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  • FIRST POST
    • ColdIron
    • By ColdIron 10th Aug 18, 5:14 PM
    • 4,838Posts
    • 6,401Thanks
    ColdIron
    Charles Stanley Direct to increase fee to 0.35%
    • #1
    • 10th Aug 18, 5:14 PM
    Charles Stanley Direct to increase fee to 0.35% 10th Aug 18 at 5:14 PM
    Just received via email

    Notification of Platform Fee Increase from 10th September 2018:

    Since the launch of Charles Stanley Direct over five years ago, we have maintained an extremely low platform fee of just 0.25%. Over this period of time the pace of change in the digital world has continued to escalate and the costs to the business have grown, particularly relating to cyber security and systems to combat fraud. We have further grown our Edinburgh Helpdesk as user numbers have risen to ensure that we continue to deliver an exemplary customer service.

    Against this backdrop, in order to continue to meet the expectations of our clients with respect to developing our platform and investing in our people, we have made the decision to increase our platform fee to 0.35% from 0.25% on both fund and share holdings. We realise that such news is never welcome and would like to assure you that we have not taken this decision lightly. We will continue to:
    • Maintain our Loyalty Scheme levels at 0.20% for fund balances in excess of £250,000 and sharp tapering thereafter on your amalgamated accounts
    • Retain a charging cap of £240 per annum on our stocks & shares platform fees.
    • Offer a platform fee waiver to stocks & shares holders, meaning that clients can obtain free platform fees by undertaking one monthly trade at £11.50 commission.
    • Maintain free fund dealing on the website and in-App.
    • Offer no administration fees for Investment, ISA or Junior ISA account wrappers. No charge for SIPP wrapper if combined holdings in any CSD account are more than £30,000 in aggregate.
    These new charges will take effect from the 10th September 2018. Further explanation on the reasons for the change in platform fee charging can be seen HERE.

    Letting our clients know of a price increase is not an easy message to pass on, but we hope that you will understand that it will permit us to continue to invest heavily in the service. You will see the results of this investment over the coming months, through further improvements to the App and significant changes to the website.

    The revised Charges & Rates sheet can be found here and during the notification period our standard Terms & Conditions will apply for transfer instructions.

    Thank you for being a Charles Stanley Direct client. We appreciate that our clients have a choice and we do not take your custom lightly.
    Last edited by ColdIron; 10-08-2018 at 5:33 PM.
Page 1
    • Lokolo
    • By Lokolo 10th Aug 18, 5:23 PM
    • 20,016 Posts
    • 15,146 Thanks
    Lokolo
    • #2
    • 10th Aug 18, 5:23 PM
    • #2
    • 10th Aug 18, 5:23 PM
    Think I might be moving then. 40% increase in fees does not make me a happy bunny.

    I am about to rebalance my portfolio, so I might just sell everything to cash, transfer, then rebuy. I guess I'll be out of the market for a couple of weeks which is disappointing. But I cannot justify staying with them with a 40% increase.

    The really frustrating bit is that they charge to transfer out of a SIPP.
    • Aletank
    • By Aletank 10th Aug 18, 5:35 PM
    • 543 Posts
    • 181 Thanks
    Aletank
    • #3
    • 10th Aug 18, 5:35 PM
    • #3
    • 10th Aug 18, 5:35 PM
    Move to where though ? Interactive Investor was one thought but their customer service puts me off, AJ Bell i need to look into more.
    Other providers will pay back any moving fees for you
    • fun4everyone
    • By fun4everyone 10th Aug 18, 5:42 PM
    • 1,116 Posts
    • 1,703 Thanks
    fun4everyone
    • #4
    • 10th Aug 18, 5:42 PM
    • #4
    • 10th Aug 18, 5:42 PM
    Not a good thing for us customers at all. Probably going to keep in CSD what I have there for now but will look into other platforms and reassess.

    If ii is the one where there are many many complaints about dividend payments being late or missing entirely I am not going there. AJ Bell could be ok. Halifax share dealing also. No rush but this has prompted me to shop around.
    • DennisTenus
    • By DennisTenus 10th Aug 18, 5:43 PM
    • 317 Posts
    • 39 Thanks
    DennisTenus
    • #5
    • 10th Aug 18, 5:43 PM
    • #5
    • 10th Aug 18, 5:43 PM
    Only just started this years' ISA with CSD.

