Analysts at Numis have compared charges from the likes of Barclays, Brewin, Coutts and Rathbones to investigate how industry fees stack up against platforms' newly-unveiled clean prices.
While price is far from the only consideration taken into account by investors, the unbundling of platform charges has focused attention on fee models at the start of 2014.
Numis' research shows, unsurprisingly, there is still a significant difference between execution-only platform prices and advisory/discretionary managers.
With platform charges typically coming out at around 1.1% in the analysts' base case of a £120,000 investment spread across three accounts, this difference works out as less than half the price of an advisory/discretionary service.
The analysts argue that makes sense, given platforms provide "about half the service" of a wealth manager.
Though any comparison is necessarily based on a large number of variables. there remain several notable differences between providers within the advisory or discretionary space.
These are particularly pronounced when different time horizons are taken into account: Barclays and Coutts are two of the firms which operate a tiered pricing model dependent on length of investment period.
Elsewhere, the bundled St James's Place business model looks expensive on an initial consideration, but becomes broadly comparable (for periods of over one year) once product provider costs are factored in to others' fee models.
The table is based on £120,000 invested across a variety of holdings in three separate accounts: £5,000 in a general investment account, £40,000 in an ISA and £75,000 in a pension.
The costs assume an average of ten trades per year in each of the three accounts' funds, trusts, ETFs and share holdings (see footnotes for further detail).
£ to company (on £120,000)
% to company
Total £ (on £120,000)
|Barclays Wealth (1yr holding period)||5,880||4.9||7,860||6.55|
|Barclays Wealth (3yr)||2,680||2.23||4,660||3.88|
|Barclays Wealth (6yr)||1,880||1.57||3,860||3.22|
|Barclays Wealth (20yr)||1,320||1.10||3,300||2.75|
|Brewin Dolphin Discretionary (fee only model)||1,872||1.56||2,597||2.16|
|Hargreaves Portfolio Mgmt||1,450||1.21||2,090||1.74|
|Investec Portfolio Mgmt||2,850||2.38||3,575||2.98|
|St. James's Place Advisory (1yr)||8,970||7.48||8,970||7.48|
|St. James's Place Advisory (3yr)||3,720||3.10||3,720||3.10|
|St. James's Place Advisory (6yr)||2,595||2.16||2,595||2.16|
|St. James's Place Advisory (20yr)||2,333||1.94||2,333||1.94|
General investment account amount: £5k (£5k in funds, ten trades a year).
ISA amount: £40k (£30k in funds, £10k in shares/ITs/ETFs. Eight fund and two share trades a year).
Pension amount: £75k (£50k in funds, £25k in shares/ITs/ETfs. Seven fund and three share trades a year).
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