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Compare the UK’s cheapest online brokers

Last updated on 13 November 2017.

Behold! An at-a-glance cost comparison of the UK’s main online brokers and investment platforms. These services enable you to buy, manage, and sell your funds, shares, investment trusts and ETFs at a cheap price. All these services are online and execution-only.

The Good for column shows what we think is the best deal by price, relative to account type and portfolio mix.1

This table is edited by fallible human beings. Do your own research. We fix mistakes as soon as possible but we cannot be held liable or accountable for any errors. Please add updates or erratas in the comments below.

Like other price comparison websites, we may be paid a bonus if you sign-up via a link. This does not affect what you pay.

Hate maths? Let our comparison tool do the sums for you.

Flat fee brokers / platforms

Company Annual platform fee Fee notes Dealing: Funds Dealing: ETFs, ITs, & shares Regular investing Entry fee Exit fee2 Good for
Interactive Investor3 Motley Fool Share Dealing and Telegraph  Investor use same platform.4   £90 £22.50 worth of free trades every quarter £10* £10* £1 £0 if account open less than a year. £10 per holding otherwise.  Min £30/Max £250
Shares ISA Mixed ETF/fund portfolios over £32K5
Trading
SIPP + £120 + £120 drawdown + £90 Fund only over £70K, Mixed ETF/fund over £74K vs Fidelity6
Halifax Share Dealing £12.50 £12.50 £2 Infrequent traders
Shares ISA £12.50 £25 per holding. £125 max
Trading £25 per holding. £125 max Mixed ETF/fund portfolios above £42K vs Fidelity7
SIPP £90 if SIPP worth less than £50K. £180 if SIPP more than £50K + £180 drawdown8 £60 per transfer. Max £300 £25 per holding (£215 max) +£90 Infrequent traders with SIPPs under £50K
iWeb £25 one-off account opening charge Does not apply to SIPP £5 £5 Large portfolios and infrequent traders, check vs ii, Lloyds and Halifax
Shares ISA £25 per holding. £125 max
Trading £25 per holding. £125 max
SIPP £90 if SIPP worth less than £50K. £180 if SIPP more than £50K + £180 drawdown9 £60 per transfer. Max £300 £25 per holding (£215 max) +£90
Lloyds Bank Share Dealing £40 Only one £40 charge if you hold ISA and trading account £1.50 £11* £1.50 £25 per holding. £125 max
Shares ISA Fund portfolios over £25K10
Trading Fund portfolios over £25K11
SIPP n/a
The Share Centre 1%. £7.50 min* 1%. £7.50 min* 0.5%. Min £1 Large trading accounts
Shares ISA £57.60 £25
Trading £21.60 £25
SIPP £172.80 + £234 drawdown £90 if in drawdown £25 per holding +£120 if in drawdown
Clubfinance Frequent Trader £15 inactivity fee per quarter. Waived by 3 trades per quarter 0.21% fee on debit card payments in, use BACs £4.95 £4.95 £15 per holding Frequent traders
Shares ISA
Trading
SIPP n/a
Alliance Trust Savings 4 free trades p.a. £9.99* £9.99* £1.50
Shares ISA £120 £120
Trading £120 £72
SIPP £252 £342 drawdown 1% of value capped at £18012

Note: Charges may actually be due per month, quarter, six monthly or annually. We’ve chosen to show annual cost of service. All prices include VAT. *A frequent trader rate or bonus is also available.

