What should you consider when choosing your fund platform?

Unfortunately, as is common in financial services, things are more complicated than they seem initially. You may want to consider other factors than simply the annual charge and trading costs when deciding which fund platform or full investment platform to use (click on the Isa and Sipp tables to below to expand, or here for a round up of the cheapest or most-expensive Isa and Sipp providers).

Justin Modray, founder of Candid Money and Compare Fund Platforms, says: 'Perhaps the first question most investors should ask is whether they will ever be likely to want or need to hold shares - including investment trusts and exchange traded funds - in their portfolio via a platform.

'If yes, this will rule out the fund-only platforms such as Fidelity and Axa. The cost of holding shares can also prove high via some other platforms, such as Bestinvest, where an uncapped percentage fee applies.

'Investment choice is also worth checking. All platforms generally offer a decent range of funds these days, but some have a wider choice than others, so check the funds you wish to hold are available before investing.'

ADDITIONAL COSTS AND 'ADDED VALUE'

If you speak to some of the more expensive platforms about their charges, they will sometimes use the jargon term 'added value' to refer to other benefits that you get 'for free' for signing up with them. Hargreaves Lansdown produces a magazine for investors, for example.

However, remember that 'value' is strictly in the eyes of the beholder. If you want all the bells and whistles and are willing to pay for it, there is a platform for that. If you would prefer a pared-down service, where you pay a minimum fee and go about your business without additional input, there is also a platform for that.

Modray, says: 'The level of portfolio information, tools and overall service vary widely between platforms. The cheaper platforms are generally more bare-bones, and this is fine, provided you are happy with any limitations.

'If you want full portfolio analysis and tools, you'll likely have to use a more expensive platform and will need to judge whether the extra cost is worthwhile.'

It is also worth considering how much you might be forced to shell out when (and if) you decide to switch platforms or hide all your money under your mattress.

Modray continues: 'The platform market will no doubt evolve over coming years, so it is not out of the question that you might want to change platforms in future. Account closure and transfer fees are therefore important considerations.

'For example, Hargreaves Lansdown charges £25 plus VAT to close an account, a further £25 for cash transfers out and £25 per investment if you want to transfer them out "as is". By contrast, Fidelity charges nothing.'

Check exit charges on the website of any broker you are thinking of transferring to.

EXPERT VIEW

Steven Nelson, research manager at The Lang Cat and the man behind our traffic light price map, shares his view on choosing a platform: 'Wading through the different charging structures of investment platforms and getting to a level playing field can be tricky, which is why we put our pricing tables together.

'But we cannot emphasise enough that they are only a starting point. What is absolutely vital is that you understand exactly what you're looking for in an investment platform - and only you can do that.

'How often you trade or switch, how much guidance you need with investment choices and how much stock (pun intended) you place in a shiny, hyper-functional website are only some of the many questions you need to answer before making your choice.

'We'd also urge you not to be drawn in too heavily by marketing messages. Providers making promises of cheaper fund prices need to be viewed in the context of whether you can make the same (or indeed greater) savings on core platform charges elsewhere. In the industry, we call that total cost of ownership. It's really just common sense.'

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