28th May 2014
Fund platform Cavendish Online is arguing that although Hargreaves Lansdown may have secured the cheapest AMC for Neil Woodford’s new fund, a combination of platform charge and AMC means that they are still the cheapest way to access the new fund.
Mr Williams says although Woodford has offered Hargreaves Lansdown a 0.65% AMC and additional 0.05% rebate, once Hargreaves Lansdown’s 0.45% platform charge is factored in investors will pay 1.05% with Hargreaves Lansdown compared to 1% with Cavendish Online.
He adds: “Hargreaves Lansdown may have secured the lowest AMC at 0.65% and an additional 0.05% rebate sweetener but once you add their 0.45% platform charge for portfolios up to £250,000 the overall cost is higher than the 1% overall cost investors will pay with Cavendish Online. Although the AMC through Cavendish Online will be 0.75% we only charge a 0.25% platform fee, making a total of 1%.
“This demonstrates that even though Hargreaves Lansdown have the clout to negotiate lower AMCs their customer’s don’t always benefit from them because their platform charge is so much higher. In fact, the CF Woodford Equity Income Fund is the 18th fund in Hargreaves Lansdown’s list of 28 Wealth 150+ funds that is available for less through Cavendish Online.”