TEST – Platform Cost Model

Freetrade

Last reviewed: today.

Fees verified via Freetrade's charges page.

Covers all eight asset classes (its thinnest has just three funds, still enough to build every risk-level portfolio), and its fees are comfortably the lowest of the seven platforms tracked at every portfolio size: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £19 a year, and around £157 a year for a portfolio with a total value of £250,000.

InvestEngine

Last reviewed: today.

Fees verified via Invest Engine's charges page.

The only one of the seven tracked platforms with an asset class — Alternatives: Property — down to a single fund, though every asset class is still covered. Fees are among the cheapest tracked at both portfolio sizes: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £20 a year, and around £168 a year for a portfolio with a total value of £250,000.

IG

Last reviewed: today.

Fees verified via IG's charges page.

Covers all eight asset classes in full, and fees are comfortably below average at every portfolio size: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £87 a year, and around £224 a year for a portfolio with a total value of £250,000 — the second-cheapest platform in the group.

Interactive Investor

Last reviewed: today.

Fees verified via Interactive Investor's charges page.

Covers all eight asset classes, though its narrowest (Global Corporate Bonds) has fewer funds than most rivals. Fees run a little high for smaller portfolios: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £137 a year, but its flat-fee structure means a larger portfolio fares relatively better (around £410 a year for a portfolio with a total value of £250,000).

AJ Bell

Last reviewed: today.

Fees verified via AJ Bell's charges page.

Covers all eight asset classesThe eight asset classes I use to construct my low-cost, diversified model portfolios. with real depth (at least nine fundsThese are funds from my Low-Cost Fund list — the diversified, low-cost funds I use to build my model portfolios. even in its thinnest asset class), so it can build every model portfolio at every risk level without compromise. FeesThe fees calculated here include platform fees, trading fees and Ongoing Charges Figure (OCF) fees a year. The assumptions are that (i) eight to 16 trades are conducted for portfolios up to £50k (allowing for rebalancing once or twice a year); (ii) 32 trades are assumed for portfolios larger than £50k (allowing for rebalancing every three months), and (ii) the fund selected for each relevant asset class is the cheapest (i.e., the one with the lowest OCF) available on the respective platform from my Low-Cost Fund list. are middling for smaller portfoliosA portfolio is a collection of investments that can include cash, bonds, shares and alternatives. If the total value of all of those investments is, say, £37,500, then that can be referred to as a £37,500 portfolio.: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £124 a year, but they climb into the pricier half of the group for a larger portfolio (around £627 a year for a portfolio with a total value of £250,000).

Fidelity

Last reviewed: today.

Fees verified via Fidelity's charges page.

Covers all eight asset classes with solid depth throughout (its thinnest still has eight funds), so fund choice is never a constraint. However, fees run above average at every portfolio size: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £179 a year, and around £573 a year for a portfolio with a total value of £250,000 — keeping it out of the cheaper half of the group.

Hargreaves Lansdown

Last reviewed: today.

Fees verified via Hargreaves Lansdown's charges page.

Covers all eight asset classes with strong depth throughout. But it is the most expensive platform tracked at both portfolio sizes: I’ve averaged the cost for a £10,000 portfolio executing eight trades a year and a £50,000 portfolio executing 16 trades a year, giving roughly £183 a year, and around £828 a year for a portfolio with a total value of £250,000 — which is why it scores zero out of five on both fee measures.

Saxo

Last reviewed: more than 12 months ago.

Shambolic Saxo hides a decent offering behind a terrible customer experience.

Saxo names some of the providers on its “sample” pages. But it won’t let you see what the funds are until you set up an account. And to do that, you have to submit sensitive, personal info. That’s a huge black mark against them.

Nevertheless, I submitted my passport, national insurance, bank and other sensitive details, during which I was bounced back and forth between their website and their mobile phone app. Eventually, they confirmed that my application was complete. But it wouldn’t accept my email and password.

I went to the website and found the “contact us” option under technical help. But it requires that I login before it will help — the same thing I needed help with in the first place.

I called them. The line was garbled to the point of being unintelligible. I tried several times over many hours with the same experience every time. I sent them an email asking about setting up an ISA/SIPP and the full list of funds. I never got a response.

On a different day, I tried phoning again and again and, on each occasion, was subjected to a long recorded message about high call volumes. After a few more days’ trying, I got through to a very pleasant lady on the phone who helped me find my login number. I then logged in, which triggered a stream of automatically generated pop-ups, emails and text messages telling me to complete the login procedure and give them my money.

