Basic question re AJ Bell YouInvest Regular Investments

hallmark

Not asking for myself & I have no experience of these so not sure the answer: A pal has an AJ Bell ISA funded with £50 and a £50 DD for the 1st of each month.  They also setup a regular investment in VHYL for£50/month.  They've just logged and that didn't happen as it should have on the 10th, not sure why.

I can think of possible reasons but I don't know how AJ Bell works:

1. The account balance was £50 and the regular investment was for £50. As there's a £1.50 dealing charge should the investment amount have been a max of £48.50? (The assumption was that the dealing charge would be taken out of the £50 but maybe that was incorrect).

2. VHYL actually trades around £49 for one unit meaning one unit + £1.50 dealing charge would cost slightly more than the account balance of £50. I'm not sure how it works with a fund like VHYL, whether it's allowed to buy "£48.50 worth" or whether it has to be a minimum of a unit.


Many thanks if anybody knows what the problem would have been.

masonic

It will be because the amount invested was insufficient to buy 1 share. You cannot trade fractional shares.

george4064

If the regular investment failed (for whatever reason) your pal should've received a message from AJ Bell explaining why.

eskbanker

Perhaps a bit of a side issue but, even if adjusting the setup slightly to accommodate a unit price only slightly below the monthly contribution, it doesn't seem particularly efficient to be buying single fund units every month for a premium of over 3%!  Buying something a bit different, or the same thing less frequently or via another platform, may be worth considering, to avoid too much dilution of returns....

Alexland

For modest amounts like £50 per month your pal could invest in one of AJ Bell's own funds which have no charge to buy and can be held in fractional units.

https://www.youinvest.co.uk/investment-ideas/ajbell-funds

Also they will need to maintain a suitable account cash balance to pay the 0.25% ongoing account charges unless they have arranged with AJ Bell for it to be paid from a seperate unwrapped dealing account.