Interactive Brokers Review
Eligibility: Anyone over 18, it does vary from country to country to where it is acceptable. It does however accept U.S citizens in a number of countries. It is worth checking if you are eligible in your country of residence.
Life Insurance: Not applicable
Minimums: $100 although due to the charging structure, does favour those with high amounts as is done on a fixed basis.
Charges:
Establishment Charge Structure: There is no establishment charge
With a monthly, fee of $20 for accounts below $100,000.
Other Charges: Dealing charges are $1 for US stock to $4.2 for U.K stocks Advisor fees can be between 1-1.5% per annum.
Full details can be found here.
Are charges explicit: Yes, they have no upfront fee, no inactive fee and charges are clearly stated. One point is that IBKR does have different locations. So, will have to see the fee schedule for the country of residence.
Documents:
Interactive Brokers Adviser Brochure
Interactive Brokers Guide
Interactive Brokers Terms
Surrender of the Interactive Broker trading account: There are no surrender charges and no early redemption charges as there is no commission charged. As a DIY platform with Swiss Quote, it’s one of the better ones in the offshore market.
As an advisor platform, it is pretty straightforward and has a range of asset classes and currencies. One, aspect for me personally, is that not all funds can be found on IBKR when I have looked for some obscure or new listed funds but it does have a pretty wide range and this will not impact most retail investors.
Although, Interactive Brokers does put in a web trainer and review to make it easy for beginners I would say it’s a hard platform to navigate if you are just starting out and could almost be used as a day trading account. I would state that this is not really an option for beginners.
Novia Global
Novia Global Ltd launched its Wealth Management Service in October 2015 with the goal of bringing the benefits of technology-enabled investing to the international financial market. They offer straight-through processing, portfolio management tools, a suite of management information and comprehensive fund research.
Policy Currency: AUD, GBP, USD, EUR, CHF, HKD
A minimum of 2% of the value of the currency holding will be maintained in the cash facility to meet these obligations. All cash and investments are managed by Novia Global in accordance with the rules of the Financial Conduct Authority.
Charges: 2 Charging Structures available – Clean and Retail, Clean
Establishment Charge – zero across all clients
Annual Service Charge
0.45% up to USD 500k
0.10% over USD 2.0m
Custody 0.04% excluding cash
FX 0.07% per trade
Dealing USD 5.00 per trade in GB, Luxembourg and Ireland
Funds: Circa 250+ Fund managers available. Circa 6,000 funds and 3,800 asset classes
Documents
Novia_Global_Key_Facts_2019
Pensions: A suitable platform for investments and pensions differing jurisdictions.
Surrender of Novia Global Plan: There are no surrender charges as there is no commission charged.
Henry’s View
Novia has changed the game in terms of offshore platforms, mainly for U.K pensions with its SIPPs as the trustee costs are 180 GBP. (see my Trust reviews), with no drawdown fee.
This is one of the cheapest in the market. As a platform, based in the Isle of Man, it has a solid protection framework. With its Custodian it has BNY and FCA regulations. The funds have a wide range in different assets classes and are more than feasible for retail investors.
Personally, and this is just my view I see this as one of the best platforms in the offshore market. Some of the drawbacks are that advisors can show base fees and make out they are higher than they are, so for example, I have seen firms quote the platform fee as 1% when they are taking a commission on the above amount.
See the charges PDF for full disclosure, but it should go on a sliding scale basis, 0.45% for anything under $500,000 to 0.1% for anything over $2 million. The other is that the platform is more designed for SIPPs rather than a lump sum and you might have to, depending on your location, have to put in a trust (an extra 180 GBP).
However, other than that, the platform offers flexibility in regards to withdrawals, no exit fees, and no establishment periods.
Nedbank Private Wealth
Nedbank Group Limited (‘Nedbank Group’) is a bank holding company, with its principal banking subsidiary being Nedbank Limited. The company’s ordinary shares have been listed on the Johannesburg Stock Exchange since 1969.
Policy Currency: Wide range of currency options with FX dealing facilities.