After this prolonged torture, I discovered that they charge a massive 0.40% for custody, a further 0.08% for any funds bought on the London Stock Exchange, and a few cents for each “share” bought on the US exchanges.

It turns out that they do have an excellent range of low-cost funds which you can put into an ISA or a SIPP. But they’re not getting any of my money until they improve their customer service.

Halifax

Last reviewed: more than 12 months ago.

Halifax offers a website that is a pleasure to use (others providers please take note). But platform fees are high for portfolios below £50,000, and the website has a blind spot when it comes to global government bonds.

The most important issue here in my opinion is the lack of low-cost global government bond funds in its offering of around 2,700 funds.

Less important is the fixed annual fee of £112. That’s roughly three-times higher than the lowest platform fee among the platforms that I reviewed. Once a portfolio exceeds £50,000 though, this becomes a small amount.

Finishing with a huge positive for Halifax: its website. This is how websites should be. It’s a pleasure to use. The search box immediately shows the result if it has the fund you enter by ISIN. It has lots of filters on the search facility and you can view 20, 50 or 100 results.

If it fixes the negatives, Halifax’s overall rating could be raised.

Moneyfarm

Last reviewed: more than 12 months ago.

Moneyfarm offers a reasonable range of low-cost, passive funds but doesn’t offer a global equity fund that is cheap enough to be included in my portfolios. Fixing that would go a long way to their being included in my “Recommended” list.

If you avoid their expensive active funds and go to their passive ones, the annual cost, according to their calculations, is 0.62%. This includes a hefty platform fee of 0.45%, i.e., what Moneyfarm takes from you for themselves.

I looked around the website to find what funds I could invest in, but they won’t tell you unless you submit personal information. I won’t let companies that want my money for a product or service push me around like that.

I got onto their chat-helpline and, after a few minutes, the respondent said they’d send me a list of the funds and stocks that you can invest in with them. Sure enough, a few minutes later, the full list was in my inbox. It’s good that they were so responsive and happy to share essential information…it’s not good that you have create an account and then ask for basic information that should be available and easy to find on their website.

Close Brothers

Last reviewed: more than 12 months ago.

The limited selection of low-cost funds and middling platform fees leave Close Brothers with a Mixed from me.

The website funnels you into providing your personal and bank details before it will tell you what funds you can choose from.

I had to phone up and get the location of their rather good investment search facility.

Once you’ve lifted that stone, you can see that Close Brothers has an OK selection of funds. It’s almost enough to construct my low-cost Model Portfolios, albeit with blind spots in bonds and alternatives.

Aviva

Last reviewed: more than 12 months ago.

Reasonable fund selection but a painful user experience.

From what I could see, and I spent A LOT of time trawling through the website, Aviva only includes peer/competitor funds when Aviva itself doesn’t provide a similar product.

Aviva’s products tended toward the expensive.

If you have the patience and tenacity, you can go through the tedious process of getting to the fund selection and searching for the funds you want.

I could not get the website to return any results for ISINs or full fund names. I had to keep abbreviating the name before sifting through the funds.

At the end of this online torture, I found that Aviva does have a half-decent fund selection. But add in the mediocre pricing that gets less competitive the more you invest, why bother?

Vanguard

Last reviewed: more than 12 months ago.

The limited range of funds is not helped by Vanguard apparently hiding some of the ones that I find most attractive.

As the company that invented passive funds in the 1970s, I was expecting Vanguard to do so much better. The late founder, John Bogle, is something of a financial hero for ordinary investors as he accepted lower profits and offered much better value.

Recently, though, the company has ventured into active funds that offer higher profits for them but, well, you know what I think of active funds.

What’s more, I’d heard that Vanguard hides or excludes some of its most attractive low-cost funds. Sure enough, I discovered exactly this.

I prefer funds that reinvest the dividends they earn. These “accumulative” or “acc” funds dominate my low-cost portfolios. Several of Vanguard’s Acc funds were not shown in search results but you could winkle a few out by searching for ISINs directly.

What was even more disappointing was that some of the best low-cost funds were impossible for me to find no matter where I looked. If the folk at Vanguard can correct me on this, then great, but the decent folk at Which? reported the same experience.

And that raises the question as to why Vanguard would not make all of its funds available to its own customers on its own platform.

Vanguard offers a range of 70 funds to choose from (not including the 16 ready-made portfolios, which I don’t like). This range includes some of the active (i.e., expensive and poor returns) funds that Vanguard has started offering lately.

Nevertheless, being Vanguard, there are some attractive low-cost funds available, but not the range available I need to build my low-cost portfolios.

