UK ISA sharedealing account

[Lupo Lupus]

 

Any UK investors here? Can you recommend a good broker for an ISA (tax-free) account, mostly for trading shares? I did quite some searching but find it difficult to find a good broker (one who also offers non-UK markets at reasonable fees). Unfortunately, IB does not offer ISA accounts.

[forest81]

I use IG Sharedealing. They are quite good. Not as good as IB but 0.3% on forex and cheap transaction costs. Only downside is you don't get dividend notes. However I have got on very well with them. A lot more simple interface than IB and I find there customer service quite good.

[Lupo Lupus]

I use IG Sharedealing. They are quite good. Not as good as IB but 0.3% on forex and cheap transaction costs. Only downside is you don't get dividend notes. However I have got on very well with them. A lot more simple interface than IB and I find there customer service quite good.

 

I also come across IG Sharedealing. The 0.3% conversion charge seems reasonable compared to some others (many charge 1.5% -- which I think is absolutely crazy!!!). They have different market, but its seems in any market you can only buy the stocks in the major indices and not the universe of stocks, is that right?

 

What do you mean by not getting "dividend notes"? They dont inform customers about dividends?

[petec]

I use iii.co.uk (I was a TD customer and they sold to iii) and find them very good for access to developed markets at least. I also use Hargreaves but they are more of a fund platform so their international stock trading isn't as good.

[Voodooking]

I use AJ Bell YouInvest for my ISA and SIPP. They are competitive for fees and pretty decent to use overall.

 

Only drawback is they don't have as many of the smaller stocks available, which is why I use a Degiro account to trade illiquid and nano-cap Net Nets.

 

MoneySavingExpert.com has quite a good guide on ISA's and SIPPS.

[thowed]

The key problem is that most of the big names don't offer foreign currency accounts, so dividends and sales are all converted automatically back to sterling (with not very good fx rates).

 

TD Direct were one of the few that did, and I assume that this will continue (now they've been migrated to their new owners - iii).

 

I don't have experience with IG and DeGiro, I'm afraid.

 

Otherwise, iWeb are worth looking at as they're one of the few with no platform fee.

 

There are a number of comprehensive guides out there.  One of the more comprehensive is at monevator.com, though I can't remember if it touches on foreign shares much.

[tol1]

AJ for UK stocks and IB for non-UK ones.

[Dynamic]

I started my first with Barclays Stockbrokers when ISAs first started, which was a bit pricey and didn't include US stocks etc. which I wanted to invest in.

 

I've been with iDealing.com since 2003 and my spouse also has an ISA with them now. They seem to be a decent discount non-advisory broker.

 

£5.00 per quarter admin charge per account = £20 per year for each of us, which seems very reasonable.

 

£9.90 per trade dealing charges in US and UK. I tend to trade fairly infrequently with occasional flurries of activity, and my dealing costs are typically far below 0.5%, let alone my original 1.5% target.

 

US holdings are all I've done recently. Seems to only take "At Best" orders. I usually open a Quote window, put in the number of shares I hope to buy and either get a rejection if the price means I don't have the funds, or a live quote in GBP with around 10-20 seconds to place the order or cancel. Likewise, the Sell Price generates a quote I can accept or reject. Both quotes usually show the estimate funds I'll have after the trade if I accept the quote.

 

Other functions are shown, such as Limit orders, but these aren't available on US stocks. Think they're available on UK stocks on LSE, but it's been a while and I'm not certain.

 

If I want to track the USD price I bought at, it will necessarily be an estimate as the trade is conducted in sterling, so I take a note of the exchange rate reported by Google Finance at the time and calculate it myself for my trading journal/notes.

 

The effective exchange rate seems reasonably close to what Google Finance/Yahoo Finance reports so I don't feel I'm paying a significant surcharge. I have about 12-15 data points over the last three years that I could use to calculate the exchange rates I paid for buys, sells and dividends from USD. Let me know if you're interested and I can provide the dates and exchange rates achieved. Dividends will be most accurate as the USD dividend and the GBP proceeds after withholding tax are both known. My buy and sell prices were all quoted only in GBP.

