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  • FIRST POST
    • RomfordNavy
    • By RomfordNavy 5th Aug 18, 9:00 PM
    • 182Posts
    • 15Thanks
    RomfordNavy
    Which Broker for buying and holding some Investment trusts?
    • #1
    • 5th Aug 18, 9:00 PM
    Which Broker for buying and holding some Investment trusts? 5th Aug 18 at 9:00 PM
    Any suggestions which Broker would be a reasonable cost option in the long-term for buying and holding say half a dozen different Investment Trusts?
Page 3
    • RomfordNavy
    • By RomfordNavy 4th Sep 18, 3:30 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    This has come up several times in the past
    https://forums.moneysavingexpert.com/showthread.php?t=5864188
    Originally posted by ColdIron
    Lindsell Train funds still have provision for 'trail commission' which was outlawed in 2012, this classes it as a dirty fund, hence why iWeb don't allow it.
    • RomfordNavy
    • By RomfordNavy 7th Sep 18, 4:38 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    Would I be correct in my understanding of these charges if I were for example to hold some Vanguard funds:
    1). Direct with Vanguard - pay 0.15% yearly, £0 transaction charges
    2). With iWeb - 0% yearly charge, £5 per transaction

    So it would seem that for anything more than very small holdings iWeb are cheaper than Vanguard in the long-term. Or is there something I am missing are there better bid/offer prices direct from Vanguard or some other advantage that I don't know about?
    • ColdIron
    • By ColdIron 7th Sep 18, 4:57 PM
    • 4,812 Posts
    • 6,325 Thanks
    ColdIron
    That about sums it up, it's a balance between account size and trading frequency. There's a £25 account opening charge with iWeb. You'll encounter a spread on Vanguard's ETFs but you'll pay that whether in Vanguard Investor or out of it
    • RomfordNavy
    • By RomfordNavy 13th Sep 18, 1:24 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    Just discovered another nagative about Vanguard: they charge their holding fee not just on fund holdings but on everything including cash.
    • bowlhead99
    • By bowlhead99 13th Sep 18, 2:31 PM
    • 8,292 Posts
    • 15,174 Thanks
    bowlhead99
    Just discovered another nagative about Vanguard: they charge their holding fee not just on fund holdings but on everything including cash.
    Originally posted by RomfordNavy
    If you want to hold significant amounts of cash, use a bank or building society and earn interest. If you are holding insignificant amounts of cash (say a couple of percent of your overall investment portfolio) pending investment, then a fee of 0 15% a year of that 2% is not really going to change your wealth. After an entire year it would add up to a six hundred and sixty seventh of one fiftieth of your portfolio.

    If you want to hold cash on a platform ready for immediate investment, you may find yourself paying for that service, albeit at a pretty nominal fee. Some will prefer Vanguard's approach of charging a simple flat percentage on everything rather than using someone like (e.g.) HL and paying triple the flat fee on funds and nothing on cash...
    • RomfordNavy
    • By RomfordNavy 13th Sep 18, 3:38 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    ...
    Some will prefer Vanguard's approach of charging a simple flat percentage on everything rather than using someone like (e.g.) HL and paying triple the flat fee on funds and nothing on cash...
    Originally posted by bowlhead99
    Thanks for the info, it is these small details that are not immediately obvious without experience of each. I still have much to learn.
    • RomfordNavy
    • By RomfordNavy 13th Sep 18, 3:47 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    Anyone know what the Baillie Gifford charges are for direct investment?
    • pafpcg
    • By pafpcg 13th Sep 18, 4:42 PM
    • 293 Posts
    • 267 Thanks
    pafpcg
    Baillie Gifford
    Anyone know what the Baillie Gifford charges are for direct investment?
    Originally posted by RomfordNavy
    For the Baillie Gifford Investment Trust Share Plan, when buying shares in an investment trust managed by Baillie Gifford, there are no charges other than stamp duty, the TakeOver Panel fee (£1 if purchase >£10k) and the dealing price spread. See here: www.bailliegifford.com/en/uk/individual-investors/how-to-invest/investment-trust-share-planisa/

