See how we compare
| nutmeg | Typical discretionary manager |
Financial advisor (IFA) |
DIY Investing (Execution only) |
|
|---|---|---|---|---|
| What they do | Build and manage your investment portfolio. | Build and manage your investment portfolio. | Advice about investments, pensions, wills and insurance. Some IFAs offer investment management either in-house or outsourced. | Enable you to buy and sell shares and funds. |
| What you do | 10 minutes online to get started. | Face-to-face meetings. | Face-to-face meetings. | Choose what funds and/or shares to buy/sell. |
| Minimum investment |
£1,000 | Typically £250,000 and up. | Typically £50,000 and up. | None. |
| Ongoing management |
Regular rebalancing included. | Depends on the service. 6-month reviews are common. |
Depends on the service. 6-month reviews are common. |
None. |
| Transparency | Total transparency, online 24/7. | Often paper-only, with reports once a quarter or half-yearly. | Often paper-only reporting. Online reporting if investment management outsourced. | Online 24/7. |
| Fees | 1.0% or less, including VAT. |
1% or more, with discounts available for multi-million investments. | £75-£250/hour. | Typically £12/trade, or less with high-volume trading. |
| Underlying portfolio cost |
Avg. fund cost—0.3% | Avg. fund cost—1% | Avg. fund cost—1% Platform fees—1% and up. |
Avg. fund cost—1% for actively-managed funds, less for ETFs and trackers. |
| Additional costs |
No trading fees or setup fees. | Trading fees of around 1.2% of transaction value. Additional transaction administration fee often charged. | Trading fees—up to 0.5% Setup fees—up to 3% |
Stamp duty—0.5% if buying shares |
| Getting money out |
Free, anytime. Faster withdrawals for a small fee. | Depends. Exit fees are common. | Good IFAs shouldn't have exit fees. | Trading fees on selling shares or funds. |
Sources: hl.co.uk, pamonline.com, moneysavingexpert.com, The Guidance Gap Report, Cass Business School, Jan 2013.
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