Vantage Service FAQs
Here we seek to address some frequently asked questions on the Vantage Service.
If you're unable to find what you're looking for, please do not hesitate to contact us.
- How does the initial saving you offer on funds work?
- Funds are traded using a forward pricing system, what does this mean?
The vast majority of funds price daily (on working days), mostly at midday. The forward pricing system means that when you place a deal it will be traded at the next available valuation point, typically at midday on the next working day. This means that you will not know the exact price that you will buy or sell at when you place the deal.
- What is the difference between income and accumulation units?
- What is the difference between 'inclusive' and 'unbundled' funds?
In the past most investors who held funds, such as unit trusts and OEICs, paid a single ongoing charge to the manager of their chosen funds. This charge often included an element of commission which the fund manager shared with brokers, such as Hargreaves Lansdown, to help pay for their service. We call these funds 'inclusive' funds.
- Can I transfer existing investments with other providers to the Vantage Service?
- How long will a transfer to a Stocks & Shares ISA or Fund & Share Account take?
- What happens to any income (dividends) from my investments within the Vantage Service?
Many funds offer you the choice between income and accumulation units. If you choose income units the income you receive will be treated as per the income instructions for your Stocks & Shares ISA, SIPP or Fund & Share Account.
The Stocks & Shares ISA and Fund & Share Account can be set up to treat income in one of three ways. The Vantage SIPP and Junior ISA can be set up for reinvestment or deposit only:
- Held on account - Income will be held on your account pending your further investment instructions.
- Pay out to your nominated bank account - Income will be paid out directly to a nominated bank/building society account. This payment will be made within 10 working days of the beginning of each month.
Reinvestment - Income will be held within your account and accumulated until it reaches or exceeds £10 per holding, when it will be automatically reinvested, or you can choose your own reinvestment level between £10 and £1,000. Reinvestments are made between the 11th and 21st of each month (or as soon as practicable thereafter). A dealing commission of 1% (£1 minimum, £10 maximum) will apply.
- How will loyalty bonuses be paid to me and what can I do with them?
The way in which you receive loyalty bonuses will depend on when you bought the units in your fund.
Loyalty bonuses paid on fund units bought before 1 April 2014 will be paid as cash. You have the option to withdraw (in the Fund & Share Account and ISA, but not the SIPP), reinvest or hold them on your account where they could be used to cover fees or fund a future investment.
New rules introduced by our regulator, the Financial Conduct Authority, mean that all loyalty bonuses earned on fund units purchased after 1 April 2014 must be reinvested back into further units. We cannot pay this money out to you and it cannot be used to cover fees.
You have three options for loyalty bonuses paid on fund units bought after 1 April 2014:
- Automatically reinvest into your largest holding, subject to a minimum investment of £10.
- Automatically reinvest into one of your existing fund holdings, subject to a minimum investment of £10.
- Hold the loyalty bonus on your account and reinvest into a fund of your choice, subject to a minimum investment of £10.
When do you collect fees and charges?
How do I pay my fees and charges?
We collect fees and charges from available cash on your account. If there is no available cash within your account, we will try to collect fees from cash you hold in your Fund & Share Account.
Our system will look to collect fees in this order:
- Loyalty bonuses received on units purchased before 1 April 2014. If no loyalty bonuses then;
- Cash in the account in which the fees were generated. If no cash on the account then;
- Cash in your Fund & Share Account. If no cash in your Fund & Share Account then;
- Sell holdings to cover fees from the account in which the fees were generated.
- How can I pay fees from outside my ISA/SIPP?
If you choose not to hold cash within your account or do not wish to use cash from within a tax wrapper (ISA/SIPP) to pay fees, you can choose to have all fees collected from the Fund & Share Account.
To choose this option:
- Go to the 'Account Settings' section of your account;
- Select the ‘Fee and Minimum Cash Balance’ tab;
- Click on 'Fee collection options';
- Follow the onscreen instructions to edit your fee collection method.
- How will you collect fees and charges if there is insufficient cash on my account?