Percentage fee brokers / platforms

Company Annual platform fee Fee notes Dealing:
Funds
Dealing: ETFs, ITs, & shares Regular investing Entry fee Exit fee13 Good for
Vanguard Investor 0.15% on first £250,000, 0% thereafter. Tiered charge. Max £375  Investments restricted to Vanguard funds and ETFs only £0 £0 twice per day, £7.50 to trade at other times £0 £0  Beats other % fee brokers in most cases and flat-fee brokers up to £40-£50K but restricted range
Shares ISA Fund portfolios up to £42K, mixed ETF/fund up to £53K, ETF portfolios up to £30K
Trading Fund portfolios up to £42K, mixed ETF/fund up to £49K
SIPP n/a
Close Brothers 0.25% on all investments 0.25% on ETFs, ITs, bonds and shares £0 £8.95 £0 Small fund portfolios
Shares ISA Fund portfolios below £25K
Trading Fund portfolios below £25K
SIPP £90 drawdown Fund portfolios below £70K
Cavendish Online 0.25% on all investments 0.20% on whole balance if over £200K in all accounts combined £0 0.1% £0 Small fund portfolios
Shares ISA Fund portfolios below £25K, ETF only below £18K, mixed ETF/fund below £32K
Trading Fund portfolios below £25K, mixed ETF/fund portfolios below £7.5K
SIPP Fund portfolios below £70K, ETF only below £18K, Mixed ETF/fund below £36K
Charles Stanley Direct 0.25% on first £250,000 of funds14 0.25% on shares, ETFs and ITs. Min £24 / Max £24015 £0 £11.50 £10 per holding Small fund portfolios
Shares ISA Fund portfolios ISAs below £25K
Trading Fund portfolios below £25K
SIPP + £120 No £120 charge if £30,000+ of assets across all accounts + £150
Selftrade 0.3% on first £50K of funds. 0.25% £50K – £250K. 0.15% over £250K. £1,000 max. Tiered £12 inactivity fee per quarter. Waived by single trade per quarter or if any funds held £0 buy, £11.75 sell £9.99* ETFs,£11.75* shares £1.50 ETF portfolios with unrestricted range
Shares ISA £15 per holding
Trading £15 per holding
SIPP + £118.80 + £180 drawdown £90
Fidelity 0.35% on all assets worth £7500 – £250,00016 Flat rate of £45 on assets worth less than £750017 £0 0.1% for ETFs / ITs £0 ETF portfolios18
Shares ISA ETF and IT fees capped at £45 ETF portfolios over £18K19
Trading ETF and IT fees do not apply ETF portfolios20, mixed ETF/fund between £7.5-42K
SIPP ETF and IT fees capped at £45 ETF portfolios21, mixed ETF/fund between £36-74K22
AJ Bell Youinvest23 0.25% on first £250,000 of funds24 0.25% on first £250K then 0.1% on next £750K etc £1.50 £9.95* £1.50 £25 per holding
Shares ISA + 0.25% charge (max £30) on ETFs, ITs, shares, and bonds
Trading + 0.25% charge (max £30) on ETFs, ITs, shares, and bonds
SIPP + 0.25% charge (max £100) on ETFs, ITs, shares, and bonds. + £120 drawdown + £90
Bestinvest Platform fee applies to all investments Tiered charge. e.g. you pay 0.4% on first £250K then 0.2% on next £750K etc £0 £7.50 £25 per holding
Shares ISA 0.4% on first £250,00025 0.2% £250,001 – £1 million, 0% over £1 million
Trading 0.4% on first £250,00026 0.2% £250,001 – £1 million, 0% over £1 million
SIPP 0.3% on first £250,00027. No drawdown fee 0.2% £250,001 – £1 million, 0% over £1 million + £150
Trustnet Direct 0.25% on all investments Min £20. Max £200 £10* £10* £2
Shares ISA £15 per holding
Trading £15 per holding
SIPP + £96 + £204 if in drawdown £60 per transfer. Max £360 £120
rplan 0.35% Funds only £0 n/a £0
Shares ISA
Trading
SIPP n/a
Barclays Smart Investor 0.2% on funds (£48 min, £1500 max) 0.1% on ETFs, ITs, shares, bonds £3 £6* £1 £30 per holding
Shares ISA
Trading
SIPP + £150 + £120 drawdown £90 per transfer capped at £450 + £90
Hargreaves Lansdown 0.45% on first £250,000 of funds28 Tiered charge. You pay 0.45% on first £250K then 0.25% on next £750K etc £0 £11.95* £1.5029 £30 account closure + £25 per holding
Shares ISA + 0.45% charge (max £45) on ETFs, ITs, shares, and bonds
Trading
SIPP + 0.45% (max £200) on ETFs, ITs, shares, and bonds No drawdown fee
Aviva 0.4% on first £50,000 of funds30 Tiered charge. You pay 0.4% on first £50K then 0.35% on next £200K etc £0 £0
Shares ISA
Trading
SIPP

Note: Charges may actually be due per month, quarter, six monthly or annually. We’ve chosen to show annual cost of service. All prices include VAT. *A frequent trader rate or bonus is also available.

Share dealing brokers

Company Annual platform fee Fee notes Dealing:
Funds
Dealing: ETFs, ITs, & shares Regular investing Entry fee Exit fee31 Good for
Degiro  – Degiro may lend out your shares. A custody account avoids this but charges €1 + 3% (max 10%) for dividend payouts32 n/a Commission free ETF selection. €2 + 0.02% for other ETFs. £1.75 + 0.004% for shares33 €10 per holding €10 per holding No trading costs on select ETF range,34 frequent traders
Shares ISA n/a
Trading
SIPP n/a
X-O.co.uk No funds n/a £5.95 Large SIPP ETF portfolios with unrestricted range
Shares ISA £18 per holding +£60 account closure
Trading £18 per holding
SIPP £0 £0 if SIPP is linked to X-O dealing account. Otherwise £118.80. +£180 drawdown £60
Interactive Brokers $10 inactivity fee per month. Reduced by value of trades35 $10,000 min to open account. $20 inactivity fee if equity balance below $2,00036 n/a £637 International shares / ETFs
Shares ISA
Trading
SIPP Fees vary

Note: All prices include VAT.

