Platform Charges - ETFs vs OEICs

Qyburn

Hi,
Just something I keep wondering. Across most platforms, ETF charges are higher for buying and selling, but many cap their custody charges for ETFs but not for OEICs. I know its not universal, but I don't think any are the other way round with lower custody charges for OEICs and lower dealing charges for ETFs.

Just wondered what the reason for this is, why ETFs should be more expensive to trade but cheaper to hold.

GeoffTF

OEICs and Unit Trusts used to pay trail commission (except for index trackers). The regulator banned that. Most platforms responded by charging a platform fee instead. The regulator mandated that the fee should be the same for all funds, so they charged it for index trackers too. ETFs are shares. A platform fee was not usually charged for shares, because Crest registered shares could be held in certificated form. It is also more expensive for platforms to support OEICs and Unit Trusts,

cloud_dog

Qyburn said:

Hi,
Just something I keep wondering. Across most platforms, ETF charges are higher for buying and selling, but many cap their custody charges for ETFs but not for OEICs. I know its not universal, but I don't think any are the other way round with lower custody charges for OEICs and lower dealing charges for ETFs.

Just wondered what the reason for this is, why ETFs should be more expensive to trade but cheaper to hold.

Flat fee platform providers like Interactive Investor or iWeb.