HSBC InvestDirect

Last reviewed: more than 12 months ago.

The impression I got from HSBC’s offering was that it doesn’t want retail investors’ money.

The range of 500 funds appeared to me to be a limited selection of expensive funds.

If my experience is anything to go by, HSBC’s biggest howler is that it appears to exclude many of its cheapest funds, and those of its investment partner, on its own platform for its own customers.

In other words, from what I could tell, HSBC’s customers can only buy expensive funds.

Remember, most of the investments I’m looking at charge an OCF of no more than 0.10%. If someone at HSBC can correct me on my assessment of its website, I’d love to hear from them and put this right.

One last negative; the list of funds doesn’t include ISINs and there’s no search facility that I could find. You have to look at every fund to find the ones you want.

Plenty of room for improvement.

Moneybox

Last reviewed: more than 12 months ago.

Moneybox’s mobile-only offering has an insufficient selection of low-cost funds to allow me to set up a diversified, low-cost portfolio.

Moneybox’s image is one of young people who look as though they’ve just left the student bar. I have no problem with this casual vibe because they outsource pretty much everything financial to bigger companies (a number of which co-own moneybox).

What I don’t like is the 100% focus on the mobile phone app for managing money. As I’ve mentioned with other mobile-only platforms, I want the choice of being able to see everything on a big screen and I don’t want the constant temptation to keep looking at my investments. Investments do far better if I set them up properly and leave them alone except for an annual rebalance to make sure they’re on track.

More positively, Moneybox offers ISA and Self-Invested Personal Pension accounts and the website is upfront about the fees and costs of both using the platform, 0.45% a year, and the fees associated with the individual funds.

However, those fees are less upfront on the mobile app which leads you to more expensive investment offerings by default. If you’re resistant to this herding, you can find a selection of 36 funds to choose from in an ISA. However, only 12 of those funds are available for a pension and, out of the entire 36, only five of them make it onto my list of low-cost funds that enable me to create a diversified portfolio that emulates the average investment decisions of over 150 portfolios run by big investment institutions.

If moneybox were to stop pushing the higher-cost offerings and add low-cost funds covering UK All shares, UK corporate bonds and real estate funds, it would get some of my money.

BestInvest

Last reviewed: more than 12 months ago.

Easy to use but insufficient fund choice.

The BestInvest website is very user-friendly. You can download a PDF of all funds the company offers.

However, almost all the funds are expensive and, therefore, don’t make the cut for my low-cost portfolios.

Virgin Money

Last reviewed: more than 12 months ago.

A simple but restricted offering that’s a bit pricey.

For investments of under £25,000 in total, this might be OK. But the fees quickly become uncompetitive after that, despite a relatively low basic charge for pensions.

They skirt around the trading fees and don’t show net performance, which is fairly common, but goes against their otherwise justified claim of keeping things open and simple.

Finally, their selection of just four portfolios means that you’re relying on their research. I prefer to copy the overall investment decisions of 150 funds rather than relying on the opinion of just one.

Barclays

Last reviewed: more than 12 months ago.

Small range of jaw-droppingly expensive funds.

During 2023, Barclays appeared to adopt a strategy of “charge customers as much as possible, they won’t know any better”, hence the “0” score for fund range – not a single one of the low-cost passive funds that passed my tests is offered by Barclays.

Barclays’ website talks of an “extensive fund range”. The truth, in January 2024, is that Barclaysinvestments.com has a selection of 385 expensive funds that start at 0.65% OCF. That’s 11-times what you need to pay for the equivalent allocations.

It doesn’t stop there. The OCFs rocket to beyond 2.40%. Two-point four percent!!! Any positive returns you were hoping to make will be hammered long before they get to you.

Charles Stanley

Last reviewed: more than 12 months ago.

Very disappointing offering.

The online experience is tiresome, although it’s not as bad as some. What really lets Charles Stanley down for me is the miserly offering of just 22 low-cost passive or ETF funds in their “preferred list” of just 76.

If the company offers more than this, I’d be really keen to hear how to find them as that would make a heck of a difference to my opinion of the company’s offering. Those funds that I could find were predictably expensive.

On the upside, you can view some of the funds without logging in. Back on the downside, I had to search by their restricted topics, I couldn’t search by specific funds.

The ISIN sometimes appears at the top of the fund that you’ve clicked on but not often enough. Usually, I’d have to dig around in various financial documents, such as the Factsheet or Key Investor Information Document, to find the ISIN.

Wealthify

Last reviewed: more than 12 months ago.

Easy to use but you can only invest in their expensive portfolios.

