Broker comparison: cheap investment platforms UK

iweb are increasing their account opening charge from £25 to £200 from 16th March. For example see

http://www.iweb-sharedealing.co.uk/share-dealing-home.asp

£25 to £200?!

Glad I opened my IWeb a couple of months ago!

I sincerely do not understand this IWeb’s move unless they want to discourage new customers.

As the big boys on the whole successfully maintained their market share (some even increased!) then it was only a matter of time before others started following the leaders. :()

DW is right; I called up iWeb just now. You must have a dealing account with them to open an ISA and the account opening charge is for the dealing account. So if – like me – you were waiting to open an ISA with them next tax year, you can still squeeze in at the lower account opening charge by opening a dealing account *now*.

Incidentally, they are insisting I send identity documents and won’t accept a Post Office certified copy of my passport, but will accept a copy certified by a Halifax branch (no charge for that at least). But I called again to check and since I ‘opened’ the account today I am in at the lower price.

Sean – fingers crossed you were IDed electronically, sounds like you were. I got a rather snide web page up saying “in some cases we are unable to verify identity electronically”. I’ve e-mailed to ask them exactly what it is about my electronic records that screams “money-laundering identity thief”, but I doubt I’ll get a reply. Has anyone else opened an account recently and been/not been asked for ID by post?

The iWeb increase is scheduled for Monday 16 March. There are share dealing changes planned for Motley Fool “over the weekend of 14/15 March”. Both iWeb and Motley Fool seemingly operate under the Halifax Share Dealing umbrella. Are the adjacent change dates mere coincidence?

I’ve use iWeb since I started dabbling in stocks last year, as they were the cheapest. I asked them about the fee change, and whether it was a hike in price or perhaps to fund improvements to the service (I.E updating the 1990’s interface), and I got the reply “Management decided to increase the account opening fee in line with competitive products across the industry.” I followed up asking if they were staying at £5/trade and the reply was “There are no plans to increase the trading commission charge at the moment.”

I can’t imagine £25 opening fee and £5/trade is that profitable, especially when you compare with other companies. Just a jump to £200 is quite a leap. I know I certainly wouldn’t have opened an account with them this time last year is if I had to fork up £200 up front. Maybe they’re making the changes to eventually push everyone to Halifax’s main share dealing accounts? Who knows.

For an ETF-only SIPP (or in fact a non-funds SIPP), doesn’t AJ Bell Youinvest make more sense than suggested in the ‘Good for’ column? The annual fee is £100 over £20K v. £176 for Interactive Investor. Of course Interactive Investor’s fees include £20 of trades each quarter, but it is possible to do regular investment with either for £1.50. Currently the table seems to be suggesting that there is a hard break-point of £20k between A J Bell and Interactive Investor for ETF-only portfolios, but, if my analysis is correct, that may not be true for all scenarios. Have I missed anything?

@Fred,

There is no account opening fee if you only open a SIPP but if you later want to open a share dealing or ISA account you then pay a fee so if there is any possibility you might want to do that you should open the account online before the increase. It only took me 10 minutes to open mine.

Just open a share dealing or ISA account with them BEFORE Monday at a cost of £25. You only have to pay the £25 when you open the first account, after that additional accounts don’t have an opening fee.

This SIPP page says that “We waive the £25 account opening charge.” and, unlike the other account pages, it makes no mention of the £200 fee from Monday so presumably that will continue to be waived if you ONLY want a SIPP.

http://www.iweb-sharedealing.co.uk/products/Self-Invested-Personal-Pension.asp

It’s fantastic to have this table, I am feeling left in the dark by the ‘Good for’ column. Could we have some ‘Good for’ recommendations over the £60k mark? I’ve got £70k in my SIPP and £30k in my S&S ISA, and that’s before adding this year’s contribution. Currently I’m at Hargreaves Landsdown (mixed passive/active portfolio), but I reckon even CSD would save me decent money each year. TDD however looks to be more expensive..?

I am confused about The Share Centre. From their site it seems that the Trading account is £4 per month, not £1.80 as it says in the table above?

Hi,

I am confused about the platform fees mentioned for TD website. If i am investing in Vanguard Lifestrategy funds, will that incur the .35% platform feeds from TD?

Is TD still cheaper option to invest in Vanguard Life Strategy funds?

Thanks in advance,
Prem

Hi,

Apologies for not providing that info earlier. I am intending to do a lumpsum of 7k on the Vangaurd Lifestrategy, through my ISA limit . I am open to the possibility of a regular sipp, but havent made up my mind yet . Any thoughts on the cheapest provider will eb appreciated.

Thanks,
Prem

John,

Thanks a ton for a detailed explanation. Appreciate your help.

Cheers,
Prem

I was just looking at IWeb and noticed the £200 to open an account has just changed back to £25. I’m easily confused, so I could be wrong.

Hi All,

I’ve got about 45K currently invested in an ISA in a range of HSBC Equity trackers through Fidelity, with a monthly purchase of £700 on top. I’d quite like to just buy one world equity tracker (vanguard or something of that ilk) but my current selection is probably ok too.