    Annoyed.

    Might as well have stuck with HL now!

    This means holding LTGE is going to be cheaper at HL than CSD!!!
    • ruperts
    • By ruperts 10th Aug 18, 5:48 PM
    • 1,161 Posts
    • 1,920 Thanks
    ruperts
    • #6
    • 10th Aug 18, 5:48 PM
    • #6
    • 10th Aug 18, 5:48 PM
    Might sell the non-vanguard funds I hold (only worth about 5% of the portfolio) and move to Vanguard investor.

    Any particular risks to having vanguard funds on a vanguard platform should something happen to Vanguard?
    • DennisTenus
    • By DennisTenus 10th Aug 18, 5:52 PM
    • 317 Posts
    • 39 Thanks
    DennisTenus
    • #7
    • 10th Aug 18, 5:52 PM
    • #7
    • 10th Aug 18, 5:52 PM
    Is there a cheaper platform now for funds that's based on % held?
    • eskbanker
    • By eskbanker 10th Aug 18, 6:02 PM
    • 8,681 Posts
    • 9,894 Thanks
    eskbanker
    • #8
    • 10th Aug 18, 6:02 PM
    • #8
    • 10th Aug 18, 6:02 PM
    Is there a cheaper platform now for funds that's based on % held?
    Originally posted by DennisTenus
    Yes, Vanguard are cheaper at 0.15% (if you're only buying into their funds), or a couple of other 0.25% options are shown at http://monevator.com/compare-uk-cheapest-online-brokers/
    • Lokolo
    • By Lokolo 10th Aug 18, 6:06 PM
    • 20,016 Posts
    • 15,146 Thanks
    Lokolo
    • #9
    • 10th Aug 18, 6:06 PM
    • #9
    • 10th Aug 18, 6:06 PM
    https://forums.moneysavingexpert.com/showthread.php?t=5583030

    There is a spreadsheet there which is pretty decent. I'm kind of stuck what to do. Going to 0.35% is just a jump too high for me.
    • DennisTenus
    • By DennisTenus 10th Aug 18, 6:18 PM
    • 317 Posts
    • 39 Thanks
    DennisTenus
    I suppose it's possible HL could put their price up at any time too?
    • ColdIron
    • By ColdIron 10th Aug 18, 6:23 PM
    • 4,838 Posts
    • 6,401 Thanks
    ColdIron
    Is there a cheaper platform now for funds that's based on % held?
    Originally posted by DennisTenus
    Cavendish and AJ Bell are obvious alternatives at 0.25%. Cavendish don't do shares and AJ Bell charge £1.50 per trade. Vanguard Investor would be cheaper at 0.15% if you just want Vanguard (no SIPP yet), I have Fundsmith and L&G Global Healthcare & Pharma which shuts that door for me. iWeb are worth considering if you don't trade much and if they offer the funds you want, they don't appear to have Vanguard Global Small Cap. A quandary
    • masonic
    • By masonic 10th Aug 18, 6:31 PM
    • 10,276 Posts
    • 7,629 Thanks
    masonic
    I suppose it's possible HL could put their price up at any time too?
    Originally posted by DennisTenus
    The thing with a percentage based fee is that the amount of money the platform receives will naturally increase with the value of investments under management (so it's pretty well inflation-protected), so there shouldn't really be much need to increase them. Unless, the original price was a loss-making promotional rate to build market share. It seems less likely HL would increase based on their profitability figures. They might need to raise the £45/year cap on platform fees for shares, ITs and ETFs though.

    I would second iWeb as a credible alternative.
    • DennisTenus
    • By DennisTenus 10th Aug 18, 6:36 PM
    • 317 Posts
    • 39 Thanks
    DennisTenus
    Already have IWeb but i like buying more when there is a dip and every now and then whenever I please and also IWeb don't have all the funds I want.... eg. LTGE is a big one.
    • Thrugelmir
    • By Thrugelmir 10th Aug 18, 6:59 PM
    • 61,269 Posts
    • 54,505 Thanks
    Thrugelmir
    The thing with a percentage based fee is that the amount of money the platform receives will naturally increase with the value of investments under management (so it's pretty well inflation-protected), so there shouldn't really be much need to increase them.
    Originally posted by masonic
    Unless the investments held are index linked. There's no guarantee of that. People expect excellent customer service, software updates etc. All has to be paid for. Then there's the increased regulatory burden as well.