    But note that Baillie Gifford aggregate share sales and purchases at a time and date at their convenience - you won't know in advance what the cost per share will be. By aggregating sales and purchases, the bid-offer spread should be reduced (in theory!)
    • Glen Clark
    • By Glen Clark 13th Sep 18, 9:33 PM
    • 4,270 Posts
    • 3,290 Thanks
    Glen Clark
    just a warning about XO, their website and CS is a joke, constantly disabling/locking my account and having to call them, never had this problem with HL/Vanguard etc

    and their service is extremely limited e.g. no dividend reinvest, having to each email time for withdrawals etc. Stick to HL
    Originally posted by cashbackproblems
    That has not been my experience with x-o - I have always found them efficient
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • Glen Clark
    • By Glen Clark 13th Sep 18, 9:37 PM
    • 4,270 Posts
    • 3,290 Thanks
    Glen Clark
    If you want to hold significant amounts of cash, use a bank or building society and earn interest. If you are holding insignificant amounts of cash (say a couple of percent of your overall investment portfolio) pending investment, then a fee of 0 15% a year of that 2% is not really going to change your wealth. After an entire year it would add up to a six hundred and sixty seventh of one fiftieth of your portfolio.

    If you want to hold cash on a platform ready for immediate investment, you may find yourself paying for that service, albeit at a pretty nominal fee. Some will prefer Vanguard's approach of charging a simple flat percentage on everything rather than using someone like (e.g.) HL and paying triple the flat fee on funds and nothing on cash...
    Originally posted by bowlhead99
    Even with no cash in my account I still have an instant dealing limit of £250k on x-o platform - and don't have to pay until settlement day.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • Ash Pole
    • By Ash Pole 14th Sep 18, 8:02 AM
    • 92 Posts
    • 9 Thanks
    Ash Pole
    Even with no cash in my account I still have an instant dealing limit of £250k on x-o platform - and don't have to pay until settlement day.
    Originally posted by Glen Clark
    I didn't know this (I've been with x-o for years). When is settlement day?
    • redux
    • By redux 14th Sep 18, 12:22 PM
    • 18,635 Posts
    • 24,890 Thanks
    redux
    For any of these for investment trusts, it might be worth looking at dividend reinvestment charges, which vary in basis and level.

    For instance, HL is 1%, min £1, cap £10 or £12, iWeb 2%, no minimum, while a couple of other places have £1.50 flat fee.

    When starting from modest levels, it will only be a couple of quid a year difference, but can eventually build up to a bit more significant.
    • talexuser
    • By talexuser 14th Sep 18, 2:48 PM
    • 2,499 Posts
    • 1,988 Thanks
    talexuser
    iWeb is 2%, capped at £5.
    • Glen Clark
    • By Glen Clark 14th Sep 18, 9:15 PM
    • 4,270 Posts
    • 3,290 Thanks
    Glen Clark
    I didn't know this (I've been with x-o for years). When is settlement day?
    Originally posted by Ash Pole
    I think its normally due on the third day? - but I always pay same day.
    x-o sent me an email to ask if I wanted it - they know their money is safe - even when my cash account is empty - because they hold my equities and could sell them to pay for my purchases if I didn't deposit the cash..
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • StellaN
    • By StellaN 14th Sep 18, 11:42 PM
    • 245 Posts
    • 100 Thanks
    StellaN
    If you want to hold significant amounts of cash, use a bank or building society and earn interest. If you are holding insignificant amounts of cash (say a couple of percent of your overall investment portfolio) pending investment, then a fee of 0 15% a year of that 2% is not really going to change your wealth. After an entire year it would add up to a six hundred and sixty seventh of one fiftieth of your portfolio.

