Different Investing Platform

GeoffTF

maxsteam said:

Yes. HL are more expensive than some other platforms but HL are a full member of the London Stock Exchange. Freetrade are "a non-trading member firm of the London Stock Exchange" with "no direct access to the Exchange's markets".

Does that matter? I expect that both HL and Freetrade execute trades via market makers, rather than directly with the exchange.

barnstar2077

You may want to investigate Vanguard's FTSE Global All Cap Index accumulation fund on Vanguards own platform.

maxsteam

GeoffTF said:

maxsteam said:

Yes. HL are more expensive than some other platforms but HL are a full member of the London Stock Exchange. Freetrade are "a non-trading member firm of the London Stock Exchange" with "no direct access to the Exchange's markets".

Does that matter? I expect that both HL and Freetrade execute trades via market makers, rather than directly with the exchange.

The Freetrade.io platform does not have access to accurate prices. They provide "indicative" prices, often rounded to the nearest penny while other platforms are giving prices accurate to 0.05p, for example. Unlike most mainstream platforms, you don't find out the price until after you have traded with Freetrade.io.

Btw, there are market makers who are part of stock exchanges.

wmb194

maxsteam said:

GeoffTF said:

maxsteam said:

Yes. HL are more expensive than some other platforms but HL are a full member of the London Stock Exchange. Freetrade are "a non-trading member firm of the London Stock Exchange" with "no direct access to the Exchange's markets".

Does that matter? I expect that both HL and Freetrade execute trades via market makers, rather than directly with the exchange.

The Freetrade.io platform does not have access to accurate prices. They provide "indicative" prices, often rounded to the nearest penny while other platforms are giving prices accurate to 0.05p, for example. Unlike most mainstream platforms, you don't find out the price until after you have traded with Freetrade.io.

Btw, there are market makers who are part of stock exchanges.

This is just a general criticism of the way it displays data and the choice it has been made to trade at best, not an argument in itself as to whether being a full member of the stock exchange matters or not.

Btw, it isn't named, "Freetrade.io" it's just Freetrade. ".io" is just the trendy domain for technology companies.

GeoffTF

Here are the benefits of membership for a broker:

https://www.londonstockexchange.com/trade/membership

No doubt there are costs too. The broker does not have to be a member to trade via market makers. The market makers will have to provide quotes, but Freetrade has chosen not to display them to the user.

The cheapest option for the OP is Invest Engine. Indeed, they will pay him to open an account. Invest Engine is a new kid on the block, whereas Freetrade has been around for over five years. Freetrade claims to have over a million accounts and over a £ billion in Assets Under Management. I do not have a Freetrade account, but it is a sensible option for the OP.

Alexland

GeoffTF said:

The cheapest option for the OP is Invest Engine.

Yes something like Vanguard Dev World VEVE in an InvestEngine S&S ISA would only be 0.12% total however if the OP is ploughing £1k per month it will soon be enough money that they might put a value on holding their assets somewhere with a proven business model who are less likely to go into a long special administration and asset recovery process. I did a tiny amount into Invest Engine for the signup incentives but I'd rather pay a modest platform fee such as Vanguard Investor at 0.15% to go with an established reputable provider for my main accounts. Once the accounts get big enough moving onto capped or fixed charges the platform costs are negligible.

GeoffTF said:

Freetrade claims to have over a million accounts and over a £ billion in Assets Under Management. I do not have a Freetrade account, but it is a sensible option for the OP.

At £3 per month for a Freetrade ISA then it would be cheaper to go with Vanguard Investor until they have £24k. It's yet to be seen if Freetrade can build a business on the proportion of customers who are happy to pay subscription charges but with that value of AUM they are more likely to be taken over by someone than outright fail.

GeoffTF

Alexland said:

GeoffTF said:

The cheapest option for the OP is Invest Engine.

Yes something like Vanguard Dev World VEVE in an InvestEngine S&S ISA would only be 0.12% total however if the OP is ploughing £1k per month it will soon be enough money that they might put a value on holding their assets somewhere with a proven business model who are less likely to go into a long special administration and asset recovery process. I did a tiny amount into Invest Engine for the signup incentives but I'd rather pay a modest platform fee such as Vanguard Investor at 0.15% to go with an established reputable provider for my main accounts. Once the accounts get big enough moving onto capped or fixed charges the platform costs are negligible.

GeoffTF said:

Freetrade claims to have over a million accounts and over a £ billion in Assets Under Management. I do not have a Freetrade account, but it is a sensible option for the OP.

At £3 per month for a Freetrade ISA then it would be cheaper to go with Vanguard Investor until they have £24k. It's yet to be seen if Freetrade can build a business on the proportion of customers who are happy to pay subscription charges but with that value of AUM they are more likely to be taken over by someone than outright fail.

We do not know how much money the OP already has with HL. Unless, he already has a large sum invested, he will be fully covered by the FSCS, and does not have to worry about finding the safest broker.

"A long special administration and asset recovery process" should not be a big problem for him if he is investing £1K per month. He can just switch his new money to a different provider, and instruct the administrators to transfer over his old account when they have sorted everything out. If the OP does have a problem with that, he should not be invested in 100% equities.

The OP may already be near the break even point with Vanguard vs Freetrade. Vanguard is certainly a sensible option, but will soon become very expensive for him, unless Vanguard reduces its charges.

barnstar2077

I'm with Alexland on this one.   Better to pay 0.15 and sleep at night. 

AAZ

Many thanks everyone for advice, I will look into vangaurd and free trade.

GeoffTF

Just for the fun of it, I thought I would compare the cost of using Vanguard's platform to buy an ETF in an ISA each month with that of using Fidelity's platform. Fidelity is Vanguard's old rival. For Fidelity the platform fee is a maximum of £45 p.a. Regular savings or withdrawal costs £1.50 per transaction. That is a total of £45 + 12 * £1.50 = £63 for twelve transactions. Break even with Vanguard's 0.15% is £42,000. For a portfolio of £250,000 Vanguard charges £375, which is nearly 6 times what Fidelity charges. That is bonkers. Nonetheless, it has to be said that Vanguard's platform is growing rapidly, both in terms of its number of users and its AUM.