Here’s a potentially stupid question, is the 0.35% Fidelity fee based on the current valuation or the amount I paid in? (I’m up about 10K on my inital purchase amounts) If it’s based on the valuation then i’m currently paying around £155 per year in fees.

I was hoping to use this table to see if I should either move my funds to another platform, or potentially leave them in Fidelity but start another account elsewhere. However I’m struggling to see through all the data.

I think with my current valuation a flat fee broker is the way forward. However the paragraph on flat fee brokers seems a bit out of date now that iWeb is charging £200 to open an account, does anyone know what the best buy in this area is now?

Thanks

I was looking at TD website , and it says no account charges, and .35% for funds pating trail comission more than .5% . So i if am looking to invest a lumpsum of 7k in the Vanguard Life strategy through ISA, woulnt TD be cheaper than the other suggestions provided by John?

I mean does Vanguard Life Strategy pays more than .5% trial comission, to incur the .35% charge from TD?

prem,

TDDI will charge you 0.3% pa, VLS is a fund.

Vanguard have never paid commission to anyone, one reason very few platforms would entertain them in the good old days of bundled pricing and kickbacks.

Is there any reason you are excluding InteractiveBrokers?
They are a ‘semipro’ platform (used by a variety of small hedge funds etc), and while not for the faint hearted (industrial-strength processes, which are not user friendly) they are:
– very cheap. £6/trade for FTSE; $1/trade for US
– very extensive. they cover almost all international markets of significance, and a wide range of asset classes. They have operations in UK, Switzerland etc as well as their base in the USA.
– very powerful. the reporting features in particular are customisable and very strong
– a cheap source of margin, if you like margin trading.
For the sorts of readers of your blog, I think they can be a good fit. I have used them alongside others for several years.

Very Useful.
On TDDirectInvesting
1) can opt to automatically reinvest dividend for FTSE350 for £1.50
2) FX is 1.5% (its 1.25% if more than £25,000 or equivalent)
3) For Swiss stocks its only by phone and is £52.50 per trade

Chris.

Don’t rule out Charles Stanley on the basis of their 0.25% charge on fund accounts if you don’t hold funds. They have no problem with accounts being managed online by approved family members. I also hold a LPOA and haven’t been required to provide any further information.

Their trading and platform fee mashup is a little quirky but they’re an excellent platform/broker and the account web portal is a little on the full feature/complex side of things but second to none for that reason imho. £10 a trade isn’t as cheap as iWeb, but their charges on share only based accounts are capped at £20 min. / £150 max. p.a. and if trading regularly (6 trades, over each 6 month period) this can be reduced to £120 p.a. which also fits well with an actively managed/rebalanced but not over traded account.

Just my two penneth.

Thanks John
I did look at Charles Stanley but I felt that I would always be influenced away from funds because of the percentage charge. I’m looking to generate enough income to pay for a nursing home from the proceeds of a house sale so the amounts involved are large enough that 0.25% still hurts. Relatively risk averse so balanced income funds are an attractive option.

@849 Bellabeck

Yep, I do. IIRC you can’t set up personal regular cash payments into the SIPP like the ISA., but the regular investing with whatever cash (£-instructions or % of what is left) will work.

My employer contributions do go in and seem to work! I assume you just lump the amount in using the Fund/Withdraw tool and either set a monetary amount to invest regularly from the cash pot, or invest the lot on a % basis.

All their forms are available from here: http://www.iii.co.uk/sipp/sipp-account-forms

It is not the easiest process, I agree, but seems to be working now for me now it is done.

@Bellabeck

Once the cash amount is determined, you can set them up online using the Regular Investments tab under each account you have with II.

http://s12.postimg.org/pykybzme5/III.jpg

Thanks for the response before.

As i’ve got about 47K in funds I realise that I’m quite near the 50K guaranteed to be returned if anything were to happen to a broker/fund etc.

I’m wondering if I could transfer all my old ISAs (2011-2014) to Halifax Sharedealing and pay £12.50 a year to let all those funds just sit there.

Then I’d open a 2015 ISA with Fidelity or Charles Stanley and begin accruing another pile of investments which would attract minimal costs as it would be a small amount of investment and they don’t charge to purchase funds.

Does anyone know if it’s possible to do this, or any reasons this wouldn’t work?

Thanks

IT > “P.S. on my personal experience I would avoid CSD.”

I’m with CSD and have nothing but praise for them, so far at least, as many others seem to as well. You’re the first person I’ve heard complain about them. If you don’t mind saying, what did they do that annoyed you?

@naive
A quick glance at line 1 of the comparison table above would have told you that in 5 seconds!

However, all is not lost if you do this…

Open a Cavendish Online account, set up your regular purchases at a cost of nil for trading and 0.25% platform fee. Make sure the class of fund you buy is also available on Iweb.

