AJ Bell raising cap on shares custody charge

Alexland

masonic said:

Alexland said:

Alistair31 said:

If so I need a cheaper home for my LISA which has ~£22k in VWRP ETF, anyone ? 

EQi investing in HSBC FTSE All World fund would be a cheaper platform and investment choice.

Interesting option, although it looks like the 0.2% custody fee is uncapped, so it is outright cheaper for less then £21k, but more expensive above that unless you can pick a cheaper fund or funds to hold within it, in which case the threshold at which AJ Bell becomes cheaper will be somewhat higher.

EQi cap their 0.20% LISA at £10 per quarter which is now cheaper than AJ Bell's new capping at £3.50 pm. Plus the capping seems to include funds for which there is no trade fee at EQi.

masonic

Alexland said:

masonic said:

Alexland said:

Alistair31 said:

If so I need a cheaper home for my LISA which has ~£22k in VWRP ETF, anyone ? 

EQi investing in HSBC FTSE All World fund would be a cheaper platform and investment choice.

Interesting option, although it looks like the 0.2% custody fee is uncapped, so it is outright cheaper for less then £21k, but more expensive above that unless you can pick a cheaper fund or funds to hold within it, in which case the threshold at which AJ Bell becomes cheaper will be somewhat higher.

EQi cap their 0.20% LISA at £10 per quarter which is now cheaper than AJ Bell's new capping at £3.50 pm. Plus the capping seems to include funds for which there is no trade fee at EQi.

Thanks, so £2 a year cheaper above the respective caps, plus a potential saving of £1.50 on trade fee (compared with the regular investing price, £3 per year if you invest £4k then the £1k bonus separately).

Alexland

masonic said:

Thanks, so £2 a year cheaper above the respective caps, plus a potential saving of £1.50 on trade fee (compared with the regular investing price, £3 per year if you invest £4k then the £1k bonus separately).

Yup but the main saving for Alistair31, if I am understanding EQi's charges correctly, would be on holding the better performing / cheaper HSBC fund which tracks the same index and also has FSCS protection. Still it would require a couple of trades so with time out of the market changing might be a bigger impact than several years of fee savings.

masonic

Alexland said:

masonic said:

Thanks, so £2 a year cheaper above the respective caps, plus a potential saving of £1.50 on trade fee (compared with the regular investing price, £3 per year if you invest £4k then the £1k bonus separately).

Yup but the main saving for Alistair31, if I am understanding EQi's charges correctly, would be on holding the better performing / cheaper HSBC fund which tracks the same index and also has FSCS protection. Still it would require a couple of trades so with time out of the market changing might be a bigger impact than several years of fee savings.

Yes, I was mainly thinking through for myself, as it appears that EQi just might accept a LISA transfer request from someone over the age of 40. But I won't find a cheaper equivalent fund for the ETF I hold, and it would take a considerably more substantial saving to tempt me to move.

Presuming enough cash was available to do it, the time out of the market could be eliminated by buying and selling the destination fund in the Dealing account, though that does introduce the potential headache of a small capital gain. Might be worthwhile given the general delays being experienced with ISA transfers due to Covid.

Alexland

masonic said:

Yes, I was mainly thinking through for myself, as it appears that EQi just might accept a LISA transfer request from someone over the age of 40. But I won't find a cheaper equivalent fund for the ETF I hold, and it would take a considerably more substantial saving to tempt me to move.

We had someone in the ISA sub-forum recently over 40 who approached EQi and was told that they wouldn't transfer a LISA for someone over 40. We are happy with AJ Bell and, having already moved our LISAs via Nutmeg and HL over the past 3.5 years, are not sufficiently motivated by this change to move to EQi but we are only investing in LCWL. If we wanted the EM exposure (we get it via our workplace pensions) it would be more worth is as VWRL/VWRP is expensive compared to the HSBC fund which has performed better.

masonic said:

Presuming enough cash was available to do it, the time out of the market could be eliminated by buying and selling the destination fund in the Dealing account, though that does introduce the potential headache of a small capital gain. Might be worthwhile given the general delays being experienced with ISA transfers due to Covid.

