invester
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Post by invester on Mar 15, 2018 11:59:31 GMT
Is there a cheap way to gain exposure to these if you only want to invest a small amount (c.£1k)? I had a look at BullionVault but the holding costs seem to be quite prohibitive.
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bigfoot12
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Post by bigfoot12 on Mar 15, 2018 12:18:53 GMT
Probably the easiest is to buy a coin or two. Krugerrands are often the cheapest, but if it is a UK coin then it counts as money so it is free of CGT (or at least it used to be when I last looked into this).
If this isn't going to be a very long holding you could buy as a spread bet on IG index or some similar platform, but this becomes more expensive with time.
EDIT minimum bet on IG is equivalent to buying about £6k of gold at the current price. EDIT my reply above is regarding gold only.
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SteveT
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Post by SteveT on Mar 15, 2018 12:58:45 GMT
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Liz
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Post by Liz on Mar 17, 2018 17:13:04 GMT
Don't forget you have to pay VAT on silver if you have it delivered.
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Post by GSV3MIaC on Mar 22, 2018 14:46:31 GMT
As SteveT says, an ETF (there are lots) is the simple way .. gold, silver, platinum, a mixture .. all available. Depending on your risk appetite, you might want to opt for 'physical' (there is about 5x or 10x the amount of gold 'sold' via ETFs than actually exists!) and ones which don't 'loan' it out for others to sell options on. If it's to protect against the end of civilization, then coins may be good (but don't put them in a piano and forget about them, as someone did .. lots of sovereigns and half sovereigns in fact). Mind you, for end of the world, baked beans and shotgun shells may be more use.
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james100
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Post by james100 on Mar 22, 2018 18:09:43 GMT
I have some gold for portfolio stabilization purposes using an ETF/C, iShares SGLN (physical) which has a pretty low charge of 0.25%. It's denominated in GBP but with underlying asset in USD it's effectively a double bet on GBPUSD and on the movement of the gold (see BullionVault charting in GBP vs USD to watch this in action). On fees for relative holding methods, if you go coins don't forget you'll generally be paying a bit more/weight unit for smaller units and you're likely to face a pretty big (3%-ish) difference between purchase and sales price and may only be able to sell back to your source, which can offset the cost savings. And you might want to buy a safe (good ones i.e. insurance/security certified are not cheap)...or the stealth route. It's volatile and gives no ongoing return so also make sure you are comfortable that it can do what you want it to do.
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invester
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Post by invester on Mar 23, 2018 8:13:41 GMT
Thank you for the advice.
Yeah I looked at coins but the effective cost per oz if purchasing in small quantity appears to be very high compared to the actual spot price and there is a further loss when selling it back. Effectively you would need a big market move to be in profit.
James, for iShares is the 0.25% the final figure for costs or are there any other hidden costs? I was looking at some ETFs on Hargreaves Landsdown but the costs seem really steep; for a £5,000 investment the fees over 5 years were coming out at something like £570.
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invester
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Post by invester on Mar 23, 2018 8:31:59 GMT
Sorry I just saw you couldn't buy iShares on their website and need to go via a provider. If I go via Fidelity, their fees are listed here: www.fidelity.co.uk/investing/feesIt says there is no service fee for investments in the Fidelity Investment Account, so if I hold it here, my all-in fee for the ETF will be 0.25%, is my understanding right?
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ding
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Post by ding on Mar 23, 2018 9:44:38 GMT
Sorry I just saw you couldn't buy iShares on their website and need to go via a provider. If I go via Fidelity, their fees are listed here: www.fidelity.co.uk/investing/feesIt says there is no service fee for investments in the Fidelity Investment Account, so if I hold it here, my all-in fee for the ETF will be 0.25%, is my understanding right? There could be a board here to just to discuss brokers. Make sure you go somewhere that doesn't charge you yearly fees (custodial). Unfortunately brokers tend to alter their fee arrangements every so often. I would suggest you look at Iweb. At Fidelity you should pay £0 for the ETF in a dealing account. Don't forget the dealing fee. I have such account (on the old fee structure) with a token £1k in Blackrock commodities. I am charged a service fee (pennies), when I queried this with them they said my SIPP service fees are taken from all accounts. Sounds like rubbish to me. My SIPP is 100% ETF/IT so is capped at £45 a year. Though I've paid £100+ which they are still looking into (and confirmed i'm being overcharged). Fidelity is a very complex beast! But still much cheaper then Hargreaves.
