iWeb ISA platform - charges?

sairy.gamp

I have opened an ISA account with iWeb to invest in funds. Paid the £25 application fee and understand it is a fiver per trade in funds. I know an initial charge is (sometimes) applicable and, when charged, can be at times discounted too. I realise also there are ongoing charges (OCF) from the fund manager as well. But, to my surprise, the iWeb site also says:
"Typical transaction cost: 0.5% of your investment (you'll be provided with the exact cost before investing in a fund)".
If you are already paying the initial charge and committing to the OCF, can anyone tell me if this 0.5% is in addition to the OCF figure for the fund? Is it going to iWeb or the fund manager? HL is looking a bit cheaper with their 0.45% platform charge to me now (i know this is per annum).
'Confused of Blighty'
P.S. I tried in vain to get a 'livechat' on iWeb for yonks.

MaxiRobriguez

Stamp duty...

eskbanker

MaxiRobriguez said:

Stamp duty...

No, it's referring to the internal transaction costs within funds - as such it's not an incremental cost that the investor pays and is the same across all platforms, even though they tend to represent it differently, if at all.

sairy.gamp

Thanks EB. Believing iWeb to be cheaper than HL, I went cold when i saw it. 
Mind you, iWEb are stating an OCF cost of 1.98% (+£5) on Liontrust Russia C - HL is only 1.025% (+0.45% P.A. !). No initial charge with either platform. It pays to shop and calculate.
Maxi, you dont pay stamp duty on funds - it is for share purchases. Thanks anyway.

MaxiRobriguez

That'll teach me to read a post fully before commenting.

eskbanker

MaxiRobriguez said:

That'll teach me to read a post fully before commenting.

I knew to pick you up on it as I made exactly the same mistake on another thread a while ago - the 0.5% figure is an unfortunate coincidence!

EdSwippet

sairy.gamp said:

Mind you, iWEb are stating an OCF cost of 1.98% (+£5) on Liontrust Russia C - HL is only 1.025% (+0.45% P.A. !). No initial charge with either platform.

The information shown on the iWeb site might be incorrect for this fund; specifically, it seems to be showing the Class A OCF, not the Class C one. From the fund's KIID:

Ongoing charges
Classes A Acc GBP, A Acc USD: 1.98%
Classes C Acc EUR, C Acc GBP: 1.03%
Class C Acc USD: 1.04%

I'd probably check the charges directly with iWeb. It's rare that HL comes out cheaper than iWeb (or than anyone, really!) for fund holdings. HL have negotiated special discounts on some funds, but their 0.45% platform charge nearly always more than negates the discounts.

2unlimited91

Since both platforms seem to have the same class of the fund (C Acc), the fund itself will cost the same on both platforms.

Except that HL say they have negotiated a cash rebate ("loyalty bonus") of 0.025%. That will partially offset HL's own holding charges of 0.45%, making the effective cost of holding the fund with HL 0.425%.

So with HL, you will pay the OCF (whatever that turns out to be) + 0.425% per year.

And with IWeb, you will pay the same OCF per year, and also £5 for every purchase or sale.