Banking services: Current account in 15 different global currencies, including Platinum Visa cards in GBP, USD & EUR (VISA cards not available if pension or insurance bond wrapped account)
Fixed-term & structured deposit
Lending (subject to terms)
Foreign Exchange
Charges: Focus is designed for those with a minimum initial combination in cash and investments of £50,000, US$75,000 or €75,000, of which at least £5,000 (or currency equivalent) must be in cash.
However, £7,500 minimum is offered for the collective discretionary managed funds. Transaction charges 0.5% or £50 minimum and £100 maximum
Custody Charges £25 per transaction ( UK or US securities ) £40 per transaction ( all others )
Custodian Fee 0.25% pa
Investment management fees on top. Life Wrapper fees –£150 pa
Annual Fees 0.375% pa
Termination fee 4% in yr1, reducing to 0% in yr. 4.
Funds No restrictions- access to all major markets.
Investment services
• Financial adviser wealth management platform – wherein the financial adviser manages the money on behalf of the client
• Client execution-only custody and nominee service
Discretionary managed portfolios available.
Can be used within life wrappers and provided their own life wrapper.
Documents
Nedbank Private Wealth Focus Brochure
Nedbank Private Wealth Terms and Conditions
Nedbank Private Wealth Focus Charges
Pensions: Yes, SIPPs, QROPs, QNUPs.
Surrender of Nedbank Focus: There are no surrender charges as there is no commission charged.
Henrys View
Nedbank is a good option, but like Novia, it depends on how it is set up with the IFA, as the charge can rise from the base cost of 0.25% to something unsavoury. It also offers a stable company option.
Other than that the platform, offers a flexible option (if not in a wrapper), in terms of withdrawals.
RL360
RL360, states it offers the latest technology with a wide fund range and protection.
Policy Currency: The RL360 PIMS Plan may be denominated in US dollar, GB pound, Hong Kong dollar, Japanese yen or Euro. Benefits will be paid in the plan currency.
RL360 PIMS Plan promotion: There is more than one option that clients should be aware of. PIMS Focused policyholders are able to invest into a defined range of approximately 1,000 investment funds. Accordingly, PIMS Focused has a lower charging structure than PIMS Flexible which has a fully open architecture.
Eligibility: RL360 PIMS Plan is a regular premium, whole of life, life assurance contract issued by RL360.
You can set up a policy in 1 of 7 currencies including Pound sterling (GBP), Euro (EUR), United States dollar (USD) Swiss franc (CHF), Australian dollar (AUD), Hong Kong dollar (HKD) and Japanese yen (JPY).
Minimums: Min £50,000 with minimum £5,000 top-ups
Charges: This is dependent on the way it is set up, note this is a commission-driven product and would not use this product over other platforms or cheaper bond options. Here is a way that it can be set up to describe the fee structure.
There are two options on charges: Option 1 – Establishment charge: The establishment charge is taken either on the start date of the policy or on the first day of each calendar quarter during the establishment charge period. A further establishment charge is made on each additional premium paid into the bond.
The actual charge varies depending on the charging structure that is chosen, one option for example for investment amounts up to £1,000,000 is 8.5% so this means that a charge of £85,000 will be charged against your RL360 PIMS portfolio bond. Alternatively, if the option of paying the establishment charge over 10 years is selected, then the charge is 1% per annum over the 10 year period i.e. £1,000,000 x 1% for 10 years = £100,000. If the policy is encashed early, then the whole amount of the establishment charge is deducted from the account.
Option 2 – Administration charge: RL360 PIMS portfolio bond will incur an administration charge on the first day of each calendar quarter for the lifetime of the policy of 8.5% and is a fee that is taken throughout the lifetime of your policy as a percentage of the higher of the premium or its current policy value. An early surrender fee will apply and you can choose from 8 years or 10 years.
Other Charges: There are also fund management charges, usually 1% to 2.5% pa each year- depending on the funds chosen.
There is a dealing charge made for each sale and purchase that is made within the RL360 PIMS portfolio bond of £20.00 so if you sell one fund and buy another then the charge deducted from your savings is £40.00 per fund. The first 10 dealing transactions on the policy are free of charge.
