funds. Though the stamp costs are effectively embedded in the fund charges so you still pay them.

bowlhead99

MarkCarnage wrote: »

True - hadn't spotted that it referred only to funds. Though the stamp costs are effectively embedded in the fund charges so you still pay them.

Well, someone else might be leaving the fund at the same time as you are joining it, in which case the fund doesn't need to buy any more assets as a result of your investment, so it doesn't need to pay 0.5% stamp duties, and even if it did, the cost would be shared between all the other investors in the fund

sparky0138

Yes, it would be for a fund like VLS. So if a direct debit was set up for regular investing, there would be a one-off charge of £9.99 each time?

What about re-balancing? I think I'm correct in saying Vanguard is automatic but each time it's done or if bought and then re-balanced through another platform, would it be a one-off charge then as well?

And what about the initial lump sum investment?

I guess what I'm trying to find out is if there will be any instances where there might be multiple charges.

Prism

If a platform charges £9.99 each time you deal in a fund and you are planning on contributing monthly then don't use that platform. There are others that don't charge at all for this or charge much less

eskbanker

Prism wrote: »

If a platform charges £9.99 each time you deal in a fund and you are planning on contributing monthly then don't use that platform. There are others that don't charge at all for this or charge much less

^ This.

There are a number of tools available that allow you to model which platforms are most cost-effective for your planned investment assets, values and frequencies, so plug your numbers into the likes of:

http://monevator.com/compare-the-brokers/
http://www.comparefundplatforms.com/
https://forums.moneysavingexpert.com/discussion/5583030

AnotherJoe

sparky0138 wrote: »

I'm trying to compare various platforms. If a platform charges for fund dealing (e.g. £9.99) what exactly does that mean please?

It means you should use a different platform.

Alexland

For a low value VLS in ISA account consider Vanguard Investor who don't charge for fund trading and have a low 0.15% pa custody fee. For a higher value account with regular investments consider Halifax Share Dealing ar £12.50 pa plus £2 per regular trade.