Category: Updates

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Updates

Saxo Modern Wealth Management cuts fees

Slight delay on updating this due to other commitments, but Saxo announced new fees for its UK Modern Wealth Management service, all of which seem to be in the client’s favour. The main changes are:

  • The waiver of commission on currency conversion for international trades has been made permanent. Any FX mark-up near 0% is rare, so this makes it extremely competitive, with the only downside being that the MWM platform only has a limited range of international markets (the new rates do not apply to Saxo Trader). In particular, it’s good for anyone who wants to hold overseas stocks in an ISA, since Saxo’s new rates make it one of the cheapest ISAs for foreign stocks around.
  • The annual fee of £35 has been removed for regular investment accounts and only applies to ISAs.
  • The fund supermarket has become more competitive – it’s now on an RDR compliant basis and will now return all trail and platform commission to investors. Saxo will charge an annual custody fee of 0.5% on fund holdings, although this is being waived until January 2014. It’s hard to know how competitive 0.5% will look in a year’s time, since most of the supermarkets have not yet announced their post-RDR pricing, but I’d guess it will be mid-tier – other firms such as Cavendish will probably be cheaper. Still, Saxo is for now a much more serious contender as a fund supermarket than it was, so I’ve added it to the fund supermarket table for the time being.

Overally, good to see a firm lowering costs and a contrast to TD Direct Investing’s changes the other day.

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Updates on Saxo Modern Wealth Management

Since the Saxo Modern Wealth Management platform for UK long-term investors is rather different to the Saxo Bank platform, it now has its own entry in the broker directory. There are also a few updates to the details of the service from the summary when it first launched in April 2012.

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Updates

New UK discount broker and Prague trading from Saxo Bank

There have been a couple of updates to broker details on the site. In the UK discount stock brokers table, I have added a new service from Clubfinance, previously known as a fund supermarket and the cheapest way for self-directed investors to access the Skandia platform.

This is quite an unconventional service in terms of fees. It charges an account fee of 0.35% per year, with a minimum of £25 per quarter, but online trades in UK shares are priced at just £0.5/trade. Quite a few UK brokers are likely to adjust their fee structure in the run-up to RDR and the platform review, so we can expect to see some others experimenting with unusual arrangements like this.

In the international dealing area, Saxo Bank has added the Prague Stock Exchange for cash equity trading. It’s always encouraging to see a major broker adding another awkward-to-access market, but in practice the significance of this one is limited – there are just  15 stocks listed on the Prague exchange and many of them are cross-listed in Vienna.

The Czech Republic also has an over-the-counter market, RM-SYSTEM Czech Stock Exchange, but that isn’t part of Saxo’s new service. Foreign investors interested in that could look to Fio Banka, which owns RM-SYSTEM and offers an online trading service.

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Updates

Updates to UK stock brokers

There haven’t been many recent updates to the site due to a combination of other commitments and few major changes that I’m aware of among international stock brokers. However, we have seen a couple of UK stock brokers change their fees and this is likely to become more common in the run-up to the Retail Distribution Review and the ongoing Platform Review.

In particular, we are likely to see more providers introduce explicit account maintenance charges for both fund and share accounts, since they will no longer receive trail commission rebates from funds. The advantages and disadvantages of this change can be argued – certainly the improved transparency on exactly what clients are paying seems good – but it will probably mean a net increase in costs for smaller and less active accounts, which have traditionally been subsidised by the fees received on larger and more active ones.

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Binck Bank, DUTrade and other updates

There have been a number of updates to the stock broker directory recently. These include entries for:

  • DUTrade, an online broker based in Bahrain and covering much of the Middle East and North Africa
  • Dutch discount brokerage Binck Bank – reported to be a good choice for derivatives and structured products on European markets
  • IW Bank, the online brokerage arm of Italy’s UBI Banca
  • Hong Kong broker Core Pacific – Yamaichi

Other major additions to the site include a comparison table of US discount online brokerages for trading domestic shares and options – a long-standing request from readers – and a comparison table of Hong Kong online brokers. There’s also a comparison table for fund supermarkets in centres such as Luxembourg and Singapore that will accept foreign clients.