Who is this online broker comparison table aimed at?

We have focussed on low cost platforms that suit DIY investors who want to build a diversified portfolio through index funds and ETFs. The Good for column is therefore biased towards passive investors.

Percentage fee brokers are much better for small investors whose assets are likely to remain below £25,000 (in an ISA) or £70,000 (in a SIPP) for some time to come. If you can only invest small amounts at a time then choose a broker who charges £0 for fund dealing. (Aim to pay no more than 0.5% of your contribution in dealing costs, at the very most).

Fixed fees take a disproportionate chunk out of the assets of small investors. This is why Charles Stanley, Close Bros or Cavendish Online are generally the best for small investors using ISAs and Best Invest or Cavendish Online is best for small investors using SIPPs.

Flat fee brokers are better for most investors who’ve accumulated over £25,000 (in an ISA) or £70,000 (in a SIPP) – percentage fees can siphon off eye-watering amounts if your broker doesn’t apply a cap. Sadly, the table is complicated because every broker is trying to carve out a niche for itself by offering something slightly different to its competitors.

That means there is no one size fits all solution. The Good for column in the table gives you an idea of each broker’s strengths.

Our calculations assume one purchase per month and four sales per year, and that you take advantage of lower priced regular investment schemes when available. Portfolios consist of funds or ETFs or a 50:50 mix.

ETFs vs fund portfolios – Below around £25,000 you’re probably better off with funds. There’s very little to separate Interactive Investor, TD Direct, Halifax, Lloyds, iWeb, YouInvest, Selftrade and Share Centre above that level if you’re a moderate trader using either product type. Ultimately, product OCFs, your trading frequency and picking the right tracker for the job will be more important.

Beginners starting in funds should look at Cavendish Online or Close Bros. 
Low traders – check iWeb and Halifax for ISAs.
Whichever broker you plump for, do check it carries the funds you require. There is considerable variation in range between platforms.

Where is my missing broker?

We haven’t included every last option in this version of our table but we have included the most competitive players in the market. Do let us know if you think we’ve missed anyone important.

More on costs and fees

The ‘Platform charge’ category is intended to capture the various types of service fee typically levied by platforms i.e. custody fee, platform charge, administration fee, inactivity fee and so on until the end of time / your tether.

Assume platform charges are levied per account unless otherwise indicated in the notes column or the footnotes.

Platforms levy various additional costs for extras such as telephone trading. Check a platform’s rates and charges schedule before committing.

These costs are on top of the suite of fees you will pay for investment products such as the Ongoing Charge Figure (OCF).

Take some time to calculate the likely cost of your portfolio when choosing the right broker.

SIPP charges on the table don’t include the various additional fees levied for services once you’re in drawdown.

Platforms run temporary offers and discounts from time-to-time. These are ignored as investing is for the long-term.

Understanding account names

Accounts names vary across the discount broker universe. However they typically conform to the following types:

  • Trading = taxable account i.e. not an ISA or a SIPP. Suitable investments typically include funds, shares,Exchange Traded Funds (ETFs), Investment Trusts (ITs), bonds and more.
  • Shares ISA = Stocks and Shares ISA. Tax sheltered. Suitable investments as above.
    • SIPP = Self-Invested Personal Pension. Tax sheltered. Suitable investments as above.

Why are there only links to some brokers?

Links to brokers are affiliate links, where we may be paid a fee if you go on to open an account with them. We do not choose to include brokers in our table based on whether such affiliate fees are on offer, nor does the existence of such an arrangement change the fees you pay – it is a marketing payment made by them as an incentive for websites to drive traffic to their site. We’d like more brokers to pay us when we introduce new customers – it helps us pay our way on Monevator! Including all brokers but only linking where an affiliate agreement is in place was the best compromise we could come up with.

What this table won’t tell you

Some of these brokers may not be regulated by the UK authorities. Please check directly with each broker, and read our guide to investor compensation schemes to understand why this matters.

We’ve not considered customer service and fringe benefits such as website user experience and research tools, which may be meaningful. Ask away here or at Money Saving Expert’s Savings & Investments board, the ex-Motley Foolers on the Lemon Fool board, or reddit for a broader opinion.

We haven’t accounted for exclusive, discounted funds. Most platforms stock much the same range but the bigger players in the market can negotiate slight fee discounts on certain funds. If you’re tempted by those ‘bargain’ offers then make very sure that your overall cost of investment isn’t more expensive once you load the platforms fees on top.