Just after the end of the 2015/16 tax year do an ISA transfer to move, at zero transfer cost, 90 to 95% of the fund to Iweb and pay, at worst, one £5 purchase fee. There may even be no purchase fee when it’s a transfer.

Repeat year after year.

I’m doing something similar with Charles Stanley Direct and Iweb except I’m putting a lump sum into Iweb at the beginning of the 2015/16 tax year then regular purchases into a CSD non-ISA account throughout the year then just before the end of the tax year I will simultaneously sell in CSD and buy in Iweb before pulling the cash back out of CSD and starting all over again. This will cost me two £5 fees in 2015/16 but I’ll do it with just one fee in March each year from March 2017 onwards. Obviously this requires a bit of surplus cash available (which I have) as there will be a period of about a week, whilst I await CSD settlement, where £x sits in both accounts.

I shut down my account with TD International in Luxembourg after they increased my account maintenance fee by 200% over night. Of all the risks I had examined and taken into account when I planned out my investment, this was not one that I had envisioned (15% rise perhaps, but not 200%). I complained to them but received no apology nor any real explanation – I can only assume that they have made a policy decision to dump on small investors in favour of large ones.

Vanguard Lifestrategy funds all carry a preset dilution levy of 0.1%, this information is readily available in their factsheets.

TD are also giving cashback of £75 if you switch over £10k (more if you switch £50k or more) from elsewhere and the page linked below says you can have both offers. I switched £11.5k from an HL ISA into my existing TD ISA so I’m expecting £75 cashback to more than cover my £25 HL transfer fee (I avoided HL’s closing fee by leaving a little bit invested to keep the ISA open) plus zero platform charges on the whole of my TD ISA until 2017.

http://www.tddirectinvesting.co.uk/special-pages/isa-funds-offer

@John Thanks!

@TA – thanks for the further explanation, makes sense why you don’t include it in the table. Cheers!

Are my eyes deceiving me or have iWeb put up their “one off joining fee” from something like £25 to £200?!?!? I was about to open an account for this new tax year and nearly fell off my chair looking at that … am i wrong in thinking this fee has leapt recently? Don’t know why i had £25 fee in my head for this …

@mikamola

See @Topman March 18 et al preceding.

On the last day of the tax year I opened my first platform account (with TD – based on the comments above about no fees until 2017) … and used my full £15k ISA allowance on a LifeStrategy 100% Equity Fund. Had a slightly nervous wait, since it was a Sunday the investment wasn’t confirmed until Wednesday – but all seems to have gone through ok.

For a newbie whose only previous experience was buying L&G funds directly, it was definitely a more fraught experience – I’m still hoping that I haven’t screwed up something!

Question: I now want to sell my L&G funds (4 different trackers), move to TD and buy more LifeStrategy 100% Equity Fund. On TD’s ISA transfer form there is an option to “Full transfer – Cash only (sell any investments and transfer as cash OR cash only ISA transfers)” … presumably this is the option that I should use ??

Hi all,

I’m in a similar situation to Grant above (i.e. have almost reached £50,000 in my current ISA, so am nearing the compensation limit). This ISA is currently held with Charles Stanley Direct (CSD) so I will get charged £10 per holding as an exit fee per fund if I move it, and is invested across 6 low cost index trackers. I am considering what to do next as I feel I should move this money (or keep this money is an open up a new account to start investing into) as I am now paying more on this account that I would be in others as I am over the £32,000 limit where are % of funds fee is the cheapest option, and I am concerned about going over the compensation limit. However, Investing Tortoise’s comment (above, and copied in below) has made me wonder whether I am wrong to be concerned about keeping more than £50,000 with an individual platform and rather should be think about investing money in different funds (be that with with the same platform, i.e. CDS, or a different one) as this is the primary concern. A number of my current investments are already with Vanguard though, which I think would nullify the point of keeping these and then also setting up a Vanguard Life Strategy fund. Unlike Investing Tortoise, I have been very happy with the service provided by CDS so far.

“Hi Grant,
Yes, that plan would work very nicely, it is exactly what I did. Actually Halifax also converted my funds to clean class funds, lowering the charges I on them paid too, making it even better.
With regards to the £50,ooo FSCS compensation limit, you may be overly worried. Halifax is a ‘too big to fail’ institution and was bailed out by the government after the crash. However, for compensation purposes, I found that the FSCS actually ‘look through’ to where the money is invested, so £50k in cheap L&G trackers and £50k in Vanguard both through Halifax is better than say£50K in L&G via Halifax and £50K in L&G via CSD. Confusing, but true.
P.S. on my personal experience I would avoid CSD”

As I see it my (best/safest) option may therefore be to convert my current investment (free of charge) to a Vanguard Life Strategy fund (to minimise the transfer charges) and transfer it to a flat fee broker (e.g. Halifax Share) and just let it sit there, and pay £12.50 a year for the privilege, then open a Cavendish account to start investing this year’s ISA allowance into (Cavendish is chosen here instead of CDS as it doesn’t charge and exit fee) and start to invest this years ISA allowance in that in non-Vanguard funds. It would be useful to know whether I am correct to this that this would be the best thing to do in my situation, taking “best” here to mean a function of safe (i.e. well protected, low costs, and generally sensible. If you don’t think it is, please let me know what you would do in my situation / what I should do in this situation?

