Baillie Gifford want to transfer my Scottish Mortgage fund. Is this a good idea?

18 July 2019

Question by Matthew

We currently have around £135k in a Scottish Mortgage fund with Baillie Gifford. We’ve received a letter stating that they plan to transfer us to Hargreaves Lansdown who will charge the same fees as Baillie Gifford for 3 years. Is this a good idea or should we look elsewhere? Should we consider Charles Stanley Direct, for example? Matthew

Answered by Holly Mackay

Making their products available in supermarkets
Lots of fund managers have over recent years, decided to stop looking after retail customers directly and have made arrangements with alternative platforms.

This is like some product manufacturers deciding that they will no longer sell direct, but instead they're going to make their products available in supermarkets or department stores.

Hargreaves Lansdown I guess, could in this analogy be seen as a bit of a John Lewis, where you will be able to hold your Scottish Mortgage Investment Trust and access it online.

I have to say, that Hargreaves Lansdown's service is exemplary, and they're generally very well recommended by customers.

On the basis that you are not going to be charged more than you are today, I think it's probably a very good deal. You certainly can try the service for a year, and see how you go, knowing that you've got time to move should you want to.

Jumping ship
I would suggest in this instance, to see how you go before jumping ship.

The other good news is that because you have the Scottish Mortgage Investment Trust, Hargreaves Lansdown do cap the annual administration charges on investment trusts. So down the track after the 3 year period has expired, if nothing else has changed, you will be charged very reasonable fees.

The other thing that Hargreaves will do, is to let you have a look around and see if you want to diversify your holdings. Should you wish to do this, you won't have to open up multiple accounts with lots of different providers.

Hope this helps.


Answered by

Holly Mackay

Founder and CEO of Boring Money

I’ve worked in investment markets for over 20 years. I started out at Merrill Lynch Investment Management and worked at a few big names before setting up my first business in 2008.