Additionally, there may be an adviser charge to manage the portfolio, this typically can be between 1 to 1.5% per annum depending on the chosen advisers charging structure and service provided. Pensions (QROPS and SIPP) – If the PIMS Bond is used within a QROPS or SIPP then there will be additional set-up and ongoing fees for the life of the policy if it uses Option 2 administration charges. This cannot be recommended. Option 1 charges (Establishment charges) lock the individual in for a set period and the initial years become extremely expensive compared to other options. EME does not recommend this product for QROPS or SIPP investing.
Are charges explicit: By explicit, it means that it is clear to see not only the charges for taking out the plan but also the cost of funds annually, any upfront fund costs, penalties on access, etc.
Yes, in the main the RL360 PIMS Plan charges are clearly shown and any professional should be able to interpret them. We have had feedback from clients though that they find it extremely difficult to interpret charges such as how any early access penalties would be calculated.
Documents
RL360 PIMS Brochure
RL360 PIMS Fact Sheet
RL360 PIMS Key Features
Policy Currency: The Old Mutual International (OMI) Executive Bond may be denominated in US dollar, GB pound, Hong Kong dollar, Japanese yen or Euro. Benefits will be paid in the plan currency.
Quilter Executive Bond promotion: Formally, Old Mutual International (OMI)
Why choose the Old Mutual International (OMI) Executive Bond: Both “approved” funds and open architecture are available – unlimited choice of funds. However, funds must be approved by OMI, including in-house and external funds and some funds are “mirror funds” which means you are buying a replica of a managed fund, not the actual fund, which leads to price discrepancies that can be large over time. Do NOT assume that funds approved by OMI mean they are recommended or safer options. Some funds are unregulated and very high risk.
Eligibility: The Executive Bond is a regular premium, whole of life, life assurance contract issued by Quilter, You can set up a policy in 1 of 7 currencies including Pound sterling (GBP), Euro (EUR), United States dollar (USD) Swiss franc (CHF), Australian dollar (AUD), Hong Kong dollar (HKD) and Japanese yen (JPY)
Minimums: Lump sum minimum of £50,000. You can make additional lump-sum payments into your policy at any time with a minimum of £2,500. However, you will pay any initial fund charges on all contributions.
Charges: This will depend on the type of plan you take out from Old Mutual International as they offer different charging structures largely linked to the amount of commission or earnings being taken by the third party.
Annual Policy Charges: There is an annual policy charge taken which is a fixed fee and this can be updated at any time. There may also be a percentage of the value of your fund to cover management costs in the early years which typically is between 1%-1.5% per annum and will last for 7 years sometimes through a lifetime.
Other Charges: Fund management charges are typically between 1 – 2.5% pa each year- depending on the funds chosen, but these are not typically listed at the point of purchase. Alternatively, if you are not used to collective funds then there may be stockbrokers fees when you buy and sell certain assets, but you will not see them listed on the valuation as stockbroker’s fees are included in the total value shown for each sale or purchase and will be reflected in the trade contract note.
Additionally, there may be an adviser charge to manage the portfolio, this is also typically can be between 0.5 – 1.5% per annum depending on the chosen advisers service provided.
Pensions (QROPS and SIPP) – If the OMI Executive Bond is used within a QROPS or SIPP then there will be additional set-up and ongoing fees for the life of the policy. EME does not recommend this product for QROPS or SIPP investing.
Are charges explicit: This is a commission lead product so it can be a lot higher depending on the IFA charges. How bonds work are based on establishment periods and AMC charges. So, for example, it can have an established period of 10 years which is 1.5% a year and this means that could be up to 7% commission (15% total of the duration) to the IFA.
Documents
https://www.quilterinternational.com/siteassets/documents/brochure/9208_wmp_product_brochure_english.pdf https://www.quilterinternational.com/siteassets/documents/fund-list/9209_wmp_fund_guide_english.pdf
Henrys View
Quilter is not a bad company and like a lot of the bond providers offshore and will not repeat myself, unless you have a vested reason to be in a bond I would opt for a platform.
In terms of bond fees, cheaper options are available with Hansard Z1 with amounts over $100,000.
