H-L introduces a Tracker Platform Charge

A question about : H-L introduces a Tracker Platform Charge

It appears that Hargreaves Lansdown are to start charging a platform fee of Ј2 per month per HSBC Index fund from 31 Dec 11. We have all been expecting some sort of charge since these funds became more popular but I think Ј24 per year per fund is very steep so I'll be off to pastures new!

Best answers:

• Let the exodus begin! I had my forms filled in for a HL SIPP, and the cheque was to go off on Monday.
  Time to start again, from scratch, so if anyone knows a SIPP that can hold HCBC and/or L&G and/or Blackrock trackers and that doesn't charge silly fees, please let me know.
  I don't kind paying something, but Ј24 per tracker is a "no go" if you want to hold eight or so of them.
• It would appear that H-L have decided that, by hook or by crook, each customer will in one way or another pay close to Ј200 per year for being on their platform.
  Their 0.5% additional charge is capped at Ј200 per year; a selection of HSBC trackers could be between Ј150 - Ј200 per year; 0.5% retained trail commission on commission-paying funds would be about Ј200 on a Ј40,000 pot.
• I am surprised they have announced this charging structure, yet nothing about post RDR. Still waiting..!
• Yes, that charge is now shown in the factsheets for the funds.
  That's a great shame because those funds were a substantial part of why it was easy to say that the HL offering was cheaper than many others. At 2.4% a year added charge for a Ј1,000 holding plus the effect of compounding that'll no longer be true.
• They haven't announced it as far as I am aware! It has just suddenly appeared on the fund factsheets within the past 24 hours or so.
• It's not just tracker funds. I just checked my funds and there will be a Ј2/month platform fee on The M&G Index Linked Bond fund from 31/12/11. However, in this case it replaces the current 0.5% fund managers annual charge.
• So just what creates the breakpoint between a platform fee - or not? I've just swept through my (33) Funds. The Platform Fee now shows on all the factsheets - but as Free.
• Hugely disappointing news
  We can expect to get notification soon as they have to give 30 days notice (don't think just sneaking it into the factsheets counts as notice in my view). This is what their terms and conditions say
  Quote:
• May be a silly question but would it be possible to invest in the HSBC tracker funds via the HSBC Global investment Centre to avoid the Hargreaves Letusdown platform charges?
  Looks like charges for the FTSE all share tracker and FTSE 250 tracker for example are the usual 0.27% TER only. Minimum investment Ј500 per fund.
  You have to have a HSBC current account or qualifying savings account to join the HSBC Global Investor Centre but presumably that could be easily arranged. Could you open a Flexible Saver for example without opening a current account?
  Only had a quick look so very likely to have missed something.
  Any thoughts?
• HL cant lose by making this change.
  If someone being charged leaves them, then it is loss making account they are better off not having. If they stay then they get money they didnt get before.
  Most trackers will be available direct from the fund house. However, you are likely only to get the retail version of the tracker. Platforms often have the institutional version (read cheaper)
• I have just noticed the fees today and am a bit annoyed, just started my first ISA in August with HL, and most of my funds are in HSBC trackers!
  I have been looking at switching to Alliance Trust today, they have a Ј25 yearly fee but this includes two free trades (worth Ј25). Furthermore the Vantage tracker funds are available with them, with TERs as low as 0.15%.
  Does anybody have any experience with Alliance Trust and/or with the Vantage tracker funds? are there any hidden charges?
  
• The robbing !!!!!!!s. Pretty livid right now.
• The dealing charges are the issue with Alliance Trust. The Ј2 a month charge from HL is probably going to be cheaper than AT dealing charges.