Firstly a word of warning: After my piece yesterday about Central Banks and all their support for and buying of various assets it made me think about the fact that the Government is doing this with ISA's in addition to their efforts in the housing market with Help to Buy. Seems they want to keep encouraging everyone into buying assets into rising markets presumably to keep the wealth effect and feel good factor going? So if you are going to buy a NISA - make sure you are going in with your eyes open and that you are in investing for the long run (one definition = a short term investment that has gone wrong!) as shares can go down as well as up as they always say. One way around this is to drip feed the money in monthly to benefit from pound cost averaging, but at least an annual contribution to an ISA will also smooth out the fluctuations - but mind how you go and click the image below to read the article from which the graphic came. Then see below for my thoughts and other articles on ISA platforms. ISA Platform Review
With the forthcoming launch of New ISA's in the UK in July 2014 I have been reviewing my options on this front and thought I would share my thoughts with you which hopefully you might find useful. The limit has been raised to £15,000 per annum a useful sum if you can afford it - so what is the best way to go with this. Well as ever it depends on your circumstances and you may want to get advice and you can pay your money can take your choice, but for what it's worth here are my views. As an active Share investor I am more interested in the Self Select type broking offerings rather than the more fund orientated platforms, but I will touch on those, but in any event most seem to offer shares and funds to a certain extent but you'll need to check how each meets your particular needs. For me as I like to nail down my costs I was ideally looking for either flat or no fees for using the wrapper or platform, coupled with a low / flat commission rate and hopefully a good name / financials to back it up as I wouldn't want to trust my funds to some unknown outfit. The other consideration I had was whether I might want an advisory service at some point in the future so was that on offer and also the coverage of markets and funds although the later (apart from ETF's and IT's) is of less interest to me. So I'll break this review down into three sections with a couple of suggestions in each category plus some links to some press articles which have good information on this subject. Cheap Share Dealing / Low Charges - good for active investors in shares with portfolios of all sizes. I was pleasantly surprised to be able to identify some cost savings here despite most commission rates clustering either side of £10, although some do offer lower rates for particularly active Timmy Trader types. The two clear winners here for me were: I-web-sharedealing.co.uk - which offers £5 dealing commissions and no annual charges apart from a £25 opening fee for the first account you open. I also liked the fact that it is backed by Halifax Share dealing service which is part of the Lloyds Banking Group - surely they won't need to be bailed out again and presumably they are too big to be allowed to fail? X-O.co.uk - came in a close second for me with £5.95 dealing charges, no annual fees and backed by £56 million market cap. AIM listed Jarvis Securities Plc (JIM). They are a Kent based stock broking firm who have been doing well and are focussed on this business and the balance sheet is fine but it is tightly held as the Chief Executive owns over half the equity. Stock Broking Firms with Advisory Services Available if required Probably plenty to choose from here but two that seemed OK to me were: Charles Stanley Direct - offers dealing commissions of £10 on shares with funds free. They charge 0.25% for fund holdings or 0.15% if over £500,000 held. However there is no charge on share investments if you deal six times in each six months. It is a firm I have used in the past and they have been around for years. They are a London listed Company (CAY) with a £187 million market cap. YouInvest - which offers dealing commissions of £9.95 and a 0.2% admin fee capped at £50 a quarter or £200 a year. This is part of A J Bell which was founded in 1995 and has grown to become one of the UK’s largest providers of online investment platforms and stockbroker services. With more than 95,800 clients and assets under administration exceeding £22 billion, we succeed by providing award-winning investment products, backed up with excellent service and online functionality at a low cost. The shares are unlisted but the Chief Executive owns around a third of the shares. Platforms which major on funds but offer full scope Not something I spent a lot of time on as I'm more interested in Self Select and their % based platform fees tended to put me off but the obvious candidates are Hargreaves Lansdown - everyone knows them don't they click the link if not and to check out their terms. £6bn FTSE Listed with big buying power in funds. Best Invest - probably not as well known as HL but they have good research on Funds if you want that. Seems OK but as I say the % fees put me off although the commissions on shares are reasonably competitive at £7.50. Unlisted and have recently been backed by VC firm Permira. Press Articles There was a good one on the Daily Telegraph and also the Daily Mail which you can view buy clicking the links.
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