- Will you tell me before you sell my holdings?
- What is the Suggested Minimum Cash Balance?
The Suggested Minimum Cash Balance is designed to give you an idea of the amount of cash you should hold to meet the next few months’ fees, and other outgoings. However, it is just a suggestion and you can ignore it (or amend it) if you wish.
- Where can I see the fees or charges that have been applied to my account?
- What are the charges for investing in funds?
Funds often levy an initial fee when you invest, up to 5.5%, and an ongoing charge, typically around 1%. Many brokers, including Hargreaves Lansdown, have negotiated savings on the initial charges for their clients.
Our charge is tiered within bands and will be 0.45% per annum on the first £250,000 of funds within each Vantage account, 0.25% per annum on the value of funds between £250,000 and £1m, 0.1% per annum on the value of funds between £1m and £2m, and no charge on the value of funds over £2m.
The charge is based on the total value of funds (such as unit trusts and OEICs - not investment trusts or ETFs) held in each Vantage account. Please note these charges apply to each account separately.
Fund fees are calculated based on the values of holdings on the last day of the month.
- What are the charges for investing in shares?
The paper supplement
- Why do you have a separate charge for printed reports etc.?
Our charging structure aims to be competitive, simple and to be fair, to reflect the work done.
Our Vantage Service charge aims to cover the services that people use day to day and then apply separate fees for certain services that not everyone uses. Otherwise, some people end up paying for services they never use. A separate fee for those clients who want to receive paper statements is fairer to all of our clients because only those clients who use the paper service are charged for it.
- I want to receive my contract notes in the post but am not concerned about 6 monthly investment reports. Can I opt out of the investment reports and therefore avoid the paper supplement?
No. The only way to avoid the paper supplement is to select the paperless option and receive all reports and contract notes online.
The charge for sending paper statements and valuations in the post recognises the costs of production, postage and processing applying to all aspects of administering paper accounts, and includes contract notes, corporate actions and share offer confirmations.
- How do I sign up for the paperless service?
We believe our paperless service offers clients who are comfortable using our online service significant advantages over our postal service. Contract notes, income schedules, corporate action notifications and six-monthly investment reports are available to view (and print if you wish) from our website and we send you an email as soon as they are ready. There is no need to wait for the post.
Your important documents are stored safely and securely within your online account. They can be found quickly whenever you need them, there is no danger of personal documents going astray in the post and no need to shred confidential papers when you receive them.
To sign up for the paperless service simply:
- Log in to your account
- Click the 'Account Settings' link
- Select the 'Personal details and statement delivery' option on the left hand side of the screen
- In the 'Investment report and contract notes' box, click 'Edit delivery preference', update to 'Paperless' and click 'Save'.
- How are the cost figures for my investments calculated?
The cost figures shown for investments held within the Vantage Service are based on the total number of units/shares held, multiplied by the average cost price (including dealing charges and stamp duty) of all purchases in the stock. The average cost price is calculated by reference to purchases only; it makes no reference to sales.
- Investor buys 5,000 shares for £1 each at a cost of £5,000
- Average cost price: total purchase costs (£5,000) divided by total number of shares purchased (5,000) = £1 per share
- Share price rises and investor buys another 2,500 shares for £3 each at a cost of £7,500
- Average cost price: total purchase costs (£5,000 + £7,500) divided by total number of shares purchased (5,000 + 2,500) = £1.67 per share
- Share price rises further and investor sells 3,750 shares (half of their holding) for £4 each raising £15,000
- Average cost price remains unchanged
- Share price continues to rise and investor buys 2,000 shares for £10,000
- Average cost price: total purchase costs (£5,000 + £7,500 + £10,000) divided by total number of shares purchased (5,000 + 2,500 + 2,000) = £2.37 per share
- Cost of holding: total number of shares held (5,750) multiplied by average cost price (£2.37) = £13,627.50
The gain/loss figure shown on your investment report is the difference between the cost of your shares or units (calculated in line with the above method) and their market value on the valuation date of your report (31 October or 30 April).