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How to buy investment funds

How to buy investment funds

Investors still hoping to take advantage of this year’s individual savings account (ISA) allowance may be asking how to buy funds.

They’ll soon discover that they are spoilt for choice online both in terms of the number of websites and the different kinds of deals and services they offer.

This article is not a comprehensive survey of these websites. However, to give you an idea of how the system works we’ve taken a look in more detail at how to buy funds from three of them.

General rules

Firstly, investors should avoid buying directly from fund managers as they will usually add a 5% ‘initial charge’ which these websites don't do and which is why we’ve looked at brokers here.

Another general rule when it comes to buying funds is that the lower the costs an investor pays, the more minimal the services on offer. This was confirmed by the selection of brokers we looked at: Hargreaves Lansdown, Bestinvest and Clubfinance. But we would recommend that investors look at as many as possible before making a decision.

What's the cheapest way to buy funds? | Moneywise

28 Jul 2014 ... Platforms offer the cheapest way to buy funds, but they aren't free. ... Just which
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outline the charges for the UK's biggest and most popular platforms.

Open an account and buy

The first thing an investor needs to do is open an account and for this all that is required is a computer, a debit card with cleared funds and a national insurance number.

How to buy investment funds - Citywire Money

31 Mar 2011 ... ... savings account (ISA) allowance may be asking how to buy funds. ... being in
the UK who can be of help and understands their products.

How to buy from Hargreaves Lansdown: Before buying an investor will need to open an account which can be done via the homepage where there is a link to an online application form. Once the account is up and running you can follow links to ‘fund research and discounts’ where you will find the fees and a search tool to look for funds. Use this to find the factsheets of the funds you want to buy where there is an 'invest now' button. Citywire's Dumb Investor provides more detail.

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Costs: Hargreaves Lansdown usually waives initial charges which would be as much as 5% but check what the actual deal is as it varies between different investment groups. The annual management charge (usually 1.5%) remains in place but Hargreaves Lansdown gives back 0.25% to its investors as a 'loyalty bonus' cutting the cost to around 1.25% per year.

Services: Hargreaves is a popular choice and has one of the widest ranges of funds available with well over 2,000 to choose from. Hargreaves has services for its investors like an ‘X-ray’ tool that allows investors to see how the fund's assets are allocated to different assets like shares, bonds and commodities.

Investment Funds - Global Investment Centre | HSBC Bank UK

Home - HSBC Bank UK .... For more details, including how you can amend your
preferences, please read ... Research, buy, and track investment funds online.

How to buy from Bestinvest: The Bestinvest homepage has ‘buy ISAs’ and ‘buy funds’ tabs. The site also asks whether investors want advice or want to make their own decisions. Investors who decide to go it alone still have access to Bestinvest research and top fund picks. Whether you've picked your own fund or one recommended by Bestinvest the relevant factsheet will include a 'buy as ISA' or ‘buy as unit trust’ tab. Or you can  use the 'add to basket' option which will also take you through to the online application form.

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Costs: Bestinvest customers pay the full 1.5% annual management charge. However, Citywire found some of the deals that Bestinvest has struck with fund managers were better than those offered by other brokers, including Hargreaves.

HSBC Investments Centre - Funds | HSBC Bank UK - Investing

For more details, including how you can amend your preferences, please read ...
Aberdeen Asia Pacific I Fund Income ... Aberdeen, Accumulation, Europe
Excluding Uk, Find out more .... What happens after I have placed a buy

Rob Mackinlay (Citywire)

How to buy funds at a 20pc discount - Telegraph

17 Aug 2013 ... We explain how how to make the best investment choices. ... How to buy funds at
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since 2009, names his best and worst investments.

Apr 01, 2011 at 09:49

How to buy index trackers - Monevator

24 Jun 2014 ... A beginner's guide on how to buy index trackers. ... FTSE Developed Europe ex
UK Equity Index Pension Fund”, they have this marked as FMC ...

Grumpy Old Man 2, I checked back with BestInvest on your question, here's the reply. It seemed to cover the issues, let me know if it doesn't:

Bestinvest: "Existing clients with Bestinvest who are invested with Fundsnetwork can login to our client centre and invest via Fundsnetwork. They can also login on to Fundsnetwork and still get Bestinvest terms. If you are new to Bestinvest then the only online option is via Cofunds.

"The result is still the same whichever platform you use if you go via Bestinvest – marketing leading discounts, independent advice and research."

Hope that helps. Citywire will be doing something soon on how to buy shares, ETFs and investment trusts. An investor buying funds now should take a serious look at the options their broker provides on the shares front (this includes investment trusts and exchange traded funds). So another area of interest is how painful is it to change brokers if you want to move? If anyone has any views on that please let us know.

How to invest in funds | unit trusts, oeics and investment trusts | This ...

13 Jan 2010 ... Find out what funds and investment trusts are and how to invest. ... By Simon
Lambert for .... Investors can buy or sell these units to join or
leave the fund, but new money outside this pool cannot be raised ...

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Theophanis Pantzaris

Apr 03, 2011 at 16:59

I am surprised no one has mentioned Cavendish online.

They refund all the initial commission about 3% and all their annual tail commission, about 0.5%. All they charge is a one off 25 pounds registration fee which covers you for life.

You have to use the Cofunds or Funds Network application forms on their site. No after sales service is given, but their office staff is very helpful for general info. You can access your account with current valuations on the supermarket website any time and you also get an annual statement by post. You can buy more, or sell or switch funds in a jiffy.

Fantastic value. An income UT yielding, say, 4.5% as normally bought, yields 4.5x 1.03 + 0.5 = 5.14% from Cavendish. What other service do we really need?

Hargreaves Lansdown | ISAs, pensions, funds and shares

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Apr 04, 2011 at 15:31

I use HL for my investments but feel their charges for ITs are too high, and I have told them this. See reply they gave me today, so there may be some hope. Could be they intend to re-balance charges rather than reduce them so overall maybe no better off.

'As announced in our interim results, Hargreaves Lansdown are currently undergoing a review of our stockbroking services, including the dealing commission we charge and the annual management charge for holding shares, investment trusts, ETFs and corporate bonds within the Stocks & Shares ISA. We will be announcing full details about any changes to our stockbroking service to our clients once this review has been completed. We anticipate this to be in the summer.'

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