Please tell us about additions or corrections using the comment form below. Please supply a Web link to your data if possible in your comment to help us verify what should go into the table.

We’ll keep this table as up-to-date as possible, and conduct a sweeping review every three months.

  1. Our calculations assume one purchase per month and four sales per year, and that you take advantage of lower priced regular investment schemes when available. Portfolios consist of funds or ETFs or a 50:50 mix. []
  2. Out to another broker []
  3. Also known as ii []
  4. We expect these platforms to be merged with Interactive Investor in December. []
  5. £53K vs Vanguard []
  6. ii provide the same service to Motley Fool []
  7. £49K vs Vanguard []
  8. £300 if age 75+ []
  9. £300 if age 75+ []
  10. £42K vs Vanguard []
  11. £42K vs Vanguard []
  12. No charge for SIPP opened after 31 Mar 2017 if you’re over 55. []
  13. Out to another broker []
  14. 0.2% £250,001 – £500,000, 0.15% £500,001 – £1million, 0.05%£1million – £2 million, 0% over £2 million. []
  15. Charge waived by 1 trade per month. []
  16. 0.2% £250,000 – £1 million. Charges not tiered. Charge capped at £1 million. Treat multiple accounts as one, e.g. 0.2% applies to all assets once £250K barrier crossed. ETF and IT fees capped at £45 for all portfolio sizes. []
  17. ETF and IT fees capped at £45 for all portfolio sizes. []
  18. Check vs TD Direct, Selftrade, iWeb, Halifax, Youinvest and ii. Fidelity have a restricted range of ETFs in comparison to others. []
  19. Check vs TD Direct, iWeb, Halifax, Vanguard, Youinvest and ii. Fidelity have a restricted range of ETFs in comparison to others. []
  20. Check vs TD Direct, Selftrade, iWeb, Halifax, Youinvest and ii. Fidelity have a restricted range of ETFs in comparison to others. []
  21. Check vs X-O.co.uk. Fidelity have a restricted range of ETFs in comparison to others []
  22. Restricted range of ETFs so check vs Youinvest if portfolio worth less than £54K, otherwise XO.co.uk []
  23. Formerly Sippdeal []
  24. 0.1% £250,001 – £1 million, 0.05% £1 million – £2 million, 0% over £2 million []
  25. Charge applies to each account separately []
  26. Charge applies to each account separately []
  27. Charge applies to each account separately []
  28. 0.25% £250,001 – £1 million, 0.1% £1 million – £2 million, 0% over £2 million. Charge applies to each account separately []
  29. on FTSE 350 shares and certain ITs []
  30. 0.35% £50,001 – £250,000, 0.25% £250,001 – £500,000, 0% over £500,000. []
  31. Out to another broker []
  32. No funds. []
  33. £5 max []
  34. Note, these are ETFs traded on US and European exchanges not LSE. []
  35. e.g. $10 fee – $6 trade = $4 actual fee that month. Waived on $100,000+ accounts. []
  36. Under 25s can open an account with $3,000 and the inactivity fee is $3. []
  37. up to £50,000 value. £6 + 0.05% of incremental trade value over £50,000. Max £29 []
{ 1940 comments… add one }
  • 1901 Tom November 13, 2017, 7:07 pm

    Ah, I see. Good to hear about the transfer fee flexibility. Thanks

  • 1902 Bastiat November 13, 2017, 7:29 pm

    Never had any issue with iWeb but then I only trade once a year when it’s ISA time and only trade index funds. If your are day trading then this is probably not the right platform (nor is monevator the right website for advice).

  • 1903 Mr Optimistic November 14, 2017, 8:48 pm

    Still don’t understand the comment against Halifax Sharedealing SIPP. Why portfolios under £50k? Should that be over?

  • 1904 ChrisC November 15, 2017, 12:06 am

    I agree with Mr Optimistic, I have a Halifax SIPP where the annual charges have reached the cap and my trading volumes are low so the charges seem good. This may go against the grain for this site but personally I don’t chase low cost over everything: I’ve worked in the collective investment industry and I know that they have costs to cover, if the charges drop too low then the level of service will suffer. What I don’t like are platforms that take a percentage fee with no cap (or a very high one). Their cost of supporting my account is almost completely divorced from the actual value of my account.

  • 1905 Scott November 15, 2017, 3:24 pm

    @Mr Optimistic – my reading of it is that Halifax’s annual platform charge doubles for SIPPs over £50k, so it’s good for those with a SIPP below that threshold but other platforms may offer better value for those above £50k.

  • 1906 Dan November 17, 2017, 9:25 pm

    Just a note of caution regarding the X-O.co.uk SIPP. An annual fee of £118.80 is taken from your account to pay the SIPP administrator (Gaudi) and subsequently refunded back to your account. Last year the refund took approximately two months but this year I’ve been waiting a couple of days short of 3 months. Make of that what you will.