More generally though, how much should keeping my investments as “protected” as possible affect where I hold them? If it is the fund provider, (rather than the platform), that should be taken into consideration, I feel that many people, especially (very sensible!) Monevator readers, must have (significantly) more than £50,000 held with Vanguard and therefore it is not something that people consider too highly…..?

Any advice on this would be very welcome!

BW,
Emma

@ ADS (& @ Accumulator),

This is a subject close to my heart, as I have made similar transfers (specifically, from directly-held L&G unit trust ISAs to both TD Direct & more recently A.J. Bell), in the past.

The Accumulator’s article is very helpful and I wish he had published it prior to my transfers as it is exemplary in outlining the transfer process mechanisms and pros & cons of the different options, all of which took me some time to piece together myself!

I actually opted for the “sale and cash transfer” option for both of my transfers and was happy with the outcome each time. I recognized the opportunity cost of an unknown-in-advance time out of the market but decided that this was outweighed by the fact that if I went down the route of an in-specie transfer, I would have to pay fund dealing fees to the recipient broker to sell each of the incoming fund parcels, before being able to re-invest the proceeds into new investments; opting for the “sale and cash transfer” option meant that L&G sold the fund units for me “for free” and the cash then arrived unencumbered and ready for redeployment.

From personal experience, the other factor in favour of a “sale and cash transfer” would be speed: in my case, I seem to recall both transfers were completed within about two weeks, I suppose due to the relative lack of paperwork vis-a-vis a fund transfer.

From the comparison table above it looks like you can currently deal funds with TD Direct for free, so in your case an in-specie transfer might indeed be the best option, as it would minimize your time out of the market for no addition fee impost. If you go down that route, I’d be interested to hear how long it takes the brokers to complete it!

Anyway, hopefully food for thought as you weigh up your options.

Cheers!

@ David, Emma & John,

I think you may be overly worrying about staying within the FSCS compensation limits. There are all sorts of risks you face as an investor, I think exceeding the FSCS limit this is a very small one in the great scheme of things.

Twenty years ago, I had a modest investment in a unit trust run by Barings Unit Trust Management, just as an ordinary retail investor. The big Kobe earthquake in Japan caused the Japanese market to plunge. Long storey short Barings Bank went under, the parent group was sold for £1 after a rogue trader broke the bank betting the Japanese market would only go up! My investment was fine though, all nicely ring-fenced through the unit trust and I didn’t lose a penny.

Yes, I have spread my money over a number of different platforms and into different fund groups, I pay slightly more in fees, which I regard as a small insurance premium, but don’t unduly worry as long as you have spread your money round sensibly. (Ultimately you want your investments to go up, so they will eventually blow the FSCS limits given enough time.)

I do prefer funds to ETFs, sharing The Accumulator’s thoughts on that, here: http://monevator.com/etfs-vs-index-funds-differences/

I did send an email to Monevator Towers regarding my experience with CSD, since I thought it could be a good source for an article. I got a nice reply back from The Investor. Not sure I want to go into details here, sorry, but there are other things to consider besides the costs of brokers.

@ Investing Tortoise, King of Kelsall and The Accumulator

Thank you very much for all of your feedback. I now have a much better understanding of what the issues that I need to consider are and the relative importance of them

@ The Accumulator, thank you for clarifying that there are two different types of potential risk in terms of institutions defaulting and for posting that article – it is not one I had come across before and is very informative

@ King of Kelsall. I have looked into the options and though I understand your reasoning for going for a cash transfer I think I have decided to go down the in specie route to avoid time out of the market. I’ll get back to you on how long it takes

@ Investing Tortoise, it is very interesting (and re-assuring) to hear your personal experience on this matter. Thank you for sharing and also for putting the risk in perspective – I thought I may be getting a bit het up unnecessarily but sometimes you just need someone to point you in the right direction!

Thanks again for all the feedback.

BW,
Emma

Great analysis, I’ve just moved over from Selftrade to AJ Bell You Invest, as Equiniti’s acquisition looks like it’s going to hike up Selftrade’s already expensive fees. Interesting to see some of the even cheaper options like XO. Thanks again for putting this together – only wish I found it a month or two ago!

Close Brothers seem to have changed their standard charges but I’m not quite sure when they did that (note I’m talking about charges from 1st January 2016 when the 0.25% platform charge offer expires)

Their standard platform charge on shares and ETFs seems to be now 0.25%pa (not 0.35%pa)

Their standard platform charge for funds (i.e. post 1/1/2016) is 0.35%pa, but I can no longer see any mention of a lower charge of 0.25% for funds over 50K. That could still exist but I can’t find mention of it anywhere in their literature so I’m guessing it’s gone.

