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Charles Stanley Direct Review

as of 06/06/2019 at 3:41 pm

Holly's View

This is an example of a service which has steadily improved and is competitively priced – although not as low as it once was! The language and content has been made easier for a less confident investor although the initial landing page dashboard is fairly daunting. The service is good, choice is plentiful and the research (once you find it!) is helpful. A solid contender for many people who can see beyond complex dashboards and the more than occasional slip into jargon.

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Recommended For

In a nutshell

Good customer service

Wide choice of investments

Good fund research

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Your overall rating

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Don’t want to take our word for it? We ask existing customers and investors to rate their experience with the company – based on value for money, overall service and the website. We need at least 20 customer reviews before we add anyone to our Best Buys list.

Based on 68 reviews

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What to Expect

  1. Ease of use
  2. Mobile & Apps
  3. Behind the scenes
  4. Customer opinion

The website has undergone a lot of changes over the last year with the logged-in state a lot clearer and easier to use.

If you’re an inexperienced or tentative investor the ‘Not sure where to start’ function is a clear, simple way of determining what might be the right investment for you. Once you’ve found your way to the right product or investment, trading is straightforward, the reporting is clear, and the customer service is good.

The app has improved a lot recently, and you can now trade and add funds. However, trading shares is still not possible in the app.

The app is a lot cleaner than the desktop version and their secure messaging feature should be common across all apps. The ability to customise what is displayed on the app is handy and you can reveal more information by tilting to a landscape view. The app still features a lot of jargon but is visually very appealing.

There are two sides behind the scene. The newly updated pages such as the image to the left, are clean with improved functionality. However, within the older pages, there is often a lot of small font and many numbers on a page – probably a nightmare for those with tricky eyesight. Overall there is a nice visual display of fund research although the pages do carry a lot of jargon.

This word cloud has been created from customer reviews of Charles Stanley Direct.

Pink is positive and grey is negative.

The size of the word indicates the frequency of mentions.

Investment Choice

Products

Stocks and Shares ISA

Junior ISA

Investment Account

Pension

Investments available

Own brand funds

Stocks and shares

Investment help

The 'Geeky' Details

Provider details

Charles Stanley Direct is a relatively cheap way to invest for those with less than £50,000 to invest, at 0.35% per year, plus any fund management costs. There are no fund dealing charges, so for investors putting small amounts into a few different funds on a monthly basis it is low cost. You can also buy company shares. There is also an annual £120 fee for a pension for investors holding less than £30,000 on the platform.

It will be a bit overwhelming for less confident investors who have a huge range of investments to navigate and not that much help with any filters. There is lots of choice and research available. The so-called Foundation Fund list shows their favourite funds which is useful. There is also a range of all-in-one funds – the Charles Stanley Multi Asset Funds – for those that want all the investment done for them. These are active funds which are relatively pricey in comparison to passive options.

Expect to pay about 1% all-in for a self-selected ‘active’ portfolio – this is good value. It’s worth considering for Junior ISAs too.

Important Facts & Figures

Provider Size:

Mid-sized investment platform administering around £2.5bn
Minimum amounts: £50 minimum monthly payment (£100 for pensions)
£500 minimum initial investment into a fund
12 month indicative performance:

Charles Stanley Direct's fund range has less than one-year track record.

Your Questions

"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"

Matthew, London

30/05/2019

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Your question

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

Matthew, London

30/05/2019

Holly Mackay says

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.

Holly

"Where can I get a good Junior ISA?"

Rebeccah, Greater London

27/03/2019

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Your question

Where can I get a good Junior ISA?

Rebeccah, Greater London

27/03/2019

Holly Mackay says

You need first to decide where to get the Junior ISA (which is the wrapper) and then decide what to put in it – cash, stocks and shares, funds etc.

 

We’re a bit suss on Cash Junior ISAs – if you’re saving for a baby then we think the stock market is likely to do better over the long-term. However there are good rates available for cash Junior ISAs – currently Nationwide and Coventry are offering 3.25% but these do change so please check online for current deals.

 

Many parents choose an investment platform for their stocks and Shares Junior ISA. Have a look at which ones we suggest here: Hargreaves is not the cheapest but they offer decent value and they are big and solid. Cheaper, but still good options, are AJ Bell, Charles Stanley Direct or Fidelity.

 

These platforms all offer a wide choice of investment options to put in a Junior ISA, too wide for many novices. That said, there are plenty of tools to help you find the right option: recommended fund lists and so on. In general, people tend to be over-cautious with their children’s money. You may have 15+ years to invest. That gives you a long time to ride out the ups and downs of a stock market. I know that people don’t like the thought that the capital value could drop, but over the long-term, the stock market generally outperforms cash.

 

For those new to investment, multi-manager funds might be an option. These are like ready-meals versus choosing the ingredients and making the meal. For less confident investors, it takes some of the pain away from choosing individual stocks or funds. Many of the platforms have their own versions – see here from Hargreaves Lansdown, AJ Bell and Charles Stanley Direct.

