S&S ISA Beginner Questions!

AlanP_2

Haveaheart said:

Thanks all - perhaps should have come here first, had read so much and couldn’t make a lot of sense of what these ‘funds’ and various options were, so went ahead and jumped in, and subsequently put the £500 in to see how it all worked... 

I am also looking at a pensions scheme (yes I am a director) but wanted a few variety of options.

Looks like back to the drawing board abs some more reading into some of these recommendations.

best just to leave the £500 invested were it is, or take this out?

I’m not sure I’m able to open another S&S ISA now this year am I? So best to look at the HL options mentioned above?

Leave it in there, it will cost another £12 to sell it.

You can't contribute to a different S&S ISA in this tax year so stick with HL if you want to add to the ISA.

TheAble

dunstonh said:

TheAble said:

Investing in a FTSE 100 tracker is fine btw as a starting gambit. Over the long term you won't go far wrong. But as others have said you want to do it as a unit trust where you won't pay dealing fees.

100% in UK large cap is not a good idea.  The FTSE100 is a weak index to track.  It is too reliant on small number of businesses and is an index that generally focuses more on dividends than it does company growth.  That is held the economy back and investment returns with it.      You could probably excuse 100% UK FTSE all share at a push but its still 100% into UK equity.   The UK is much better at small and medium cap but you would be ignoring the US, Asia, Europe and elsewhere.

Yes I wouldn't advocate only holding the FTSE 100 of course. But it's a fair enough starting point for an initial £500 investment.

fred246

2 - Investing solely in the FTSE100 is poor quality investing.  It's putting your eggs in one basket.

Surely it's putting all your eggs in 100 baskets?

bowlhead99

fred246 said:

2 - Investing solely in the FTSE100 is poor quality investing.  It's putting your eggs in one basket.

Surely it's putting all your eggs in 100 baskets?

Although a quarter of the eggs, by weight, would be in just five of the baskets, and you wouldn't be using any of the thousands of other UK baskets, or any of the tens of thousands of baskets that happened to base themselves anywhere else on the planet. So it's not a very good way of diversifying your egg storage.

bowlhead99

TheAble said:

dunstonh said:

TheAble said:

Investing in a FTSE 100 tracker is fine btw as a starting gambit. Over the long term you won't go far wrong. But as others have said you want to do it as a unit trust where you won't pay dealing fees.

100% in UK large cap is not a good idea.  The FTSE100 is a weak index to track.  It is too reliant on small number of businesses and is an index that generally focuses more on dividends than it does company growth.  That is held the economy back and investment returns with it.      You could probably excuse 100% UK FTSE all share at a push but its still 100% into UK equity.   The UK is much better at small and medium cap but you would be ignoring the US, Asia, Europe and elsewhere.

Yes I wouldn't advocate only holding the FTSE 100 of course. But it's a fair enough starting point for an initial £500 investment.

But at the point that you buy it with the £500 and don't buy anything else with your £500, you are only holding the FTSE100, which is something that you wouldn't advocate.  So it's understandable that people would say it's a poor starting point and the starting point should instead have been a mixed asset or global fund.

TheAble

bowlhead99 said:

TheAble said:

dunstonh said:

TheAble said:

Investing in a FTSE 100 tracker is fine btw as a starting gambit. Over the long term you won't go far wrong. But as others have said you want to do it as a unit trust where you won't pay dealing fees.

100% in UK large cap is not a good idea.  The FTSE100 is a weak index to track.  It is too reliant on small number of businesses and is an index that generally focuses more on dividends than it does company growth.  That is held the economy back and investment returns with it.      You could probably excuse 100% UK FTSE all share at a push but its still 100% into UK equity.   The UK is much better at small and medium cap but you would be ignoring the US, Asia, Europe and elsewhere.

Yes I wouldn't advocate only holding the FTSE 100 of course. But it's a fair enough starting point for an initial £500 investment.

But at the point that you buy it with the £500 and don't buy anything else with your £500, you are only holding the FTSE100, which is something that you wouldn't advocate.  So it's understandable that people would say it's a poor starting point and the starting point should instead have been a mixed asset or global fund.

Well yes but he's bought it now hasn't he.
Given that it's the first £500 of what will hopefully go on in time to be tens or hundreds of thousands it's not exactly something to stress about.

Haveaheart

yes I completely understand what you are all saying – I'll leave the £500 there, no harm really and once I look at other funds, I can potentially top up the FTSE100 as well.

I like the look of the Vangaurd FTSE global all cap, and the idea of monthly payments with no fees. Seem lke a much better starting point to get in the habit of investing i S&S, while I also look at a pension scheme through my business.

I guess I am just keen to commit to something and 'make a move' or another 5 years would pass...

Alexland

If you are going to invest in a Vanguard fund it would be cheaper in the long run to pay the trade fee to get rid of the HSBC ETF and transfer the ISA to Vanguard's own platform that charges 0.15% compared to HL at 0.45% pa.

Haveaheart

Alexland said:

If you are going to invest in a Vanguard fund it would be cheaper in the long run to pay the trade fee to get rid of the HSBC ETF and transfer the ISA to Vanguard's own platform that charges 0.15% compared to HL at 0.45% pa.

I didn’t think I could open another S&S ISA (with vanguard) as I’ve just opened this one? 

Alexland

Haveaheart said:

I didn’t think I could open another S&S ISA (with vanguard) as I’ve just opened this one? 

You are allowed to open the account to ask Vanguard to transfer the ISA cash and assets from HL. However of course they can only transfer assets you can own their platform so would not be able to transfer the HSBC ETF so it would need selling on HL. HL offer much more choice than Vanguard Investor however you pay 3x the price for that choice. Depends what you want really.