It seems like II are having a complete meltdown at the moment – my recent direct debits have not been taken. Upon continual chasing, it turns out they had a system failure – or at least their SIPP administrators did – over Tax Year End.

I know, you can’t make this stuff up…

Not sure if it is related to your tax relief payments, but, they said they had a back log of payments they were working through and are slowly getting through them. Not sure in what order though, as my regular (amended) direct debit was taken but the same form had a one-off contribution on and that hasn’t appeared yet!

I’ve not seen much mention of Halifax in this thread. I’ve used them for over 10 years for my stocks & shares ISA and I’ve been very pleased with them. I’m now thinking of opening a SIPP and wondered what other people’s experience of the Halifax SIPP had been. I’d go ahead without asking if it was a Halifax in house product but it looks like a rebadged white label product from AJ Bell. (but with a fixed fee).

I just got another response from II. They say their SIPP provider, The Lifetime SIPP Company (TLSC), says ‘HRMC is undertaking a review of the II SIPP, as part of its standard processes’ and that ‘During a review, all communication takes place between TLSC and HMRC, and no payments are made to any members of the SIPP’.

This all extremely worrying. Really wondering now whether to completely stop payments, and open and HL account. Also, the 0.45% fee or ETF trading charges from HL could well be less costly than the out-of-the-market impact from the delayed tax relief.

I have also been experiencing similar problems with my II SIPP (which I used have with H-L until some time last year). I am self employed through my limited company and make gross contributions from my business account. However I have noticed that the last two contributions necessitated many phone calls before they appeared in my SIPP account. I then decided to go automated to avoid all these phone calls and set up a direct debit, starting from today (1st May).

Today the first direct debit payment has gone out of my company account and gone straight back in. I phoned II but I was told that RBS (the bank which their SIPP provider, whoever they are, use) was rejecting all direct debits. This does not sound plausible – I am going to try to speak to someone at the FCA to see if they can throw any light on what’s happening at II

Have you got a contact e-mail for Paul Lewis / Money Box – I will use the same one too to highlight the situation and mention my own experiences with II

I got in touch with the Money Box programme via their website.

Hi,

I am planning to setup SIPP for myself and my wife, from the limited company. We dont have any existing SIPP accounts. I would like to invest my SIPP in to Vanguard Funds.

I assume Best Invest is the provider i should go with, based on the .30% fees, (and no fees for regular investing), though Bestinvest doesnt provide family linked accounts like II (not sure whether II treats 2 different SIPP for same address as single account or multiple).

Thanks,
Prem

@Prem. Best to ask them to be sure (sipp@iii.co.uk) – they are quite quick at responding to new customers (not so quick once you become a customer). Certainly the (II) quarterly charge/credit does get shared across family accounts which include one sipp… Meanwhile, I think the Selftrade SIPP looks attractive.

Thanks for the update. My wife’s SIPP with II hasn’t received tax relief since we opened it late last year. I’ve been in touch with The Lifetime SIPP Company (II’s SIPP administrator) who have assured me the issue with HMRC is resolve, with tax relief due at the end of this month.

II’s pension transfer process has also been painfully slow, although there seems to be some movement in that respect too.

Just curious, why have you removed Fidelity from the chart? We used the older version of this chart to help us choose a SIPP to transfer a couple of company pension pots. Fidelity fitted the bill – charges less than HL and they are easy to deal with!
The chart has been an excellent tool for us over the past year for our ISAs as well! Thanks!

@Neverland – “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.” i.e. £1.50 per trade is the baseline. Hope that helps.

@ABC1 Looks as if Interactive Investor may finally be getting their act together.
From their customer services: ‘I have spoken to our SIPP administrators who have received your new form, they have signed off the form and cheque and currently are waiting on the cheque to clear. The cheque should clear at the latest Thursday 28 May and once the monies have cleared our SIPP administrators will forward the monies to us and we will apply the monies to your SIPP account.

Thank you for your patience in this matter and once again I am sorry for the ongoing delays and issues you have been experiencing.’

also re tax relief
We are aware that you have experienced delays in the payment of the tax relief on your SIPP. We would like to apologise for not contacting you before now, while we have been investigating this matter.

Your monthly tax relief claim to HMRC is made by our SIPP provider, The Lifetime SIPP Company (TLSC). You will be aware that your last payment was made in October 2014, relating to contributions made into your SIPP up until 5th September. TLSC has continued to claim the tax relief on your behalf on a monthly basis, but no payments have been made by HMRC since this date.

We have been advised by our SIPP provider that this payment delay is because HRMC is undertaking a review of the II SIPP, as part of its standard processes. During a review, all communication takes place between TLSC and HMRC, and no payments are made to any members of the SIPP. In addition, the time frame of any review rests entirely with HMRC and is, unfortunately, completely out of our control.

TLSC has been in constant dialogue with HMRC over the period, most recently meeting with them earlier this month. HMRC has confirmed that it has all the information it requires and we are now anticipating an update from HMRC in May.

