Thank you for taking the time to visit our website. Here you’ll be able to find out a bit more detail about the facts and figures quoted in the article. We’d like to extend a big thank you to the Sunday Times for using our research.

FIRSTLY, AN IMPORTANT NOTE ABOUT THE CALCULATIONS

Comparing the cost of investing on platforms can be tricky, which is why we put our tables together. There are lots of platforms to choose from, each with their own unique charging structure.

Some obvious points before we start: firstly, some platforms charge a fixed, rather than a percentage fee. This is good for those with a larger lump sum to invest, but can be expensive if you are starting out or have little to set aside.

Secondly, platforms charge a fixed fee each time you buy and sell shares. However, some will also offer a reduced rate if you commit to investing a regular monthly amount (often known as a regular investing plan).

Lastly, cost is only one aspect of choosing a platform. Other factors to consider are how much help you require choosing your investments; how much value you put on investing with a big brand platform and how easy the company’s website is to use.

INVESTMENT IN FUNDS

The table below looks at a £50,000 investment into a pension, where a customer invests only in funds. It highlights the total cost of using the platform over one year.

The calculations include the platform fees, any additional charges for a pension or Isa, and trading charges where applicable.

The first example assumes no trading, the second assumes a customer making six transactions (buys or sells) in the year.

*New structure with effect from 11th December

Monthly fund investment in an ISA

This table assumes a monthly investment in a fund, held within an Isa. One set of calculations assumes no trading, whereas the second assumes the customer makes six transactions (either buys or sells) throughout the year.

For simplicity, when calculating percentage charges, we take the mid-point of one year of investing. For example, for £100 a month, we use £600, and for £1000 a month, we use £6,000.

*New structure with effect from 11th December

INVESTMENT IN EQUITIES

The two tables below use the same assumptions as above, except they assess the cost for investing in equities rather than funds. 

By equities we mean investment in shares, investment companies and exchange traded funds.

Pension – Investment in equities

*New structure with effect from 11th December

Monthly equity investment in an ISA

A FOCUS ON INVESTMENT COMPANIES

The lang cat recently undertook a large research project looking at the cost of using Investment Companies on different platforms. The research was carried out on behalf of the Association of Investment Companies. Click here to have a look at this research

WHAT IS AN INVESTMENT COMPANY?

They are a type of fund where investors pool their money to invest in a portfolio of assets, such as shares bonds and cash. A professional fund manager decides what to buy or sell – much like a managed fund.  However, they are listed companies and can be traded like any other share, like Vodafone or National Grid.

As listed companies, they have independent boards of directors to look after shareholders’ interests.

STILL WANT MORE?

If you’d like to hear more of our views on the platform market, then you’re more than welcome to download our annual guide. You can download it here. It’s free!