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james100
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Post by james100 on Mar 23, 2018 10:07:02 GMT
General fees to consider as follows:
1) Platform fee (flat ongoing, % ongoing, one-off, can be mix or variable) 2) Trade fees (sometimes free credits as part of 1), more likely flat one-off, sometimes also % commission - applies to both buy and sell) 3) Trade fee forex fee (applied at about 0.5-1.5% if you're buying a product using GBP that's not listed in GBP) 4) Product fees (known as ongoing fund charges or total expense ratios) 5) Additional product fees (transaction fees involved in rebalancing mixed equity/asset class products) 6) Buy/sell spread (invisible cost reflecting the premium you pay to purchase versus the typical sell price, generally reflects size and intensity of trading) 7) Taxes and duties (like stamp duty on UK equities) 8) Probably some more...
For SGLN (listed GBP), you would consider at least 1), 2), 4), 6)
I can't comment on Fidelity for 1) and 2) as I don't have an account. Item 4) is the 0.25% total expense ratio, wherever you buy it, and for 6) the spread is low...it averages around 0.05% but on lively days can be less than that (equally on slow days it can be more than that).
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bigfoot12
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Post by bigfoot12 on Mar 24, 2018 10:02:16 GMT
the effective cost per oz if purchasing in small quantity appears to be very high compared to the actual spot price and there is a further loss when selling it back. I bought some Krugerrands about 17 years ago, and I bought 10 at a time - so about £2,000. (The first 10 I bought were £199 each.) IIRC I paid about a 3% premium to pure gold (which didn't seem that bad to me). The UK coins were more expensive at the time, but were CGT exempt, but I was sure I would have been under my annual allowance so I stuck with Krugerrands. When I sold them a few years later I managed to sell at small premium to the gold price 0.5-1% so I was very happy with the total transaction costs. (I wish I hadn't sold them all!). The smaller the coin the more expensive it is (per gram). Perhaps because you are buying a single coin the costs are higher, and there will be more KYC/Money laundering type stuff now. Why do you want to buy metal? If it is to diversify, maybe you should accept that you are at a point were the costs of increasing your diversification outweigh the benefits. If you work out what you are trying to achieve there might be a fund or a combination of two, that might get close to what you want to do. (A daft example perhaps not really a suggestion - a global tracker fund plus some swiss francs in cash?)
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macq
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Post by macq on Mar 24, 2018 12:34:18 GMT
Sorry I just saw you couldn't buy iShares on their website and need to go via a provider. If I go via Fidelity, their fees are listed here: www.fidelity.co.uk/investing/feesIt says there is no service fee for investments in the Fidelity Investment Account, so if I hold it here, my all-in fee for the ETF will be 0.25%, is my understanding right? There could be a board here to just to discuss brokers. Make sure you go somewhere that doesn't charge you yearly fees (custodial). Unfortunately brokers tend to alter their fee arrangements every so often. I would suggest you look at Iweb. At Fidelity you should pay £0 for the ETF in a dealing account. Don't forget the dealing fee. I have such account (on the old fee structure) with a token £1k in Blackrock commodities. I am charged a service fee (pennies), when I queried this with them they said my SIPP service fees are taken from all accounts. Sounds like rubbish to me. My SIPP is 100% ETF/IT so is capped at £45 a year. Though I've paid £100+ which they are still looking into (and confirmed i'm being overcharged). Fidelity is a very complex beast! But still much cheaper then Hargreaves. Had the same problem with Fidelity and IT's outside an ISA and on phoning was directed to some small print about the spreading of fees across accounts when i suggested could it not just come from the ISA i was told that's not how we do it and just trust us! Think after reading of your overpayments need to check again.
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