Twitter icon Email alerts icon Latest News RSS icon Magazine icon Stay connected:

View the article online at http://citywire.co.uk/wealth-manager/article/a729589

Fidelity undercuts Hargreaves with 0.35% platform charge

by Robert St George, Danielle Levy on Jan 22, 2014 at 11:15

Fidelity undercuts Hargreaves with 0.35% platform charge

Fidelity has secured prices as low as 0.2% for active funds on its platform, as part of its RDR pricing structure which undercuts Hargreaves Lansdown's.

Fidelity, with £48 billion of assets under administration on its platform, has secured an average annual management charge (AMC) of 0.64% for funds on its Select List of approximately 140 products. This spans 35 sectors, with two to five funds in each category.

Fidelity will offer tracker funds from 0.09%, bond and gilt funds from 0.15%, actively managed funds from 0.2%, and multi-asset funds - such as its Pathfinder range - from 0.35%. The firm also confirmed that there would be no charge for holding investment trusts, while Fidelity's own five closed-ended funds would not incur any service charge at all.

Hargreaves Lansdown, which revealed its RDR charging structure last week, has an average AMC of 0.65% for its Wealth 150 list, and 0.54% for its Wealth 150 plus range of 27 funds. The firm's head of research Mark Dampier said he had rejected pricing offers as low as 0.2% Hargreaves Lansdown for the new Wealth 150 plus list.

The news comes as Fidelity reveals lower headline charges for clients who use its platform. Investors with up to £250,000 will pay a 0.35% service fee, falling to 0.2% between £250,000 and £1 million, with no service fees thereafter. Fidelity said there would be no initial charges, switching charges or exit fees. The firm added there would be no extra fees for product wrappers or for having a preference for using the phone or receiving paper valuations.

It contrasts with Hargreaves' structure which starts at 0.45% for the first £250,000 invested, drops to 0.25%  £1 million, going down to 0.1% up to £2 million, with no charge thereafter.

Mark Till (pictured), head of personal investing, commented: 'We are extremely excited to be announcing our new pricing which offers a much simpler way to invest, providing access to the high quality products and services we provide to our customers at exceptionally good value. 

'An investor who invests £10,000 in an ISA, choosing funds from the Select List, will now pay on average £99 a year, with no additional charges whether they want to phone us, receive a paper statement or switch their funds every day. This represents a significant saving for our investors, who would have paid £175 previously.'

3 comments so far. Why not have your say?

HR Man

Jan 22, 2014 at 13:32

For funds, Fidelity's charging structure looks very attractive but not if you hold few shares as they don't mention in their blurb that they charge an 'admin fee' of £5.10 a month for holding shares with them. So my single holding of Royal Mail would cost £61 with them compared to £7 if I keep it with HL....!

report this

ScepticEclectic

Jan 22, 2014 at 15:09

A 0.35% platform fee is a whopping 40% increase over the current 0.25% platform fee. Far from being a 'discount price, this is a massive price hike that will boost FundsNetwork revenues enormously.

Dissemblance vs transparency - where does your platform stand?

report this

r rodney

Jan 22, 2014 at 18:48

Blimey its quiet so far..... just remembering the recent furore from the HL announcements. Where are all the sceptics and keyboard warriors to complain about Fidelity's costs.

It would have helped us if Dannielle could have put a link to their new pricing. Its looking very much a Fidelity / HL battle for clients next year.

report this

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

Sponsored Video: Bringing it all back home


As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.

Today's top headlines

Sponsored Video: Barings on investing in Frontier Markets


From Nigeria to Pakistan and from Kenya to Kuwait, frontier markets are catching investors' attention as never before.

More about this:

Look up the funds

  • Invesco Perpetual Tactical Bond Acc
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Artemis Strategic Assets Inst Acc
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Marlborough Multi Cap Income Acc
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Legal & General UK 100 Index E Acc
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them

Look up the shares

  • Hargreaves Lansdown PLC (HRGV.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them

More from us

More

Archive

On the road

Click here to find out more from the Audience Development team.

Sorry, this link is not
quite ready yet