  • 1907 Kronk November 18, 2017, 3:36 pm

    Hi there,

    I’m in the process of setting up an ISA with Interactive Investor.

    If I were to follow a similar passive approach to the S&S portfolio on here and invest in around 7 index tracker funds would it be better to buy and rebalance each quarter which would incur fees of around £50/quarter (with 2 being effectively free and the other 5 costing £10 each) or would it be better to just use the two free fund trades and do the best job of rebalancing with those two that I can each quarter. Will the cost of rebalancing be worth the extra £200/year in trading costs?

    I have an existing cash iSA with around £50k which I will transfer in and will be making the maximum ISA contribution each year and it’s unlikely I’ll need to withdraw anything for at least 10 years. I know the Vanguard Lifestrategy funds are an option but I’m planning on also opening a SIPP with iii to invest in one of these and am looking to invest in index funds via my ISA rather than an all in one fund like the Lifestrategy ones.

  • 1908 John. November 18, 2017, 5:56 pm

    K, you have to learn by your own mistakes I suppose.

    What is it about Interactive Investor that attracts you to them specifically? Many former TD clients are currently ditching them.

    My opinion, iWeb, ditch the idea of seven and simply choose VWRL, IWDP and a global bond index ETF in the proportions you desire then rebalance annually with new money if able. At £50K and a further £20K+ annually this will reduce ongoing platform costs to a pittance.

  • 1909 Tom November 19, 2017, 7:12 pm

    £85K.. or maybe daily subsistence payments. Something to keep an eye on.. (courtesy of ZeroHedge)

    “OPINION OF THE EUROPEAN CENTRAL BANK of 8 November 2017”

    “claims under investor compensation schemes should be replaced by limited discretionary exemptions to
    be granted by the competent authority in order to retain a degree of flexibility. Under that approach,
    the competent authority could, for example, allow depositors to withdraw a limited amount of
    deposits on a daily basis consistent with the level of protection established under the Deposit
    Guarantee Schemes Directive (DGSD)34, while taking into account potential liquidity and technical
    constraints.”

    https://www.ecb.europa.eu/ecb/legal/pdf/en_con_2017_47_f_sign.pdf

  • 1910 Kronk November 19, 2017, 8:16 pm

    Thanks John,

    I’d heard that iii was one of the cheapest that offered a flat fee charge and also had one of the best range of funds available but I’ve had a look at iWeb and they seem to have a similar fund list but lower charges so I may reconsider and go with iWeb for both the ISA and the SIPP now. If I just rebalance annually as you suggest then from what I can tell I’d be paying next to nothing in charges (just £5 per fund deal and an extra £25 in year one) vs a minimum £120 a year with iii.

    Thanks for your advise about the 3 fund option, I’ll take a look at them in more detail when I get a moment.

  • 1911 IvanK. November 20, 2017, 6:32 pm

    Would appreciate brief answers on the following queries: can one easily adjust book cost of shares held with X-O or iWeb?

    Also, I know that iWeb automatically logs clients out after just 10 minutes inactivity. Does X-O do the same? TDD’s inactivity period is 30 mins, which I think II are keeping. – Thanks in advance.

  • 1912 Kraggash November 20, 2017, 6:44 pm

    iWeb – IvanK
    Book cost can be adjusted by phoning them (or probably via web chat)

    Z

  • 1913 IvanK. November 20, 2017, 9:05 pm

    Kraggash, thanks! Appreciated.

    If anyone else drops by & can confirm the same queries about X-O (ie. how long before automatic log-out after inactivity & X-O’s ability to adjust book cost), that’ll also be much appreciated. Will catch up tomorrow evening.

  • 1914 Jeffrey Beranek November 20, 2017, 9:24 pm

    I’m not sure why you are worried about the automatic logout period on X-O and iWeb, which are there for security reasons. Are you using it for day trading? You can monitor live prices on Google finance, whereas prices on the broker sites are usually 15 mins delayed unless you request a quote.
    If you are really worried about it, there are web browser plugins that can automatically reload a page every x mins, but I wouldn’t advise using them for security reasons.

  • 1915 IvanK. November 20, 2017, 9:50 pm

    Jeffrey, thanks. I sometimes get logged out even after 30 mins with TDD. Usually when distracted by other trading screens as I also spread-bet, which can be very intense. So it goes. But I’m now wondering if the hassle of getting an auto log-out every 10 mins won’t cost me more than the few quid I’d save via commission. Hard to be sure. – I’m assuming by your comment that X-O has the same 10 mins limit as does iWeb.

    I agree plug-ins aren’t the way to go with trading accounts for security reasons. But thanks anyway. Appreciated.