We recognise that this must have caused you some concern and thank you for your patience. We hope you will understand that our primary goal has always been to get to the facts of the matter in order to share these with you. We will be in touch in due course to update you and ideally confirm the payment date of your outstanding tax relief.

Still no sign of Interactive Brokers (IB)? For my money IB are the cheapest and most powerful broker for non-ISA accounts for UK folks. Very wide range of markets, lowest fees, most powerful reporting. Not an easy interface but worth learning.

Nice one David! Much obliged.

@ Fire – the main problem I have with IB is I’m not confident that I know what their fees are when trying to fathom their charges schedule. Not a great sign really. I can see that it’s a powerful platform but I don’t think it really fits with Monevator’s investing ethos which is primarily about simplicity and passive investing. I’ve taken out Saxo on the same grounds. The International Investor has a good write up on IB re: international share dealing. I would certainly give them a much closer look in this regard.

@Accumulator – I don’t want to flog a dead horse, but I think you are underselling Monevator. While yes I appreciate its ethos towards simplicity/passive, it also has a lot of respect / use from ‘power users’ who indulge in active investments; but power users can be as fee-sensitive as the best of us. And for active investors IB is, I believe, very worthy of consideration – perhaps you could list it but flag it as unsuitable for passive / inexperienced investors? By the way on fee confusion; you can safely ignore the Tiered Commissions IB quotes, which are for the real pros; just look at the Fixed Tier pricing for European stocks https://www.interactivebrokers.com/en/index.php?f=commission&p=stocks1#europe – GBP trades under GBP50k are fixed at £6 per order. USD trades are half a cent per share, min $1. All my trades (which range between £2k and £30k) cost either GBP6 (plus stamp duty) or USD1. There is a $10/month minimum fee and $10k account minimum.

I would “second’ those comments… hasn’t your right hand man at arms The Investor been writing recently and persuasively about how Monevator is a broad church that welcomes all denominations… provided of course they will take their sermons… alright I will say have their faiths challenged… from time to time as a tithe?

Of course one appreciates there are only so many hours in the day…

…especially when one is still presumably very much occupied Accumulating…

I applaud your efforts here but as one of those woe betide active addicts you will have at least two interested parties in the dealing space… and I am sure many more…

(To The Investor… you see I’m still not dead yet! Best, OP)

@ Fire – I’m looking at IB and have a couple of questions if you wouldn’t mind clarifying:

Is VAT applied to the dealing fee or minimum charge?

Do you have to buy for data or is there a free service you can get by with?

The min US share fee is listed as $5.

The 10K account minimum appears to be to open the account. The monthly activity fee then increases if the equity balance falls below $2K.
Can you confirm?

@Accumulator – My understanding is
1) VAT. No VAT. Does any broker charge VAT on dealing fees? I definitely haven’t been charged it by IB.
2) You don’t have to buy data. They have delayed information services which are free and work fine.
3) Min US share fee is $1. It is half a cent, i.e. $0.005, per *share* – i.e. if you buy 100 AAPL stock for $14000 then this amounts to 50 cents; you will in fact pay $1 as the minimum fee. My understanding at least.
4) Minimums. Yes I think you are right; they don’t want your equity balance falling below $2k. Can you blame them?
Other minor points:
– you can participate in a stock lending programme which usually rebates me a dollar or two a month.
– IB’s reporting is *excellent*. I have never seen anything nearly as good with others. Cf Selftrade who don’t(/didn’t, RIP) even provide a capital gains report.
– for multicurrency accounts (or for Forex trading, which I regard as the work of the devil, but no matter) their currency switching rates appear to be vastly superior to the $scams perpetrated by other online brokers I have used.
– yes the website is slow and crotchety but it is powerful.
– their margin is very cheap. They will lend modest (<$100k) sums at 1.5% above base in both USD and GBP. And if you want to borrow a couple of hundred million, apparently you pay only 50 bps above base – I haven't tried it myself 😉

Thank you for providing this excellent comparison guide. Most accounts are so expensive; I’m glad to see a few cheap ones (at least for ETFs) at the end.

Hi – could anybody please answer a question I have about how this all works?

Let’s say you have a portfolio with 5 index funds or ETFs, and you put money in every month. How do the transaction fees work in this case: is it one fee for the entire deposit, one fee for each of your 5 funds/ETFs, or even one fee for each unit you buy?

Secondly, let’s say you want to do your annual or quarterly rebalancing. Again – can you do the entire rebalancing for one transaction fee or is it one fee for each fund?

Honestly, look at the table. It tells you everything about the basic charges at various providers, that’s why it’s there.

Aviva have just (soft) launched their direct to consumer platform called the Aviva Consumer Platform. Offering ISA, SIPP and dealing accounts.

At first glance (and this needs checking) appears to be 0.4% platform charge up to 200K (but no exit charges) and £7.50 for buying shares and ETFs.

Thanks John. I thing you are right on the charging bands.