 

A cheaper option would be the Vanguard LifeStrategy 100% option, available through the Hargreaves platform. This is a passive fund and costs 0.24% instead of the HL Multi-Manager 1.46%. Passive funds are where computers just pick the world’s biggest stocks in proportion to their size. And if oil is out of favour, well you still have the oil shares. And if retail is going gang-busters, well you don’t get any more than the proportionate weighting. You are buying the average.

 

Active managers cost more because they employ expensive people to make a bet on which stocks will do better – if they love M&S, they can buy twice as much of it. If they hate Easy Jet they can sell it all. Passive guys can’t do this. They have to hold what we call the ‘index weighting’ – if HSBC is 5% of the main basket of shares, the FTSE 100, they have to hold 5% in HSBC shares.

 

Finally, in terms of paying into your Junior ISA, it is worth setting up a direct debit every month. That way, you drip feed into these and run less risk of investing when the market is at its highest, through simple bad luck and bad timing.

"Following the announcement of the platform increase at Charles Stanley Direct I think this is an ideal time to review my finances. My ISA started out with 100% in St James's Place, but following new investments and transfers over the last 3 years, I currently have about two thirds of my ISA in funds with Charles Stanley Direct and about one third left with St James's Place. Having outperformed the St James's Place funds with my own choices, I was planning on transferring the remaining one third to Charles Stanley Direct. However the recent announcement in platform price increases at Charles Stanley Direct is making me have a serious re-think. Having less than 250K invested, it seems to put me in the worst position possible, with the 40% increase in platform fees. I also have a private pension that I transferred to St James's Place, and I contribute a small amount into it monthly. Would I be correct in thinking the fees are also high on this, and I could do better elsewhere? Can I transfer into an SIPP for example? I'd be very interested to hear your thoughts."

Gerry, Bedfordshire

15/08/2018

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Your question

Following the announcement of the platform increase at Charles Stanley Direct I think this is an ideal time to review my finances. My ISA started out with 100% in St James's Place, but following new investments and transfers over the last 3 years, I currently have about two thirds of my ISA in funds with Charles Stanley Direct and about one third left with St James's Place. Having outperformed the St James's Place funds with my own choices, I was planning on transferring the remaining one third to Charles Stanley Direct. However the recent announcement in platform price increases at Charles Stanley Direct is making me have a serious re-think. Having less than 250K invested, it seems to put me in the worst position possible, with the 40% increase in platform fees. I also have a private pension that I transferred to St James's Place, and I contribute a small amount into it monthly. Would I be correct in thinking the fees are also high on this, and I could do better elsewhere? Can I transfer into an SIPP for example? I'd be very interested to hear your thoughts.

Gerry, Bedfordshire

15/08/2018

Holly Mackay says

It’s hard to comment without seeing the specifics but here’s a general opinion.

We should take a long-term view of performance, as short-term tests have even shown that my cat Mog could outperform over a year, just by sitting on the logos of the shares she likes! This year for example if people have backed Amazon, Apple and Facebook, they will have done super well – but at some point this will crumble a bit and some lesser-known firms which have been unloved will come back – and so the cycle will turn. So be careful about judging performance on anything less than 5 years, although I know we all do it. Pre tech crash I was the best fund manager in Australia (in my opinion)! During the crash, I realised that I had been youthfully arrogant, and in fact one of the worst!

That said, if you are picking a good mix of funds from around the world and you’re doing OK, then the lower fees you get as a DIY investor can make your long-term returns higher. I am generally negative about St James's Place because they're not clear enough on what they charge, and they can charge very high initial fees or high exit fees. BUT a good adviser will do more than simply pick funds for you, so it depends on your views about the overall service you are getting.

As for Charles Stanley Direct, well yes it’s a 40% hike BUT it’s still a reasonable 0.35%, which is slap bang on the industry average. So they are not taking the mickey here.

I see no reason really why you would not continue with the planned move of the rest of your ISA to Charles Stanley Direct. You could shop around to try and find somewhere for 0.25%, but it sounds as though you have had a lot of change and admin already. I’d pull the ISA into one place, breathe for a year, then you can always move if the service isn’t up to scratch?

Your pension is trickier. I believe – and do check – that St James's Place charge exit fees on pensions which start at about 6% a year, which I hate. This reduces by 1% a year. If so, there’s not much point in moving it today. But there’s no rule to say you can’t set up a SIPP elsewhere and chip into that monthly.

I would on balance leave the St James's Place pension in place until such time as there will be no exit fees – check how long this will be. In the interim, you can set up a SIPP online. You may as well do that at Charles Stanley Direct for convenience. As long as you have more than £30k on their platform, you won't pay the fixed fee for a SIPP - just the ongoing 0.35%, which is OK.

Again with a DIY SIPP make sure you spread investments around geographically. Have some global funds, not just UK stuff. Look at the Best Buy fund lists on Charles Stanley Direct and others such as Hargreaves Lansdown. If you’re unsure a ‘passive’ multi-asset fund such as the Vanguard LifeStrategy range is cheap as chips, will do all the picking and mixing for you, and is a simple and easy way to set and forget.

Hope that’s helpful.

Holly

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