    I’m still thinking a few things over & I’ll give it at least another week before I decide whether to stay with TDD/II or to transfer.

  • 1916 Jeff Beranek November 21, 2017, 10:06 am

    I’m afraid I don’t know what the timeout times are on X-O and iWeb (although I have an account with both). There is no easy way to determine this, without repeatedly waiting for longer and longer times to to interact with the site. If you’re concerned, I would suggest calling them to ask.

  • 1917 IvanK. November 22, 2017, 9:49 am

    Jeff, thanks again. Contacted X-O &, in case anyone else is interested, X-O confirm that their platform is set for auto-logout after 1 hour. For me personally, another factor that makes X-O a main contender if I decide to switch from TDD/II.

  • 1918 cimh November 22, 2017, 1:28 pm

    John (in reply 1908) mentioned VWRL which was new to me, so I looked it up and it seems almost identical to HMWO which I do hold.

    VWRL: OCR = 0.24%, Yield = 1.86% , 5yr gain = 86%
    HMWO: OCR = 0.15%, Yield = 2.09%, 5yr gain = 87%

    So it looks to me as if HMWO is slighly cheaper but just as good? although the differences are probably too small to be significant.

    Back to the topic I have isas with HL and IWeb and shares with X-O. HL is best for information and support – If you only want one platform then I would highly recommend that HL should be the one to go for. IWEB is the one I currently pay into, because its cheaper. X-O is also cheap but I would say that IWEB has the edge over it.

  • 1919 Mikesmusing November 22, 2017, 8:00 pm

    cimh

    Just looked up VWRL and HMWO on Morningstar (via the AJ Bell Youinvest website). According to Morningstar:
    VWRL aims to track the FTSE All World Index; HMWO aims to track the MSCI World Index. So not quite the same thing.
    But more importantly both seem to deliver returns over the five years to 22 Nov 2017 that are substantially less than the relevant index returns 3.22% pa shortfall for VWRL and 2.74% pa shortfall for HMWO. These are obviously much larger shortfalls than can be explain by the fund charges.

    Can any readers of this column explain why these so-called trackers should apparently fall so far short of the indices they claim to track? Depending on the explanation it may somewhat undermine the rationale for picking a low cost tracker, if it cannot in fact be relied upon to track the relevant index less allowance for the explicit manager charge.

    I’m keen to understand this as some Vanguard ETFs have been my worst performing investments, in relative terms.

  • 1920 The Accumulator November 22, 2017, 10:42 pm

    Hi Mike, looking at VWRL on AJ Bell (courtesy of Morningstar’s data)…

    Fund Benchmark = FTSE All World NR USD
    Morningstar® Benchmark = MSCI World NR USD

    Morningstar measure the ETF against the wrong benchmark. So the benchmark comparison data is pointless. Morningstar do this a lot.
    It’s highly unlikely that any normal ETF would survive if it was undershooting its benchmark by 3% a year. Investors would abandon ship.
    Re: using free data – there’s often a mismatch between time periods used (e.g. benchmark and ETF) which renders comparisons inaccurate too. Tax treatments, dividend treatments, you name it. It’s a minefield.

  • 1921 Elef November 22, 2017, 11:54 pm

    Vwrl tracks Ftse All world which includes an emerging markets element. Hmwo tracks Msci world which does not (Msci Acwi is the equivalent index).

    Vwrl and Hmwo will have underperformed the indices as they are in gdp, the indices are in usd. So on a usd to usd comparison the funds track very closely but as the pound has severely depreciated against the dollar they have underperformed (principally since brexit). When you look at the fact sheets these will show fund performance for the usd fund vs the index (also in us) for an apples to apples comparison.

  • 1922 ivanopinion November 23, 2017, 11:00 am

    @Elef
    If the pound has become weaker against the dollar (which it has), wouldn’t that mean the returns in sterling terms are higher than in dollar terms? Five years ago, a pound bought 1.62 dollars, so if the index in dollars was 162, that would have been GBP100. If the index had stayed at USD162, at today’s FX rate of 1.33 that would be GBP122. That’s a 22% outperformance, or about 4% a year.

  • 1923 Elef November 23, 2017, 1:33 pm

    @Ivanopinion – you are right. I was on my phone and couldn’t get AJ Bell/Morningstar to work. TA’s explanation covers what the issue is, so what I said doesn’t apply in this case. What I was trying to get at is that some data providers will look like they plot performance from the opposite direction to what your explanation, showing an “underperformance” rather than an “outperformance”. In reality these will offset on an apples-to-apples comparison.

    @TA – yes you are right on Morningstar, they don’t use FTSE indices for comparison.