I wasn't saying EQi wouldn't do an inspecie transfer but just that selling an ETF and buying a fund has some time out of the market while normal fund dealing occurs.

hoc

The 40% increase on ISA fees is neither merited nor justifiable given the competition. This must be based on their calculated assumption customers with other accounts will retain their ISA with them for simplicity as in just a few years they've almost completed the transition from competitive with the cheapest to marginally cheaper than the big expensive names. It's "just a few more pounds" each year until it isn't because at a certain point if paying a premium people will expect a premium service and product.

In many cases combinations like an ISA with iweb and a SIPP with II will do the same job for cheaper. At this rate Youinvest will become more expensive than HL soon.

masonic

Alexland said:

masonic said:

Presuming enough cash was available to do it, the time out of the market could be eliminated by buying and selling the destination fund in the Dealing account, though that does introduce the potential headache of a small capital gain. Might be worthwhile given the general delays being experienced with ISA transfers due to Covid.

I wasn't saying EQi wouldn't do an inspecie transfer but just that selling an ETF and buying a fund has some time out of the market while normal fund dealing occurs.

EQi do not do in specie transfers. I read through their LISA transfer form and it states you must sell your investments and transfer in cash.

bowlhead99

hoc said:

The 40% increase on ISA fees is neither merited nor justifiable given the competition. This must be based on their calculated assumption customers with other accounts will retain their ISA with them for simplicity as in just a few years they've almost completed the transition from competitive with the cheapest to marginally cheaper than the big expensive names. It's "just a few more pounds" each year until it isn't because at a certain point if paying a premium people will expect a premium service and product.

The proof of that is whether customers abandon them and new customers stop signing up. Otherwise, the costs are 'justifiable' considering what other firms want to charge for services. Every fee increase or structure change that a provider brings in is going to be one that they have given some thought to, in terms of what can get them the money they need for the desired level of profit without alienating too many of the customer types that they want.   The £20 extra from the higher cap now being used on the pension (only if it holds £48k+ of exchange-traded assets) is under 0.05% a year on £50k and 0.01% on a £250k portfolio of that type of asset. 

As you say, it's 'just a few more pounds' that won't make me rethink my strategy or move.  For me, the product is a premium one to IWeb while not being a more expensive pension product than e.g. ii for holding shares / exchange-traded stuff. A mix of 'transaction fees and percentage based'  will still be fine for investors who don't want to pay bigger percentages on lots of assets but don't have such a big portfolio with the particular asset types that make 'high fixed fees' at II a good solution compared to AJ Bell's.

In many cases combinations like an ISA with iweb and a SIPP with II will do the same job for cheaper. At this rate Youinvest will become more expensive than HL soon.

I'm sure the spirit of MSE is that it can always be cheaper to shop around in multiple places to build your own package of goods and services. I can get a cheaper deal on my weekly shop and same or better quality by parking and queuing in turn at Asda, Morrisons, Waitrose, and a greengrocer; or I could go just go to my nearby Tesco Extra and get everything from one place and not mind that it is a little more expensive than the best I could do. 

For me, ii may be be more expensive for the pension given they want £240+ a year for it rather than Youinvest wanting £120 plus transaction fees, but of course everyone has a different profile of assets. IWeb don't have the same range of funds offered by Youinvest nor cover as many foreign stock exchanges for international stocks, so I wouldn't use them for my ISA, while they'll be fine for many of course.

Alexland

masonic said:

EQi do not do in specie transfers. I read through their LISA transfer form and it states you must sell your investments and transfer in cash.

In which case we will stick with AJ Bell for our LISAs as the time out of the market could be much more valuable (either way) than the small saving in platform fees. We are now at the point where the investment gains are about the same value as the government bonus which is satisfying.

Chickereeeee

Doesnt anybody else find monthly fees, as opposed to quarterly, annoying? I am not hyper-anal abouts such things, but like my (MSMoney) records to reflect the cash balance in the accounts. It will be three times the the work to enter monthly transactions.