Evaluating a Stocks ISA Midcrisislife

#1
Hi,



I've been paying into a Virgin S&S FTSE Tracker ISA for years now and recently I'm starting to wonder if it's time to move. There are three factors I know of:The unit price is 28% up in 5 Years, that sounds ok.
The fee is 1% per year. Hargreaves and Lansdown quoted 0.45% but when I dug into the small print there was a second fee taking it over 1%.
Dividend Reinvested twice a year - last couple of years I've been getting about 1.5% average return twice a year.


I've read a bit about Vanguard only to be shot down by numbers like 100k min entry.



Does anyone know of a way to benchmark S&S ISAs so we can switch as easy as the Gas and Electric?



Cheers, MCL

#2
Most S&S ISAs are self-select, with thousands of funds on offer. It's the funds that make the return.

Charges are in two parts - the platform fee (0.45% in the case of HL; £25 inital, £5 a transaction, and 0% a year in the case of IWEB), which is charged explicitly; and the fund manager's fee, which is calculated and taken from the fund daily.



Vanguard's minimum entry fee only applies if you buy direct, which isn't ISAble. You can buy much smaller amounts as part of an ISA with most platforms.



Switching S&S ISAs is as easy as switching Gas and Electric. It's choosing what to invest in within the ISA that's the hard part, but there's lots of discussion here, and at Monevator, and other financial blogs, and sites like Trustnet and Morningstar have lots of data about investment funds.

#3
I'll chip away at it but the initial question still bothers me. How can you evaluate an index fund? The unit price can end up where you started 10 years back with peaks and troughs in between.



Fees are another can of worms as there are two arguments:



You pay for what you get and should go for quality where you want better scores.

Anything over 1% and you are trimming a slice of your retirement pot away.



So please all readers, feel free to chime in with any gems whilst I take my metal detector to the 'beach' that is ISA!!

#4



I'll chip away at it but the initial question still bothers me. How can you evaluate an index fund? The unit price can end up where you started 10 years back with peaks and troughs in between.
Originally posted by Midcrisislife


You can compare the fund to the index, other funds tracking the index and other indexes.

You do need to look at charges. Virgin is very expensive compared to other trackers which cost as little as 0.06%. Even with the 0.45% fee on top HL is almost cheaper with this fund than Virgin.

#5
You are confusing things.

Please read some good quality books / websites.






I'll chip away at it but the initial question still bothers me. How can you evaluate an index fund?
Originally posted by Midcrisislife


Some possible evaluation criteria:

Does it invest in asset classes / sectors / geographies / timescales that you want?

What the fees are?

Management style?








The unit price can end up where you started 10 years back with peaks and troughs in between.
Originally posted by Midcrisislife


Yes. And your point is?

This is how investments work. You can have ups and downs.






Fees are another can of worms as there are two arguments:



You pay for what you get and should go for quality where you want better scores.
Originally posted by Midcrisislife


And I can sell you a nice ripe strawberry for 10 million pounds but it doesnt mean you are getting quality just because you paid so much money.






So please all readers, feel free to chime in with any gems whilst I take my metal detector to the 'beach' that is ISA!!
Originally posted by Midcrisislife


An ISA is just a wrapper.

That's all it does. Wraps the contents and protects it from HMRC from income tax and capital gains tax.

That's all it does.



Providers provide you with the ability to have an account with them that is an ISA. They charge different amounts of money for this service.



What you put inside the ISA is the thing that gives you the investment return.



(do we have an S&S ISA FAQ? some of these explanations are sounding sometimes repetative and we need to be able to point confused forum members to a decent FAQ.)



I don't know what gems you are looking for.

You can search for SnowMan's spreadsheet to compare some platform fees: http://forums.moneysavingexpert.com/showthread.php?t=5583030

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