I have received an offer from Hargreaves Lansdown who will pay me £250 if I transfer my ISA which is currently with Alliance Trust. (1) Is it easy to say which charges the more. I hold aobut eight different shares and funds in the SIPP, mostly fairly mainstream. (2) Are there any risks attached. I already hae substantial holdings with HL, and am a little reluctant to put al my "eggs in one basket". Is it possibe for HL to fail, not that I have any reason to suspect they will, in a way which would result in client money being lost?
System of Law: England-and-Wales
More a financial than a leal question
and yes I did post it by mistake without being logged in... sorry
Dear Friend,My advice to you in such a scenario would be pretty straight and simple. First of all, mere offer to pay Pound 250 should not be the guiding tool to decide if you are willing to transfer your investments. Deciding whether to transfer ISA from one house to the other is a fairly serious decision and many factors go into it.First of all, you need to see if Hargreaves Lansdown -- HL, offers wide choices for investments and fund managers, its devotion to research, its current and on-going costs, etc., etc...For example, Hargreaves Lansdown (HL) doesn’t charge either set up or annual fees on its Vantage Sipp provided you invest in funds that pay HL trail commission, otherwise you’ll have to pay a 0.5% (& VAT) annual fee capped at £200 (&VAT). Funds typically have no initial charge but HL doesn’t rebate trail commission on its Sipp (unlike its ISA), i.e. it keeps the full 0.5% a year that is typically paid. Regarding failing of HL, please note that a SIPP or for that matter any investment is only as good as the investments you hold within it. It’s impossible to predict what kind of returns to expect as it depends on the investments you hold and markets moving forwards. Very simply, the more risk you take the more you’ll probably stand to make or lose. Low double digit annual growth is not too far-fetched as a long term average for higher risk investments, but equally you could face double digit losses too in a bad climate.Coming to the core of the question, if your current setup, i.e. Alliance Trust is performing nicely, there should be no reason to transfer your ISA, barring the cost factor which needs to be seen. On the other hand, if you anyway have substantial holdings with HL, you are primarily correct that you should not put all your eggs in one basket.So, in my opinion, since your anyway have holdings with HL, there should be no reason that you should shift your ISA from Alliance, IF IT IS PERFORMING.. Costs should not be factored much but with your existing holdings with HL, your risk is properly and evenly spread between two service providers and I would agree with your idea of NOT TO put all the eggs in same basket.You may "Accept" and leave feedback if this helps as this is the only way we get credit for the work. Alternatively, please feel free to revert with additional queries.Warm Regards,
Thanks, XXXXX XXXXX the trouble you have taken, but I am not sure you have answered my real question. It is only about ISA's not SIPP's. Performance is not an issue as the funds are self selected. My primary concern was whether there is absolute security in the monies (i.e. their not being lost through misfeasance rather than market flucutations) and the relative cost of keepinng them under the two umbrellas.
Dear Friend,No... I got your question .. the issue is, as a rule of the thumb, the investments should be adequately spread so as to reduce risk. This goes common with all instruments including ISA or SIPP.No, there is absolutely no risk that you apprehend like. You cannot lose money like this.However, as I said in my earlier reply, since you anyway have substantial holdings at HL I see no logic of shifting your ISA there and better keep your risk spread and remain fundamentally correct.You may "Accept" if this helps or feel free to revert with additional queries ..Warm Regards,
Graduated in law with Emphasis on Finance and have have been working in financial sector for over 8