Investors are somewhat spoiled for choice these days when it comes to allocating their capital.
Many UK investors are shunning more traditional ‘wealth management’ routes due to the hefty management and performance fees, and general market underperformance.
Statistics inform us that in the UK more and more investors are building their investment portfolios themselves. By adopting this approach, you’ll certainly save on costs, but will you find your holy grail and regularly beat market performance?
Today, we take a deep dive into what most would state are the best platforms in the UK, discuss their differences, and grade them based on what they offer you as the investor.
Hargreaves Lansdown 8/10:
Wide range of products, easy to use, and a strong reputation in the industry. The ‘Wealth Shortlist’ is an interesting feature, as it lists funds chosen by their in-house analysts. However, a caveat would be that some of these have been underperforming over recent years.
Find HL here- www.hl.co.uk/investment-services
Fidelity 6/10:
Similar to HL, Fidelity offers an easy to use platform and a wide range of products. It doesn’t have as many features as HL, and their ‘advice’ team seem targeted to turn ‘self investors’ into ‘advised investors’. Perhaps they would rank higher without this approach.
Find Fidelity here: www.fidelity.co.uk/services/online
eToro 5.5/10:
Low cost, easy to access the markets- tick. Their platform even allows you to follow their traders. However, if you are looking for a platform that can assist you to beat markets, the statistics from eToro’s own website might put you off. Over 75% of their clients lose money. They’ve made trading easy, but not profitable. Possibly aimed at smaller investors looking to ‘win big’, which tends to backfire.
Find eToro here: www.etoro.com
Vanguard 7.5/10:
ISA accounts, pension accounts and a wide variety of products. Vanguard ticks many boxes. It also has an option to select ‘a ready made portfolio of funds’. A solid option for your portfolio.
Find Vanguard here: www.vanguardinvestor.co.uk
The Portfolio Platform 9/10:
Something a little different. Clients use TPP’s platform to link good quality traders to their own portfolios, replicating their returns. The strategies range in risk and reward, but they all seem to outperform the markets, due to only showcasing traders with a track record of outperforming the markets by at least 2 X per annum. They offer a fresh option to those who want more. There are no management or performance fees, or any fees to invest or withdraw capital. It does appear to be a potential game changer.
Find TPP here: www.theportfolioplatform.com
AJ Bell 7.5/10:
Top rated research team, wide variety of products, and a solid support team. Very similar to Vanguard and HL in a busy space but also very popular with the UK investment market. A solid choice in our opinion, but not offering anything different.
Find AJ Bell here: www.ajbell.co.uk
St Jame’s Place 5.5/10:
Disappointing. Very popular with the U.K. investment market but many of their clients have found their way here by default. Their extortionate fee’s (entry, exit and management), and underperformance have received very bad press recently, although they claim to be working on these. We wish them well for the future, but they lose marks for excessive charging and general underperformance.
Find SJP here: www.sjp.co.uk
IG Index 7/10:
An innovative platform that provides exposure to a wide variety of derivative based investments. Some good research and trading tools, but perhaps suited to a ‘day trader’ rather than a ‘long term investor’.
Find IG here- www.ig.com/uk
Summary:
We have tried our best to provide an overview on the more established ‘wealth management’ platforms, alongside the more aggressive fintech challenger brands, who seem intent on stealing market share.
They all have some excellent features, and perhaps some weaknesses, but in the end- it boiled down to 2 propositions in our opinion.
Hargreaves Lansdown are one of the most established in the UK, who have over 130 billion GBP’s under management, and if you are looking for an easy to use investment platform, with a wide range of products and features- HL should suit your requirements.
Most impressive of all was The Portfolio Platform.
They set out to offer something different and launched a platform that arrived in the market to a large fanfare, and some big promises to change how the UK invests.
This is very likely to take off and steal market share given that the market has evolved into more of a self managed environment from a more ‘hands on’ generation.
By only working with traders who have track records of outperforming the markets over a number of years, whilst charging zero performance and management fees- it’s a platform that offers something very different, it’s refreshing, and given time- may well change how the UK invests.
