Scottish Mortgage Investment Trust

Thrugelmir

0.36% will be operational costs of the fund. This will exclude transactional costs such as the cost of buying/selling securities, financing costs etc. 

Chino

Thrugelmir said:

0.36% will be operational costs of the fund. This will exclude transactional costs such as the cost of buying/selling securities, financing costs etc. 

No. The 0.36% figure will include the "transactional costs such as the cost of buying/selling securities, financing costs etc.", those being a component of the cost of running an investment company.
The point that people are missing is that the 0.36% figure is the position as of 31 March 2020 whereas HL's 0.69% figure relates to the position as of 10 December 2020:
https://documents.feprecisionplus.com/PRIIP/BAGI/PRP/BAIEPT_BE08_en-GB.pdf

Rollinghome

The charging is particularly confusing for ITs and you'll find different figures in the Key Information Document (the KID )that all ITs must provide, and the figures given by the AIC, the trade body which are lower. 

The AIC give two figures, The ongoing charge (OCF) and the OCF plus any performance fee.  They gve the OCF for SMT as 0.36% and show what that figure means here https://www.theaic.co.uk/financial-advisers/guides/fees-charges-and-other-costs .  It does not include transaction or gearing costs.

The KID document gives the ongoing costs as:

Portfolio transaction costs - 0.10%

The impact of the costs of us buying and selling underlying investments for the product.

Other ongoing costs - 0.69%

The impact of the management fee payable to the Trust's investmentmanager (0.31%), the Trust's other administrative expenses (0.06%), the costs of borrowing money to invest, including interest and arrangement fees(0.31%) but not any income or capital benefit of doing so and the ongoingcosts of any underlying investments in funds within the Trust's portfolio(0.01%).

So 0.79% together. On top of that will be your platform's dealing charge,  SDRT (stamp duty), the market maker's spread, plus any ongoing platform charge.

Thrugelmir

noh said:

dekkard said:

underground99 said:

dekkard said:

Those who invested in Scottish Mortgage on Freetrade - have you incurred any unexpected fees? Judging by earlier comments there shouldn't be any, but just curious.

I've had an account with freetrade for a while. I don't hold SMT through them, but it's available. There are never any 'unexpected' fees.

Thanks. Freetrade shows the ongoing charges for SMT are 0.69%. Hargreaves Lansdown shows the ongoing charges as 0.36%. Am I missing something or is Freetrade charging more?

HL also list the net ongoing charge as 0.69%. Go to the costs tab and then expand the investment charges.
https://www.hl.co.uk/shares/shares-search-results/s/scottish-mortgage-it-plc-ordinary-shares-5p/costs

SMT are quoting 0.36% on their February 2021 factsheet. Year end isn't until 31st March 2021 so this years % isn't yet quantifiable. 

underground99

Chino said:

Thrugelmir said:

0.36% will be operational costs of the fund. This will exclude transactional costs such as the cost of buying/selling securities, financing costs etc. 

No. The 0.36% figure will include the "transactional costs such as the cost of buying/selling securities, financing costs etc.", those being a component of the cost of running an investment company.

No, that's simply not the case. The Ongoing Cost Figure is an industry standard measurement. It does not include transaction costs (0.1% in SMT's case) as they're not a P%L expense item for an investment company and in any case there may not be any transactions; and it doesn't include interest on borrowings or finance arrangement fees (0.31% in SMT's case last year) as such costs depend on the level of borrowings, which may be variable.

The point that people are missing is that the 0.36% figure is the position as of 31 March 2020 whereas HL's 0.69% figure relates to the position as of 10 December 2020:

Simply the 0.36-0.38ish % figure is the ongoing charges figure which may change a little from time to time, but the figure used in the KID document follows certain requirements and includes the borrowing costs of 0.31, bumping it up to the 0.69% level.