Low cost platform for S&S ISA: Vanguard vs Freetrade

Copperbark

I'm considering low-cost stocks and shares ISA platforms, Vanguard and Freetrade in particular. 
I know they're different beasts (more on that in a bit).

But at a basic level, I wanted to check my logic on cost comparison: with Vanguard charging 0.15% platform fees and Freetrade £36 a year (£3/month), I make it that the breakeven is £24k invested (£36/0.15%=£24k)  Below that, Vanguard is cheaper and above it you're better off with Freetrade.  Does that look right?

Now the other considerations are cost to trade and the fact that you can only hold Vanguard products on them as a platform.  Personally those aren't big concerns for me as I'm looking (at most) at monthly purchases of low-cost ETFs (which Vanguard do a good job of).  But the fact that Freetrade would allow instant trades for free rather than "next trade point" with Vanguard would be attractive.  What else is there to consider?  I'm sure I've missed something ... 

And if anyone knows of other platforms that would challenge these two for low cost, I'd be interested to hear.

Albermarle

Compared to how well your investments perform , these small differences in platform fees are peanuts .
For example you buy a low cost ETF on a low cost platform and maybe pay 0.25% in total as as opposed to say 0.35% on another one . Most ETF's are quite volatile and could easily gain or lose 20% in a week in turbulent market conditions.

A_T

Trading212 has no platform fees for it's ISA

Froggitt2

Why not look at iWeb? £25 up front, but no fees ongoing.

A_T

Froggitt2 said:

Why not look at iWeb? £25 up front, but no fees ongoing.

except £5 for every trade

Aceace

Some trades on vanguard are instant. I don't know what determinator is, but I've bought and sold VWRL with instant prices, whereas buying and selling their Life Strategy funds was on a next trading point basis. 

Alistair31

Aceace said:

Some trades on vanguard are instant. I don't know what determinator is, but I've bought and sold VWRL with instant prices, whereas buying and selling their Life Strategy funds was on a next trading point basis. 

ETF’s are traded instantly, funds are not.

Swipe

Aceace said:

Some trades on vanguard are instant. I don't know what determinator is, but I've bought and sold VWRL with instant prices, whereas buying and selling their Life Strategy funds was on a next trading point basis. 

You pay a £7.50 fee for real time trading of ETFs on the Vanguard Investor platform, otherwise next trading point is free. Make sure you select the correct option when buying.

Copperbark

Swipe said:

You pay a £7.50 fee for real time trading of ETFs on the Vanguard Investor platform, otherwise next trading point is free. Make sure you select the correct option when buying.

Yep. That's what I was referring to with

Copperbark said:

But the fact that Freetrade would allow instant trades for free rather than "next trade point" with Vanguard would be attractive.

i.e., not that you can't trade ETFs instantly on Vanguard but that there's a fee which there isn't for instant trades on Freetrade (including for Vanguard ETFs). Not essential for what I'm planning but nice to know that I could trade instantly without cost.

Thrugelmir

Copperbark said:

Swipe said:

You pay a £7.50 fee for real time trading of ETFs on the Vanguard Investor platform, otherwise next trading point is free. Make sure you select the correct option when buying.

Yep. That's what I was referring to with

Copperbark said:

But the fact that Freetrade would allow instant trades for free rather than "next trade point" with Vanguard would be attractive.

 Not essential for what I'm planning but nice to know that I could trade instantly without cost.

There's no such thing as a free lunch. Operating costs have to be paid for. Likewise the investors behind the operation will be looking to make a profit. 

Copperbark

Thrugelmir said:
There's no such thing as a free lunch. Operating costs have to be paid for. Likewise the investors behind the operation will be looking to make a profit. 

What are you implying?  That you don't believe they will continue that pricing model?

Being free to trade instantly doesn't mean they're not charging for anything (e.g., I've already said they charge £3/month for an ISA in my original post).  If I was being a bit more precise, perhaps I could have said that there's no extra cost for instant trades at Freetrade (where there is at Vanguard).  But if you don't have an ISA, it would be true that it is completely free to the user.  Even that doesn't mean they can't make money on your business in other ways that you don't see e.g., I believe Robinhood in the US - who run a similar pricing model - make money on investors' uninvested deposits among other things.

A similar thing happens with card transactions, that I only found out about recently.  I would never say that it costs me to spend on my debit card.  It's free.  I only pay for the cost of whatever I'm buying and there are no additional fees.  I'm not being charged extra by either the merchant or my bank for using a card compared to if I'd handed over cash.  But banks still make money on "interchange" with every card transaction I make.  Free to the user, but the bank makes money from my activity.