    If you want to hold cash on a platform ready for immediate investment, you may find yourself paying for that service, albeit at a pretty nominal fee. Some will prefer Vanguard's approach of charging a simple flat percentage on everything rather than using someone like (e.g.) HL and paying triple the flat fee on funds and nothing on cash...
    Originally posted by bowlhead99
    I thought HL did pay a small interest on cash holdings?
    • RomfordNavy
    • By RomfordNavy 15th Sep 18, 12:27 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    For the Baillie Gifford Investment Trust Share Plan, when buying shares in an investment trust managed by Baillie Gifford, there are no charges other than stamp duty, the TakeOver Panel fee (£1 if purchase >£10k) and the dealing price spread. See here: www.bailliegifford.com/en/uk/individual-investors/how-to-invest/investment-trust-share-planisa/

    But note that Baillie Gifford aggregate share sales and purchases at a time and date at their convenience - you won't know in advance what the cost per share will be. By aggregating sales and purchases, the bid-offer spread should be reduced (in theory!)
    Originally posted by pafpcg
    That link looks like it is about the ISA, it mentions a management charges of £32.50+VAT. There is also the vague paragraph:
    *Other charges include the dealing price, stamp duty (0.5% on purchases), and the cost of managing and administering the investment trust portfolios.
    • RomfordNavy
    • By RomfordNavy 15th Sep 18, 12:38 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    For any of these for investment trusts, it might be worth looking at dividend reinvestment charges, which vary in basis and level.

    For instance, HL is 1%, min £1, cap £10 or £12, iWeb 2%, no minimum, while a couple of other places have £1.50 flat fee.

    When starting from modest levels, it will only be a couple of quid a year difference, but can eventually build up to a bit more significant.
    Originally posted by redux
    Are you sure about iWeb? I recently set-up an ISA with them and they made a point of calling me to ensure I understood the charges. These were £25 opening fee and £5 per trade, nothing else was mentioned.
    • RomfordNavy
    • By RomfordNavy 15th Sep 18, 12:47 PM
    • 182 Posts
    • 15 Thanks
    RomfordNavy
    That link looks like it is about the ISA, it mentions a management charges of £32.50+VAT. There is also the vague paragraph:
    Originally posted by RomfordNavy
    Also just found this while searching around the Baillie Gifford site:

    Costs
    — There is a management charge of £32.50 (plus VAT) per year for managing all of the ISAs you
    hold with us**
    — There is a charge of £22 for each withdrawal
    — There are no charges for switches between investment trusts within your ISA
    — Other charges include the dealing price spread
    †
    and Government stamp duty of 0.5% on
    purchases (including all switches) and certain transfers
    — There is a charge of £32.50 for each transfer to another ISA manager and a further charge of
    £32.50 per trust for re-r
    egistering the shares in the name of another nominee
    — The charges associated with each individual trust are detailed in the relevant Key Information
    Documen
    • atush
    • By atush 15th Sep 18, 5:04 PM
    • 17,260 Posts
    • 10,831 Thanks
    atush
    I'll agree the Baillie Gifford plan is good but it's a dying breed. Purely by coincidence I made a posting yesterday on my experience over 25 years with buying direct from IT managers' share plans: https://forums.moneysavingexpert.com/showthread.php?t=5877671

    For a really long-term hold, consider certificating the holding. That way you get the dividends on the date of distribution paid direct into the bank account of your choice, you get the annual report and a vote at AGMs, and there'll never be any platform charges. Certificating the holding bought at an execution-only broker usually costs £25/holding (SVS charge only £15); amazingly, Baillie Gifford charge nothing for the trusts they manage (Scottish Mortgage, Monks, Scottish American, ...). To sell, just transfer the certificates back to a broker (at no charge).
    But keep the certificates safe!
    Originally posted by pafpcg
    I have bought ITs thru share plans for a couple of decades now. I am a fan.

    Most now have ISAs that you can use if you want a wrapper.
    • londoninvestor
    • By londoninvestor 15th Sep 18, 6:00 PM
    • 414 Posts
    • 336 Thanks
    londoninvestor
    Are you sure about iWeb? I recently set-up an ISA with them and they made a point of calling me to ensure I understood the charges. These were £25 opening fee and £5 per trade, nothing else was mentioned.
    Originally posted by RomfordNavy
    In black and white here: "Dividend reinvestment purchases are charged per reinvestment at a flat rate of 2% based on the value of the dividend (maximum £5)".

    So it's actually a little more favourable than the £5 per trade they told you. Some trades (namely small dividend reinvestments) cost less than that.
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