Hi,

Thanks for this post, it’s really helpful. I wonder if anyway can offer me a bit of advice. I currently have a SIPP with Fidelity which is rapidly approaching 50k and I am starting to think about moving it elsewhere to see if I can save some money (plus I have other ISA’s with Fidelity so feel like I have all my eggs in one basket). Since they charge a platform fee I’ve not had to think about trade charges at all. Selftrade looks like it may be a good candidate but I don’t fully understand the charging model. I regularly invest every month and spread the investment across 7 different funds. Does this mean that I would get charge £1.50 per transaction/fund or just £1.50 flat?

Thanks,

Dan

@Accumulator – Thanks for clarifying.

@ M – I recommend The International Investor – it’s a fantastic resource for all your foreign share dealing needs.

Just to clarify my previous post re Fidelity charges as it could be read the wrong way. Revised charges are:

Portfolio is below £7,500: platform charge of flat £45
Portfolio above £7,500 (and below 250K): platform charge of 0.35%pa

@Prem – interested in doing something similar to yourself – opening a sipp with contributions from limited company. Also interested in investing in Vanguard. Did you open an SIPP with Bestinest and if so how is it?

I am with Fidelity through cavendish.There is no investor fees of 45 pounds on people who have invested via unadvised route as per their email.

Very true about ‘non-fee- comparisons. I’m with Interactive Investor also and have encountered slightly more serious problems including
– doing a cash rather than in-specie transfer of pension without asking me
– Waiting months for pension tax credit to be applied
I too have also chased about CTV, having previously been told end of July their answer is now Q3

I too am very unhappy with the response of Interactive Investor to my repeated attempts to obtain a Consolidated tax voucher for the 2014/2015 tax year. I first sought it in May of this year and was told it would be available in June. I went online this morning and was told their target now was September. I was also told that although the CTV’s for iii clients were complete they had not been signed off, and would not in any case be posted online until those for their Motley Fool clients were completed.
I said that this was unacceptable, placing clients at risk of late filing penalties, and indicative of a lack of sufficient resources to meet the needs of a burgeoning client base. I suggested they release the vouchers in a phased manner as they became available but their spokesman said they were determined to only post them when the very last one was verified. I said this amounted to a policy of treating all customers equally badly.

Always a useful reference of platforms based on cost!

ISA – the easier choice based on pure cost as less ‘complicated’ than SIPP
SIPP – the need to set-off the lowest pure cost as per table with service/features/cost when in/near ‘drawdown phase’

Issues I’ve considered:
>Saving 0.1% platform costs pa could be eroded by the costs of setting up/in drawdown on some platforms.
>Some platforms don’t offer UFPLS (a sign of poor IT systems?)
>Applying HMRC credits or dividends on time
>Platforms using 0845/0870 numbers increase call costs (prefer 0800/01/02 as included in mobile allowance)

The ideal dream : invest in lowest cost platform – free transfer – to best drawdown platform !!

As per what Pete says above, having looked to move some of my holdings from Alliance Trust Savings recently to get all my holdings together at II, exit fees to move brokers are the challenge for anyone with modest holdings.

Interactive Investor stopped doing their linked “family” ISA bonus sadly: those like me that got in before they closed it are sitting relatively pretty with half the published rates (the above quarterly charges hit my ISA, & Mrs LCIL’s ISA attracts no quarterly charges).

Many thanks for this very comprehensive table and hugely useful data. I have included a link to it in the Pension Provider Fees and Charges section of the UK Pensions Blog http://theukpensionsblog.co.uk/pension-provider-fees-and-charges/
Telegraph Investor is a relatively new capped flat fee provider that merits a look. Their fees page is at http://investor.telegraph.co.uk/pages/a/trading-charges
The Pensions Blog focuses on help for those managing their own pension, and therefore the fees charged by platforms for flexi-drawdown or UFPLS payments also need to be factored in by those seeking a regular income from their SIPP.
Personally I am with Hargreaves Lansdown as I really like their service, web site and customer service. However, their fees are very much at the top end and rationally I should be looking for a cheaper provider.

I’ve been toying with this for a while. Currently with Interactive Investor. Dont really make a lot of ‘ad-hoc trades’ so really only use the regular investment service paying into two or three funds/ETFs or IT’s a month, which means over a quarter the dealing charges are covered by the quarterly charge of 20 quid (which can be used as trading credit). Don’t have my sums with me but remember when I crunched the numbers a few months back I’d be better off with commission based provider as it stands. However if my portfolio grows as planned I’d hot the point in a year or less when the flat fee system is more efficient. So I think I’ll stick at the moment.

That said one factor I want to consider at some point is our old friend diversification. Remembering it does not just apply to our portfolio structure in terms of asset classes, but also to where we hold our money. So is there is an argument for considering spreading risk between platforms. Have we had a major collapse of a provider yet – what happens if one goes? How easy is it to get your money back? (I download excel statements every month and keep all records BTW just so I have records in case of technical problems etc). Call me ‘Mr. Pessimistic’ but there is always that chance……..

@M from There’s Value @Krismarett

Note the compensation limit for investments (e.g. platforms, fund providers) is set at £50K per institution, not £75K.