    You have to check that the performance is being measured against the right benchmark. FTSE and MSCI sell their index data (for a lot of money), and some providers will buy one and not the other. And the difference between the FTSE and MSCI isn’t trivial. For example, MSCI counts South Korea as a Developing Country, FTSE counts it as a Developed Country (among a myriad of other differences).

    Another issue that TA highlights is that there is often mis-matches on total return and net return – some data providers will (inexplicably) not adjust for dividends which means you may inadvertently look at your funds’ returns and not take into account the dividends they have paid (I know this used to be a problem with Yahoo Finance several years ago).

    I always recommend going to the fund providers’ website to get any data/prices as these will (should…) be on the most appropriate basis.

  • 1924 Mikesmusing November 23, 2017, 11:15 pm

    Elef, TA, Ivanopinion
    Thanks for the comments in response to my enquiry. I’m still sure I’ve not got a proper understanding. If we look at HMWO on Morningstar, the index (MSCI World) and the index the ETF aims to track appear to be the same ( unlike VWRL which aims to track an FTSE index). But there’s still a lot of apparent and consistent underperformance and as TA suggests the discrepancy is just too large to be credible. Is currency conversion part of the explanation? I’d expect currency gains / losses of USD vs GBP to come through as part of the index return when converted to GBP, which I think is Ivanopinion’s point. But the apparent performance seems miles away from that. Or is some odd USD / GBP currency hedging affecting the GBP ‘index’ returns? Or is the index on a total return basis (ie with dividends rolled up) being compared with a capital price return without dividends (surely not)? Maybe the Morningstar data is just unreliable?

  • 1925 Kraggash November 24, 2017, 10:29 am

    @Mikemusing

    HMWDl (the $ version of the same fund) matches the index exactly, so it looks like it is just currency exchange rate changes.

    K

  • 1926 ivanopinion November 24, 2017, 11:02 am

    @Kraggash
    FX should have generated 20% outperformance over the last five years, so it can’t be the explanation for a significant level of underperformance. Unless HSBC is doing the currency translations by using one of those booths at the airport…

  • 1927 ivanopinion November 24, 2017, 11:10 am

    @Mikesmusing
    AFAIK, HMWO does not use currency hedging.

    How does the comparison look using other information services?

  • 1928 ivanopinion November 24, 2017, 11:26 am

    On Just ETF, you can view the growth with or without dividends. Comparing this with Morningstar, I think they are excluding divs from HMWO, but including it in the index. That’s poor.
    https://www.justetf.com/uk/etf-profile.html?isin=IE00B4X9L533&tab=chart

  • 1929 PA November 24, 2017, 11:27 am

    RE HMWO issue
    – here’s the HSBC factsheet location – shows small index tracking difference!
    http://www.etf.hsbc.com/etf/attachments/uk/factsheet_world_retail.pdf

  • 1930 Rob November 29, 2017, 12:45 pm

    I recently tried to transfer my stocks and shares isa to iweb in specie. I finally received a response from iWeb telling me that they can’t receive all my investments/ etfs as they don’t have all of them on their platform and asked me to liquidate these and transfer as cash. I contacted them and said I don’t want to liquidate any of my holdings because that was my portfolio and I wish to keep it as it is. They said they would therefore be unable to accept my ISA transfer to them. For example, the etf SGLP, source gold, is one that they said is one they are unable to have on their platform. Seems to me iWeb has some limitations as to what they can have on their platform. Seems very strange to me but I’m back to square one and need to look around again for another platform to transfer to and start the transfer process from scratch all over again, simply because iweb cannot hold all of my current etfs. Has anyone else had this experience with iweb or with the etf I mentioned? And why is this even happening with mainstream etfs? Seems very odd I think.

  • 1931 PA November 29, 2017, 1:04 pm

    @Rob – not directly related to iWeb but some time back I transferred In Specie to II and I had to sell a fund before a cash transfer could be made. Not all platforms are identical in terms of funds,ETF and IT being available

  • 1932 Kraggash November 29, 2017, 4:39 pm

    @Rob
    Yes they sometimes do not have funds that I want: usually I can find an alternative. In your example, would SGLD do? (same fund, but in $)

    When I have queried one or two in the past, iWeb said it was because the fund was not approved by iWeb as it did not meet their (legal, financial or construction) requirements. Maybe BS, I dont know. iWeb use A J Bell trading facility, and A J Bell themselves (via Youinvest) did trade the funds I wanted.

    On the whole, I would much rather have the savings and maybe not EXACTLY the fund I wanted.

    As PA says, it is common that not all platforms trade all equities – Fidelity being a major example – so it is best to check all your holdings are traded on the the platform to which you plan to move ahead of time. Then find alternatives in needed, and possible.

