DIY Investing platform fees

MQA

 I would like to learn more about fees and charges (in general) for DIY investment

Alexland

1. There are some examples of tiered platform charges but in practice for the lowest fees on larger accounts it's usually best to go with a platform that either has a fixed or low capped charging structure.

2. Generally yes although some platforms have negotiated deals with some fund managers for discounted charges however those platforms tend to have higher percentage platform charges.

3. You can review the performance of your investments as often as you like and develop your own views on them.

Hoenir

MQA said:

3. As investment should be left to grow for at least 5 – 10 years, is there a way to tell whether the funds selected are doing ok?

That's the challenging part for a DIY investor. The temptation to tinker is often too great to resist. Particularly when there's a new fad (trade) driving momentum.  To answer your question. Is the investment meeting the criteria that you set when you purchased it. In addition to which when selecting investments extremely important to identify the negative aspects. Then you'll be ready to take action early as and when the need arises.  

Alexland

MQA said:

To review the performance, I have read some posts which mention to compare the funds I hold with similar ones ('bench mark'??) so as long as it is keeping up I shall leave those funds? and set a target date to sell  and stop investing and enjoy the cash.

There are fund management industry benchmarks however I don't find them that useful as they tend to include data from a lot of awful funds which drag down the average.

For a passive index fund you can compare the performance to other similar trackers and the market itself.  If you have gone with an actively managed fund it's tricky - you can compare to other managers who have a similar strategy or maybe to the benchmark they are trying to outperform (if any) although sometimes they pick an easy benchmark that their asset mix is highly likely to outperform. It's about developing a deep understanding of the fund strategy and how the assets should perform long term and in different economic conditions. You just keep learning and that will either give you confidence or concerns about your investment choice.

Ultimately the most important consideration is if the investment remains likely to meet your personal objectives.

Mark_d

1.  Platform fees often depend on the total value of your investment, though sometimes this is split between shares/ETFs etc and funds.
2.  If investing in funds, different platforms can negotiate different rates with the fund manager.  So you might see some differences.
3.  The platform you choose will normally have some tools to allow to analyse investments.  So you can see how the fund has been doing.  You can also get various bits of information to help you form a view on future prospects.

Beddie

MQA said:

Alexland said:

3. You can review the performance of your investments as often as you like and develop your own views on them.

To review the performance, I have read some posts which mention to compare the funds I hold with similar ones ('bench mark'??) so as long as it is keeping up I shall leave those funds? and set a target date to sell  and stop investing and enjoy the cash.

I use Trustnet to look at fund performance and to compare against peers. Here's a typical example - 

https://www.trustnet.com/factsheets/o/0yd9/jpm-global-equity-income-c-acc

You can see its performance and how it has done against other funds in its sector. You can also click to view all the funds in the sector lower down and look at performance sorted over various time periods.

However... chopping and changing funds is not often a good idea, as you can end up moving to a fund after it's had a good period and just before your old one does!

I try to look for consistency, not the best performer. And this applies mainly to active funds, as trackers will always be average performance by definition. However you can see how they do compared to active funds and unsurprisingly they are usually mid-table.

Short answer that many people will suggest - pick a global tracker and stop looking!

Albermarle

MQA said:

As I am still learning about what funds suits my needs and the platform options, etc. I would like to learn more about fees and charges (in general) for DIY investment

1. With DIY Platform charges, some posts have mentioned fixed fees, per trade, etc I wanted to know whether there are also tiered fee structured ie depending on the total fund value? If so, when should this option chosen?
An example:
£1 – 100,000                           0.29%
£100,000.01- 250,000             0.26%
£250,000.01 – 500,000           0.23%

2. Will the fund manager fees be the same regarding which platform I use?
3. As investment should be left to grow for at least 5 – 10 years, is there a way to tell whether the funds selected are doing ok?

If you do have a platform charging a % fee and having a tiered structure, then you need to look at how the tiering works.
For example HL charge 0.45% for funds under £250K, and 0.25% for funds over £250K.
Whilst Fidelity charge 0.35% for funds under £250K and 0.2% for all funds once they reach the £250K level, not just the funds above £250K.
This would make a significant difference if you had say £300K.
However as already said if you hold this level of investments of OEIC funds, you would be much better off with a fixed fee platform.
Although to complicate matters if you instead invest in shares, ETF's or Investments Trusts, both the platforms mentioned above cap the fees at quite a low level.