IIRC The £85K limit just applies to banks/building societies etc (which is due to be reduced to £75K from January 2016).

Though yes it’s definitely worth diversifying (even when below the limit to allow for growth, and/or being able to get access to some assets [e.g. if one of your providers goes bust, you don’t want it to be the only one holding your assets while you wait for compensation]).

I’m sure there are other reasons too, and there are definitely articles on this site going into this further.

@ grey gym sock – thank you for that! Good point. Will add that in. I also read today that Degiro is regulated by the Dutch financial regulator and not the UK’s FSCS. In other words, compensation tops out at €20,000 not £50,000. I dare say it’s worth checking out the off-shoreness of any broker before you make your final choice.

@ Passive Pete – I don’t remember looking at Sharedeal active before. Am I right in thinking they only deal in shares and ETFs and therefore would sit in the Share Dealing Broker’s section of the table? If that is the case, their fees seem to be worse than the current crop listed. To keep the table manageable, I don’t list every broker in the UK. They need to offer something new and improved to get in. I could probably do with weeding out some of the less competitive entrants in the current table too. Thanks for pointing Sharedeal out all the same and let me know if I’ve missed something.

Thanks for the dodgy link report, Pete.

Wonder if Jarvis have been hoovering up brands and don’t quite know what to do with them all? Back in the day, iweb used to be much more competitive than Halifax even though it’s owned by Halifax. Not a huge difference between them now.

It’s early days but interesting to read that Vanguard are looking to set up a (D2C) platform in the UK.

http://www.fundweb.co.uk/news-and-analysis/vanguard-to-launch-uk-d2c-platform/2023823.article

Hi John,

Bestinvest doesn’t charge you for making purchases into funds so you’re absolutely fine to make a monthly contribution. There is no cost.

I’ve just joined the company SSAS and the administrator is asking me to pick a provider to deal with. Has anybody else in this position found a fixed-fee broker to deal with who is happy to accept a Trustee Investment Plan?

Without wishing to turn these comments into a bash-your-least-favourite-broker, anyone considering using Interactive Investor should tread very warily. Having missed the latest in a series of dates to produce Consolidated Tax Vouchers, they now admit they have no idea when (if?) they will arrive. That puts them 5 months late and counting in my book. Plus they can’t seem to take my fees correctly. Plus they take ages to respond to (simple) queries (last email response took 9 days, and it was waffle). Plus they sometimes spontaneously take actions on my account, without even notifying me. Etc. I’ve had enough, and have started moving my accounts elsewhere. They’re not very good at that either 🙁 Their fee structure is fine, and their regular investment options are excellent, but if you want even a basic level of service, look elsewhere.

Hi. Can anyone recommend a trade dealing accout that allows to trade on us otcbb market?

Not just First Direct – the change (unsurprisingly) applies to HSBC InvestDirect and InvestDirect Plus customers as well.

I only hold a single shareholding in the HSBC InvestDirect account (to qualify for Premier, which I’ll now just downgrade to Advance as I don’t use any of the Premier-only benefits).

Having looked at my options and what I have elsewhere, I think I’ve decided I’ll top-up my HSBC InvestDirect trading account with cash and transfer the account to HL given
– share only, so no annual fee
– cashback offer, which easily outweighs the exit charges if and when I decide to take the account elsewhere, so effectively paying me to have the HL account there!
– infrequent trading as I typically just dump Sharesave shares into the account that are in excess of my ISA limit.

I suspect I’m in the narrow sweet spot for the HL cashback offer – I obviously wouldn’t have wasted any time considering them if the account I was transferring was an ISA.

I got my letter from HSBC today about the new £10.50 quarterly charge so the letters must still be going out.

The degiro charges are lowest for USA but they don’t have any isa wrapper.
https://www.degiro.co.uk/

Hi Tony,

Thanks very much for your thoughts and the link.

By way of counterpoint, I’d just like to say that I’ve used iWeb for many years now and had no problems with them. I think that service can often be a total lottery but it also depends on expectation. My demands on iWeb are very low, my affairs are simple, so they’d be hard-pushed to mess up on my account. Their website is an ugly beast though.

@Lydgate – the table above says it’s £0 to deal in funds on Selftrade… so why do you have to pay £1.50?

I think it would be useful to split your percentage fee brokers / platforms into two categories: “Capped” and “Uncapped”. If you are above the cap level you are really on a Flat Fee and should be comparing to Flat Fee and other capped offerings. It might also be useful to document how much you have to have invested before the cap applies.

@mikamola Yes that’s the exact fund I’ve purchased in a Shares ISA: Vanguard Investments UK Ltd Vanguard LifeStrategy 80% Equity Fund Acc, symbol VVLSRE. I made the first purchase in September and the last one just went through today. I seem to recall that I had trouble buying that fund previously (a year or two ago) but it seems to be working now. The purchases take several days to execute, but they’re free, and I’m not fussed about the timing as long as they work.