    K

  • 1933 Neverland December 2, 2017, 5:36 pm

    OK, so this a bit a niche question: anyone know a low cost UK broker who will allow you to buy shares on the Euronext Expert Market, formerly the Belgian Public Auctions Market for unlisted securities?

  • 1934 Jeffrey Beranek December 2, 2017, 7:04 pm

    @Neverland: I don’t think you’ll find a low cost UK broker for Euronext Expert Market. These appear to be the only brokers operating there: https://www.euronext.com/sites/www.euronext.com/files/euronext_expert_market_specialist_list_11_03_2015.pdf

  • 1935 Aidan December 5, 2017, 9:51 pm

    @Rob I had a similar problem with iWeb three years ago not offering SGLN (iShares Physical Gold ETC GBP). Their response was:
    “It is our policy not to trade two lines of the same stock. There are various reasons why we have made this decision, but the main reason is that it can interfere with the price feeds that we receive from the market, which may affect our ability to trade.

    Additionally, holding more than one line of the same stock can complicate both potential dividend payments and corporate events, which may only apply to one line of the stock.

    We would always try to offer the UK listing in the first instance, however if we currently have clients that hold the international line of a stock, we would not offer trading in the UK line. Situations like this can arise when an ETF originally trades in US dollars and then subsequently creates a listing in GP pounds. ”

    I wasn’t prepared to pay their 2 x 1.5% $ conversion fees so I bought SGLN with AJ Bell and X-O instead.

    Talking of FX fees…iWeb charge 1.5% and AJ Bell charge 1%. I hold VFEM with both and it pays a $ dividend. Now you would expect me to get less with iWeb wouldn’t you. But the broker doesn’t do the FX conversion for this share, the market maker does. I get on average .5% more with iWeb, the exact opposite to what you would expect based on the advertised fees. So much for transparency.

  • 1936 Neverland December 6, 2017, 2:03 pm

    @Rob

    Having been on iweb a while I think their underlying platform is pretty old (they changed the appearance a bit recently but I think that was more a facelift than surgery)

    I would rather have a platform charge of GBP nil and GBP 5 dealing with some restrictions on what I can get hold of than pay GBP 100 platform fees and GBP 10 dealing to be able to buy almost anything

  • 1937 Rob December 8, 2017, 8:38 pm

    Thanks for the responses. Very interesting and helpful. I was happily doing well with TD Direct as they had no platform fees, no account fees and no exit fees! All I ever paid was commission charges, albeit a bit on the steep side. With the impending merger into ii I was faced with the onset of both new account charges of £90 p.a. plus potentially around £200 in exit fees if I ever felt the need to leave in the future, albeit with some convoluted trade credits system whereby they “reward” you with a free trade for every £10 of account charges. I decided it was all a bit too unnecessary hence I decided to start my search for an alternative platform. I was drawn to iWeb for its simplicity and what are effectively low and straightforward charges – a £5 charge for each deal and an initial account fee of £25, which was ok. Then I discovered, a few weeks after starting the account transfer process that they did not hold a couple of my etfs. It is for reasons which have now become apparent (thanks to your responses!). I’ve now discovered IG as another alternative. I’ve checked and they didn’t have all my etfs but, within 48 hours of asking, they just added them! So now, I have a platform that has, or is able to add, all my etfs! The good thing is, there are no account fees, no platform fees and no exit fees – just a standard dealing charge of £8 (or £5 under some circumstances). Seems a no brainer now, but unless I am missing something, IG is in the process of receiving my account transfer from TD and I will end up with nothing but low commission charges for trading and no other charges. Not sure what my experience will be with IG once I’m migrated over, but at least unreasonable or complicated charges won’t be something I’ll need to worry about. Thanks again for the responses.

  • 1938 Marius December 9, 2017, 5:31 pm

    Fidelity have just changed share dealing fees (this affects Cavendish Online as well): instead of 0.1%, it is now £10 per deal. Funds are still free to deal.

  • 1939 FidelityCustomer December 10, 2017, 1:27 am

    @Marius (comment # 1938) : To qualify a bit further re Fidelity: The new £10 charge per trade seems to be applicable only to ISA and regular trading accounts (non tax shielded accounts). For SIPP accounts, they seem to have left unchanged the 0.1% commission for trading ETFs and Investment Trusts.

    https://www.fidelity.co.uk/investing/fees

  • 1940 I Eedapp December 11, 2017, 6:47 pm

    I’ve just found out that the new “upgraded platform” for iii has thrown security completely out of the window. They’ve actually reduced the security level that was available on their previous platform. Passwords are now a MAXIMUM of 12 characters and can ONLY consist of letters and numbers.

    This is completely shocking, so now I’m looking to switch out ASAFP. Please look at adding a column for “security level” so people can make an informed decision about which morons they choose to hold their money.

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