Investment platforms are widely used by DIY investors to house their investments. They can offer access to a full range of investment options such as ISAs, pensions, funds and shares, and allow the investor to house everything under one roof. However, with over 30 DIY platforms to choose from, deciding which to use is no easy task. It can depend on the kind of investments you have and the level of service and support you’d like.
But what can really tip the balance are the different fees charged by each. Until now, investors have had to find out these costs from each platform individually. Now, for the first time, comparetheplatform.com enables investors to get real-time insight into the costs charged by different investment platforms and to compare them all in one easy-to-use, price-comparison tool.
There are various fees that are charged by investment platforms. Most will charge an annual fee and dealing fees if you choose to buy and sell stocks and shares. Occasionally, some charge a set-up fee or product fees. And most will have exit fees if you want to move your investments elsewhere. Typically, these costs average 0.8% annually. However, the comparetheplatform.com calculator shows that an investment of £10,000 can see annual charges vary from just £12.50 to £153.60, whilst the difference in charges can be as high as £1,900 on an investment of £100,000.
Bella Caridade-Ferreira, Founder of comparetheplatform.com said “Investors wrongly assume that platform costs are broadly the same, but fees can vary by a huge amount. Of course, price isn’t the only factor, but we help to clarify costs leaving investors to focus on what they want in terms of products and services.”
Caridade-Ferreira went on to say, “This is just the first stage of the calculator. In the future investors will be able to compare platforms on a range of qualitative factors such as service, investment choice, and more. It’s about time investors were able to make informed choices.”
Making informed choices
The following two examples provide some insight into how using comparetheplatform.com can help you save money on platform fees.
A novice investor has inherited £10,000, which he wants to place in a stocks and shares ISA. Running the calculator yields the following results:
Should the investor choose Halifax over the iWeb, he would save himself nearly £190 per year in platform charges.
An experienced investor wishes to shift £100,000 of investments onto an investment platform. Of this amount, £10,000 is in stocks and shares, and plans to trade 12 times per year. She expects to invest her annual allowance of £15,240 into ISAs in the future. Running the calculator yields the following results:
The difference in fees charged between the cheapest and most expensive platform is over £1,000. Over a 10-year period, this difference can escalate to over £8,800, as a result of dealing fees on the more expensive platform.
How the calculator works
Whether you are a novice investor or a seasoned expert, comparetheplatform.com has been built to cover your needs. The calculator takes you through a series of simple questions about your investment requirements: how much you have to invest now, how much you are likely to invest in the future, what kinds of investments you would like to make (and if you don’t know, it can make some assumptions for you), and whether or not you would like to actively trade in stocks and shares.
Based on the kind of investments you wish to make, it then reviews the fees for the relevant investment platforms in the UK, and gives you a summary of their costs. The user-friendly results page allows you to tweak your investment inputs so that you can easily review the results for different scenarios. And you can name and save your searches for future reference. Importantly, by inputting how much he or she plans to save, the investor can also assess whether the platform will be the right one in the future.
The calculator provides details on both DIY and advised platforms. It can be used by advisers as a tool to validate their platform choices for different customers.
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Notes to Editors:
Comparetheplatform.com is a Fundscape brand. It was set up by Bella Caridade-Ferreira, CEO of Fundscape, industry leader in providing reports, analysis and data on the investment fund industry, to provide real-time insight into the costs charged by investment platforms. Launched on 3rd November 2016, comparetheplatform.com is completely independent and impartial, with no links to any of the platforms mentioned on the website.
Established in October 2010, Fundscape is a research house specialising in the end-to-end research and analysis of the UK fund industry. It is the publisher of the quarterly Fundscape Platform Report, widely regarded as the industry benchmark for platform data and statistics in the UK. With many years’ industry experience, its team is well placed to provide unique insight into asset management and distribution trends, including product development, distribution and marketing.
For further information or background please contact:
Bella Caridade-Ferreira tel: +44 (0)20 7720 1183 email: email@example.com
Trish Lucey tel: +44 (0)20 7720 1183 email: firstname.lastname@example.org
Gayle Harrison tel: +44 (0)20 7720 1183 email: email@example.com