Wealthify is Aviva’s retail-focused website. While it is infinitely easier to use than Aviva’s tortuous platform, it still relies on Aviva’s high prices and restricted choice.

You can create new or transfer from existing SIPPs and ISAs, but you can’t choose low-cost funds to invest in; you can only put money into their existing portfolios.

And at an annual charge of 0.75% or more a year, why on Earth would you?

This is one of many platforms that pays people to send it new clients through its affiliate marketing programme, hence it appears in “recommended” lists of platforms. Don’t be fooled.

Plum

Last reviewed: more than 12 months ago.

Plum’s investment platform is expensive, clunky and secretive.

Plum is another mobile app-focused platform. As I’ve mentioned often enough, I don’t like mobile-only platforms because I want to view my account on a big screen and I don’t want to be tempted to look at or mess with my investments all the time. Investments do better if I leave them alone and just rebalance once a year.

On top of that, Plum’s website sends you in circles; click on the “investments” option and scroll down to and click on “Dive into funds”, and the website takes you to…the exact same page you were already on.

This page tells you that it offers 26 mutual funds, but it won’t tell you which ones. If you want ETFs, which I use a lot in my low-cost portfolios, tough luck. You can only have them if you live in the EU.

Anyhoo, Plum’s offering doesn’t improve when you look at the fees, 0.45% a year before you add the ongoing charges figures for whatever mystery funds they might allow you to invest in. Plum itself suggests 0.22% as an example ongoing charges figure and refers you to the Key Investor Information Documents for specific fees…which it won’t let you find without signing up.

And if, like I did, you try to sign-up on their mobile phone app, they insist on getting your bank details before you’ve seen the funds on offer. Yet another reason to avoid giving them any of your time or money.

Trading212

Last reviewed: more than 12 months ago.

Too few funds and the highest fees of the platforms I reviewed.

The stock selection is too limited for me to be able to build my low-cost portfolios.

I also found it to be the most expensive platform for portfolios up to £50,000.

The website is very easy to use, however, with an effective search facility that returns results almost before you’ve finished typing them.

Chip

Last reviewed: more than 12 months ago.

Chip’s low platform fees aren’t sufficient to offset its extremely limited range of low-cost funds on this mobile-only platform.

To create an account, you have to install the app on your mobile phone. I don’t like this for two reasons. Firstly, I want the bigger screen that a computer provides for viewing all my options and related information. Secondly, I don’t want to be sucked into thinking about my investments all the time, and that danger is more likely with a mobile-only platform. I want to get on with my life while my investments do their thing.

The next drawback with Chip, and it’s a big one, is that it doesn’t offer a Self-Invested Pension Plan or SIPP. For me, this restricts Chip to being a short-term investment facility. That’s no use to me because I’m a long-term investor.

If you do set up an investment account with Chip, you can only choose from 26 funds. Of those, only two make it through my vigorous testing to find low-cost passive funds that allow me to emulate the investment decisions of over 150 funds but for much lower fees. I’ve identified well over 100 such low-cost funds that I can use, so I’m not going to allow myself to be limited by what Chip wants to sell rather than what I want to buy.

Talking of fees, Chip’s platform fees are very low at £65.05 a year or less if your investments total less than £26,000. But this is immaterial, as far as I’m concerned, because I can’t set up my low-cost portfolios and I can’t set up a pension of any kind.

Santander

Last reviewed: more than 12 months ago.

Santander more or less failed across the board of my needs.

It offers a limited range of expensive funds, requires the user to set up an account to see what funds are on offer, and does not offer a SIPP.

It offers “Over 1,000 funds” of which around 820 charge more than the maximum 0.20% OCF I look for on most of the funds included in my low-cost portfolios.

The platform fees are average.

eToro

Last reviewed: more than 12 months ago.

This one is best suited for high-risk trading on things like cryptocurrency.

eToro doesn’t offer a SIPP and it uses Moneyfarm to provide an ISA. With the platform’s focus on USA-based trading and spreadbets, the offering of low-cost funds is terrible. I could only find one fund that passes the test to make into my portfolios. The rest were either expensive, irrelevant or domiciled in the USA and, therefore, unavailable for me to buy directly into.

Pinning this information down took a lot of searching and several messages to their helpline which only started to be useful once I’d set up an account.

I see no point in a sensible, long-term UK investor using eToro.

It gets featured in several “best of” lists and I can only assume that this is because of eToro’s affiliate marketing programme which pays handsomely to anyone sending it a new customer; I’m NOT going to recommend it to you no matter how much they offer me to do so.