Investengine

Pat38493

Am I reading this correct that with Investengine, I can set up an ISA and/or GIA and there are zero platform charges and zero transaction charges (SIPP 0.15% zero transaction charges)?

What's the catch other than you can only invest in a relatively small range of ETFs?

Albermarle

Pat38493 said:

Am I reading this correct that with Investengine, I can set up an ISA and/or GIA and there are zero platform charges and zero transaction charges (SIPP 0.15% zero transaction charges)?

What's the catch other than you can only invest in a relatively small range of ETFs?

There appears to be no catch, although I expect they hope most will pay a bit more for their managed funds.
However you have got to wonder how long they will exist with such low charges.
I presume it is the usual fintech strategy. Burn cash gaining customers and then sell to a bigger player.

Pat38493

Albermarle said:

Pat38493 said:

Am I reading this correct that with Investengine, I can set up an ISA and/or GIA and there are zero platform charges and zero transaction charges (SIPP 0.15% zero transaction charges)?

What's the catch other than you can only invest in a relatively small range of ETFs?

There appears to be no catch, although I expect they hope most will pay a bit more for their managed funds.
However you have got to wonder how long they will exist with such low charges.
I presume it is the usual fintech strategy. Burn cash gaining customers and then sell to a bigger player.

Yes - they claim that they are funded by not paying any interest on cash balances that are not invested, and I saw a few reviews claiming that they take a long time to process transactions (normally with ETF trading you are supposed to get the price immediately if markets are open?), so they might be trying to keep you money in cash for extra days.

I guess the administration costs of ETF trading must be much lower than funds - I can see that quite a few of the providers offer a much better deal on platform charges if you are using ETFs. 

However if this provider treats ETF like funds i.e. they only execute your trade when they feel like it a day or two later, this would be a showstopper for me.

WastedWords

InvestEngine execute trades once per day.
https://help.investengine.com/hc/en-gb/articles/5024299452573-When-is-my-order-going-to-be-executed

cloud_dog

I operated an account with IE for a while, but closed it after I struggled to reconcile the buy prices I was recieving, e.g. they were higher than any of the transaction data I could review.

I queried this with IE but I never received an understandable / acceptable explanation (for me).

Things may have changed since my experience, but I believe their transaction model is (was) based on grouping trades with a single point transaction.

Pat38493

cloud_dog said:

I operated an account with IE for a while, but closed it after I struggled to reconcile the buy prices I was recieving, e.g. they were higher than any of the transaction data I could review.

I queried this with IE but I never received an understandable / acceptable explanation (for me).

Things may have changed since my experience, but I believe their transaction model is (was) based on grouping trades with a single point transaction.

Yes this and the prior reply seems to confirm what I suspected - you are buying ETF, but they only buy them at the same time each day.

On the other hand if you buy ETF with many other platforms, you see the price on the screen at the moment you commit to the purchase and this is the price you will get, even if it takes some time to settle (at least that's my understanding of it).

DavidT67

Vanguard's UK fund platform also only trades ETFs periodically by default, you need to pay extra for immediate trades.

The concern with InvestEngine does seem to be around the opaqueness of the timing and price achieved on those delayed, aggregated trades. Some past posts on this forum suggest that trades can sometimes take several days.

The Freemium model is also used by Trading212, and they are profitable.  InvestEngine did undertake a round of equity crowfunding with some ambitious growth targets and aspirational slides. Whether they can achieve and manage that rate of growth time will tell, T212 has repeatedly struggled to scale up with the demand for their services.

Albermarle

Pat38493 said:

cloud_dog said:

I operated an account with IE for a while, but closed it after I struggled to reconcile the buy prices I was recieving, e.g. they were higher than any of the transaction data I could review.

I queried this with IE but I never received an understandable / acceptable explanation (for me).

Things may have changed since my experience, but I believe their transaction model is (was) based on grouping trades with a single point transaction.

Yes this and the prior reply seems to confirm what I suspected - you are buying ETF, but they only buy them at the same time each day.

On the other hand if you buy ETF with many other platforms, you see the price on the screen at the moment you commit to the purchase and this is the price you will get, even if it takes some time to settle (at least that's my understanding of it).

That is correct for most of the well known platforms. Although there can be delays I think if the market is in turmoil.

Pat38493

Albermarle said:

Pat38493 said:

cloud_dog said:

I operated an account with IE for a while, but closed it after I struggled to reconcile the buy prices I was recieving, e.g. they were higher than any of the transaction data I could review.

I queried this with IE but I never received an understandable / acceptable explanation (for me).

Things may have changed since my experience, but I believe their transaction model is (was) based on grouping trades with a single point transaction.

Yes this and the prior reply seems to confirm what I suspected - you are buying ETF, but they only buy them at the same time each day.

On the other hand if you buy ETF with many other platforms, you see the price on the screen at the moment you commit to the purchase and this is the price you will get, even if it takes some time to settle (at least that's my understanding of it).

That is correct for most of the well known platforms. Although there can be delays I think if the market is in turmoil.

I should probably add, assuming the market for that ETF is open at the time you make the trade.  If the market is closed, I guess you are not guaranteed to get the price on the screen.