Interactive Investor to buy the Share Centre

digannio

So presumably that means the fixed monthly fee for us Share Centre ISA folk will now double from £5 a month to a tenner a month under ii. Oh well, good while it lasted.

SnowMan

digannio said:

So presumably that means the fixed monthly fee for us Share Centre ISA folk will now double from £5 a month to a tenner a month under ii. Oh well, good while it lasted.

The CEO of the Share Centre website, says it will take up to about 6 months, so probably no change during this period

https://www.share.com/stock-markets-and-news/announcement 

From previous Interactive Investor acquisitions expect the charging structure to change to the Interactive Investor structure after this period. But there should be no major barrier to switching to another provider e.g iweb or Halifax share Dealing (not least because Interactive Investor don't have exit charges).

The £5 per month you refer to applies to ISA accounts so let's look at a sole ISA account and how that will be affected on a switch to the Share Centre.

For those on the Frequent Dealing option at Share Centre, I understand the custody charge is £60 (5 x 12) + £96 (4 x 24 frequent dealing quarterly charge) so £156 compared with £119.88 pa at Interactive Investor and Interactive Investor comes with £7.99 per month trade credits, so generally expect a reduction in charges overall.

However best value on the Share Centre I understand (from what I'm told by others using the platform) was to flip between the Standard Dealing and Frequent Dealing option to avoid the hefty 1% dealing charges (on transactions over £750) while avoiding the Frequent Dealing charge most of the time. So for example when selling/buying you would flip to Frequent Dealing, pay the extra £24 custody charge for that quarter and perhaps do all your trades in one quarter of the year, and then flip back to Standard Dealing. So cost at Share Centre on that basis would be £60pa (5 x 12) + 24 + £7.50 per trade dealing charges, =  £84 + £7.50 per trade, if flipping one quarter each year to Frequent Dealing to make your trades. So the break even compared with Interactive Investor is  approximately 5 trades per year (119.88 - 84)/7.50 although it depends when you do these trades in the year.

Without going into detail the SIPP charges compare reasonably on Interactive Investor because the £180 pa custody charge (£15 per month) under the Share Centre, to which the Frequent Dealing charge of £24 per quarter is added (to avoid the 1% dealing cost), is comparable with the £239.88pa at Interactive Investor. Although it depends how often you incur the Frequent Dealing charge amongst other things.

The dealing account (i.e outside SIPP or ISA) has a custody charge of £24pa + frequent dealing charge (of up to £96pa  = 4 x 24) so for the simple someone on Frequent Dealing throughout it is £120pa vs £119.88 at Interactive Investor, and the free trades at Interactive Investor perhaps make them generally cheaper.

And mixed accounts (e.g. SIPP with an ISA) are generally cheaper at Interactive Investor as adding in another cheaper account at Interactive Investor generally comes free, for example SIPP only is custody charge £239.88pa and SIPP + ISA + dealing account is also £239.88pa custody charge.

Share Centre charges may be cheaper in some cases where a dealing account only is held and flipping is used, or for those buying and selling in chunks less than £750 a time, and for a few manufactured scenarios which could occasionally happen in practice.

But to generalise (and ignoring the nuances and interactions including dealing frequencies and timings) Interactive Charges seem from a quick analysis to compare favourably with Share Centre charges

digannio

Thanks for that look at the overall charges (trading and fixed fee). Guess I am just looking at it from a selfish point of view where I just mainly hold a lump of L&G Multi-Index through the Share Centre and let it do its own thing so basically I don't have dealing charges, just the £5 monthly fee, which will double. Twas a bargain for someone like me who wasn't buying and selling.

SnowMan

digannio said:

Thanks for that look at the overall charges (trading and fixed fee). Guess I am just looking at it from a selfish point of view where I just mainly hold a lump of L&G Multi-Index through the Share Centre and let it do its own thing so basically I don't have dealing charges, just the £5 monthly fee, which will double. Twas a bargain for someone like me who wasn't buying and selling.

Have you thought of transferring it (via re-registation) over onto Halifax Sharedealing, or iweb if it's available on there? Halifax Sharedealing is £12.50pa (vs your £60pa currently) if you aren't doing any dealing, and once the transfer to Interactive Investor charges happens it should be free to transfer.

digannio

Last time I checked they didn't offer the L&G Multi Index range.

ColdIron

It seems that iweb do offer both Multi-Index 4 and 5 Acc

digannio

Thanks for that, they must have added it as when I first transferred out of Cavendish into Share Centre they couldn't take it. Now I've got a cheap route, cheers.

masonic

Likely they would be amenable to adding others from the series if there was demand. I imagine that's how the two mentioned became available.

StewD

Wow. Just got the paper work through for the move from Share Centre to Interactive Investor (ii). Seems they don't want to keep customers. Across 2 x Junior ISAs plus 2 funds saving for university we are promised fee increases of over £900 per year. Just wow - 20 years of loyalty clearly means nothing.
And we still have to pay fees to withdraw or move our money elsewhere. Incredible.

bowlhead99

StewD said:

Wow. Just got the paper work through for the move from Share Centre to Interactive Investor (ii). Seems they don't want to keep customers. Across 2 x Junior ISAs plus 2 funds saving for university we are promised fee increases of over £900 per year. Just wow - 20 years of loyalty clearly means nothing.
And we still have to pay fees to withdraw or move our money elsewhere. Incredible.

That does seem extreme, are you sure you have understood the fees?

When looking at ii's free structure recently I saw you could have an account with a platform fee of a tenner a month, and there wouldn't be an extra charge for a JISA; you get some trading credit every month to cover an ad hoc trade and they have recently got rid of the old 'regular investing' charges for recurring purchases on a fixed day each month. So that's £120 a year.  Maybe if you want two accounts and two JISAs it would be £240 a year instead.

How are you getting it to £900 a year, let alone £900 a year more than somewhere else?