 

The Account Valuation screen shows 15-min delayed UK prices but US prices might be up to a month or two out of date (e.g. I have 13-Apr-2018 closing prices showing at present, but probably had 02-Jan-2018 prices showing for about 6 weeks during which time I made purchases at different prices. This doesn't bother me as I track my portfolio valuation, my spouses and the combined portfolio all on Google Sheets using near-live GoogleFinance data and ignore all but the cash balance showing on iDealing.com.

 

In terms of portfolio history, I can see all my Trade History in stocks and shares back to opening the account in 2003 (but this doesn't show costs and stamp duty etc, but I presume this data is used to show the profit/loss on each position in my account valuation screen).

 

The cash account Client Ledger, which shows all cash flows in and out can only be shown up to 365 days in the past. I periodically save the Client Ledger to keep a record, and lately I've found it pastes nicely into a spreadsheet like Google Sheets, making it easy to keep track of the whole ledger over many years, just copy-pasting a few extra rows every time I trade, receive a dividend or reach the quarterly admin fee date. This makes it easy to add an extra column and calculate XIRR on my positions or portfolio.

 

iDealing.com does not process W-8BEN forms to reduce withholding tax on US dividends, so our dividends on stocks like IBM, WFC and AAPL have a 30% haircut instead of 15% and show up in the Client Ledger as simply "FX SWEEP" next to the cash credit.

 

Having only a few dividend-paying US holdings, I've always been able to attribute these FX Sweep incomes to the appropriate stocks so I can calculate per-stock XIRR. Our largest holding is BRK.B, so there's no dividend or withholding tax consideration there. As per ISA rules, all cash transactions and balances have to be in GBP. I've looked into a couple of other brokers who will process W-8BEN but didn't consider the 15% difference on modest dividend income worthwhile considering the higher account costs and exchange costs at the other brokers versus the potential savings and the amount of time I'm likely to hold such large positions in US dividend-payers now that much of the discount to intrinsic value in AAPL has narrowed and I've sold IBM and WFC to buy more BRK.B.

 

They only pay interest if the interest payment would exceed £1 but also pay Bonus Interest if the balance is large enough. I usually keep only small cash balances and don't expect interest at present. I've had more in the past, especially when rates were higher or I had large sums of uninvested cash.

 

Cash subscriptions via BACS/Faster Payment sometimes get credited within a day, sometimes almost a week (e.g. the first time we credited my spouse's ISA from our Joint Bank Account instead of the personal account it took about a week and a couple of emails to query the delay). You have to pre-register your bank account with iDealing and use the correct Reference to get it credited to your account, but it seems fine and they email you when it's been credited.

 

I don't subscribe to live streaming prices, but for long-term shareholdings I don't find delayed prices to be a problem.

The Trading Dashboard includes a Price Watch section for LSE shares and some others (but this part cannot track AAPL.NAS or BRK.B.NYSE) which do show in my portfolio with the most recent price they happen to have entered on their system (which may be well out of date). Again, I track my watchlist in Google Sheets so I don't care.

 

The Dashboard shows an "Open Chart" button which I have ignored until now. It doesn't seem to do anything when I click it, but I don't care - I'm working out what price I'm happy to pay (converted into Sterling) first and will maybe glance at a chart somewhere to get an idea if I'm likely to get that price. It works for me, but your mileage may vary.

[The Investor]

My wife and I use IG for our ISA, and IB for our taxable personal accounts. IB doesn't offer an ISA account unfortunately, as they are much better imo.

 

It's worth keeping an eye on Degiro, who say they are working on offering an ISA account, but don't do so yet. Very low costs, although I'm not sure what if any the downsides are.

 

Make sure to avoid any provider charging 0.x% per year uncapped. Hargreaves Lansdowne have capped their fee (0.45% capped at £45 per year). I believe that used to be uncapped, in which case it was a terrible deal, but now it's worth considering, as IG charge just under £100 p/a.

[Alan00]

I use IG, and Saxo.

 

IG are good, but need to add more overseas markets.

 

Saxo have a much wider range of overseas markets, but the default FX conversion fee is now 1% unfortunately.

 

I wish IB or DeGiro would provide an ISA account, feels particularly in the overseas section that more competition is needed.