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UK CREST personal accounts comparison table

The UK stock brokers section now also has a comparison table for stock brokers that offer personal CREST accounts. If you’re unsure what personal CREST membership is, CREST is the UK’s central securities depository and you can find an explanation of why you might want a personal account there in the notes under the table.

There aren’t that many stock brokers that do this. The table lists the six main ones; some of the other traditional full service stock brokers may offer CREST membership as well, but are unlikely to be any cheaper. Other firms will be added if I get concrete details (many traditional brokers tend to be vague about fees, operating “by arrangement”, which makes compiling comparison tables awkward).

There is also one other small update to the UK listings, with the addition of HSBC InvestDirect/InvestDirect Plus to the stock broker directory.

 

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Boom Securities expands Japan markets and other Hong Kong stock broker updates

There are a few additions and updates to the stock broker directory for Hong Kong international stock brokers. Perhaps most notably, the purchase of Boom Securities by Japan’s Monex Group has led to some expansion of its Japanese markets offering. As well as the Tokyo stock exchange, it now offers Osaka and the three smaller regional ones: Nagoya, Sapporo and Fukuoka.

New additions to the directory include BOCI Securities (BOCI Online), KGI and HSBC Hong Kong. These three firms are unlikely to offer much that isn’t already available for most international investors, but have been added to try to make the directory more comprehensive. There are a few other firms that should be added in the near future.

BOCI Securities states that “commission rate will be determined and agreed between customer & BOCI Securities”, which isn’t terribly helpful in giving an idea of how expensive it might be. Any investors who have used it and can give an idea of what typical rates are is welcome to leave a comment below or send an email via the contact form.

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Standard Chartered Bank Securities Trading and other Singapore stock broker updates

There are a number of new additions and updates to the international stock broker directory. One interesting one is Standard Chartered Bank Securities Trading, which moved into the Singapore brokerage market a few months ago with an unusual product.

It offers online trading in Singapore stocks for 0.2% per trade (0.18% for those with a larger banking relationship) and 0.25% per trade (0.2% for favoured customers) for Australia, France, Germany, Hong Kong, Japan (including both the Tokyo and Osaka stock exchanges), the Netherlands, Switzerland, the UK and the USA. This has no minimum commission, which is rare in the brokerage business and attractive to customers trading smaller amounts.

There are also apparently no account and no inactivity fees, custodian fees, no dividend collection fees, no corporate action charges, making it a commendably clean fee structure. There is one catch though; currency conversions done through Standard Chartered are considerably worse than many Singapore brokers, with users reporting a margin of 2% over the interbank rate. However, you can hold and fund foreign currency accounts with the bank, so you shouldn’t need to pay this every trade, if you’re careful.

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Small updates to UK stock broker details

There are a handful of small updates to some of the UK stock brokers in the stock broker directory and comparison tables, few of which have much impact on international investing.

1) Interactive Investor has now launched its own share dealing service (previously it was a white label of Halifax Share Dealing). The stock broker directory and comparison tables have been updated where relevant, but the company has not yet been given its own entry because this provider is of very limited interest from an international investing perspective and seems to be experiencing some severe teething problems with the new Interactive Investor service.

If it introduces any major improvements to the service – there is some talk of more countries being added – this will change.

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International stock broker updates – Charles Stanley, Daniel Stewart, HMS Markets, Finasta, Orion Securities

There are a number of updates to the directory of international stock brokers. These include details of five more firms – two from the UK, one from Luxembourg and two from Lithuania – with a few more on the way.

Charles Stanley is a long established UK broker and it offers international stock trading for much of Asia, Greece, Poland and South Africa as well as the usual developed European and North American markets. This is a full-service private client stock broker, which means that fees are a little than the discount stock brokers and you’re probably looking at minimum trade sizes of £2,500-5,000 to be cost effective.

On the other hand, once you factor in better execution and other costs, firms such as these may be more cost-effective for larger international investments. For example, the currency conversion charges that most discount stock brokers charge should be far less with a good private client firm.

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