Friday, June 15, 2012

Change in brocker's term

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A number of other brokers have recently increased charges or introduced inactivity fees. Several firms are also making changes to how client money is held (moving client money from a number of different banks into a single bank), and one firm is closing its stockbroking business altogether.

As a result transfers to our Vantage Service have increased. This has highlighted two key benefits of the Vantage Service.

Low costs - so more of your money remains invested

There are no charges to hold shares (including investment trusts and ETFs) in the Fund & Share Account and no inactivity fees. The annual management fee to hold shares in the Vantage ISA or SIPP is just 0.5% capped at £45 (ISA) or £200 (SIPP) per year.

There are no dealing charges for funds and we offer initial discounts of up to 5.5% and annual savings of up to 0.5% (please note loyalty bonuses are not available in the Junior ISA or SIPP). There are also no charges to hold over 2,400 funds in Vantage. A minority of funds (mainly tracker funds) are subject to a platform fee of £1 or £2 per holding, per account, per month. You can check how much you will save or whether there is a charge to hold any of your funds using our loyalty bonus calculator.

For private investors low costs and charges are vital. This is one of the reasons we significantly reduced our share dealing commission last year to as little as £5.95 per deal online and never more than £11.95 per deal.

Security of assets - for your peace of mind

Given the financial crisis it is unsurprising that the security of assets is at the front of investors’ minds. Recent moves by a number of brokers to hold all their clients’ money with one bank has understandably raised concerns.

Looking after our clients’ money is a responsibility we take extremely seriously. We are now one of the largest companies in the country, we manage the business conservatively, we have no borrowings, and our audited accounts show financial strength.

Client money held in the Vantage Stocks & Shares ISA, SIPP and Fund & Share Account, is currently spread between six banks each with separate UK banking licenses and separate cover under the Financial Services Compensation Scheme (FSCS). We maintain a conservative approach and select only UK banks, preferring those which we believe the government would fully support in any further financial crisis. We do not use foreign banks as we feel some governments might be unwilling or unable to fully support their banks in any further crisis.

Are you considering transferring? It could cost you nothing

When providers change their terms, often transfers can be made free of charge for a limited period. If you want to take control of your investments and are considering transferring to Vantage, you should confirm the terms with your existing provider.

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