    Might decide to change their target market as well. To discourage smaller investors from opening accounts.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • masonic
    • By masonic 10th Aug 18, 7:24 PM
    • 10,276 Posts
    • 7,629 Thanks
    masonic
    Unless the investments held are index linked. There's no guarantee of that. People expect excellent customer service, software updates etc. All has to be paid for. Then there's the increased regulatory burden as well.
    Originally posted by Thrugelmir
    These factors primarily translate into salary, software and infrastructure costs, and are counterbalanced by increases in efficiency, assets under management and economies of scale. Assets under management will grow not only due to investment growth, but also due to increases in the disposable income of their clients.

    Unless the cost of doing business increases for them more rapidly than clients' invested assets for a sustained period, they should be able to maintain their profit margin without hiking their percentage based fees. A change should be relatively rare, compared with hikes in the fees of those who charge a fixed amount per account.

    Might decide to change their target market as well. To discourage smaller investors from opening accounts.
    This IMHO is much more likely. HL cross-subsidises small investors to a high degree, presumably because of the inertia of them switching when their portfolios grow. This is another example of a loss leader and it would make most sense to address this imbalance in profitability.
    • Sue58
    • By Sue58 10th Aug 18, 7:25 PM
    • 155 Posts
    • 49 Thanks
    Sue58
    The thing with a percentage based fee is that the amount of money the platform receives will naturally increase with the value of investments under management (so it's pretty well inflation-protected), so there shouldn't really be much need to increase them. Unless, the original price was a loss-making promotional rate to build market share. It seems less likely HL would increase based on their profitability figures. They might need to raise the £45/year cap on platform fees for shares, ITs and ETFs though.

    I would second iWeb as a credible alternative.
    Originally posted by masonic
    However, if it the investment was for a SIPP then iWeb use AJ Bell so Iím not sure that would be more cost effective. I use Fidelity for my SIPP but only hold ITís and the platform charges are capped at £45 per annum. I believe there is no charge for ITís with ISAís and GIAís.
    • masonic
    • By masonic 10th Aug 18, 7:30 PM
    • 10,276 Posts
    • 7,629 Thanks
    masonic
    However, if it the investment was for a SIPP then iWeb use AJ Bell so I!!!8217;m not sure that would be more cost effective. I use Fidelity for my SIPP but only hold IT!!!8217;s and the platform charges are capped at £45 per annum. I believe there is no charge for IT!!!8217;s with ISA!!!8217;s and GIA!!!8217;s.
    Originally posted by Sue58
    Yes, holding ITs, ETFs and shares changes the balance - HL becomes a cheap option (although still rather expensive for a SIPP). To answer your question, AJ Bell is cheaper than iWeb in most scenarios for holding a SIPP, especially if you take advantage of the regular investing rate when buying.

    I'm rather settled holding the bulk of my portfolio with II, but I won't recommend them as are lots of caveats associated with investing with them.
    Last edited by masonic; 10-08-2018 at 7:34 PM.
    • EdSwippet
    • By EdSwippet 10th Aug 18, 7:52 PM
    • 825 Posts
    • 797 Thanks
    EdSwippet
    iWeb are worth considering if ... they offer the funds you want, they don't appear to have Vanguard Global Small Cap.
    Originally posted by ColdIron
    Are you referring to this fund? I hold units of it in my iWeb ISA.
    • ColdIron
    • By ColdIron 10th Aug 18, 8:10 PM
    • 4,838 Posts
    • 6,401 Thanks
    ColdIron
    Are you referring to this fund? I hold units of it in my iWeb ISA.
    Originally posted by EdSwippet
    Yes, that's the chap. I was looking at the UK listing not Ireland. Many thanks
    • Alexland
    • By Alexland 10th Aug 18, 8:14 PM
    • 3,811 Posts
    • 3,123 Thanks
    Alexland
    This IMHO is much more likely. HL cross-subsidises small investors to a high degree, presumably because of the inertia of them switching when their portfolios grow. This is another example of a loss leader and it would make most sense to address this imbalance in profitability.
    Originally posted by masonic
    Peter Hargreaves pretty much admits this in his book 'In For A Penny' where his original idea was to get a penny from everyone in the country so HL has a deliberately low barrier to open an account and get started.

    Alex
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