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S&S ISA advice

Investment discussion for beginners. Why you should invest your money, get help getting started
GeoffF100
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Re: S&S ISA advice

#458038

Postby GeoffF100 » November 14th, 2021, 9:22 pm

I have not looked closely at Trading 212, and it is not accepting new customers anyway.

Freetrade has been in business for 5 years now, and reportedly has a million customers. The Trustpilot reviews look good. Above all, the OP has little to lose.

The OP can open a GIA and make his first month's investment. He can compare any spread he is quoted against that on Hargreaves Landsdown's site. When he gets an execution price, he can compare that with the price at the same time on the LSE site. If he is not impressed, he can sell up and withdraw his money. If he is happy, he make further monthly investments.

When his portfolio value approaches £20K, he can open an ISA and pay some money in. He can then execute a near simultaneous sell in the GIA and buy in the ISA. He can then pay the proceeds of the sale into the ISA and repeat. That way, he can bed & ISA for just the spread.

plaguedbyfoibles
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Re: S&S ISA advice

#458329

Postby plaguedbyfoibles » November 15th, 2021, 9:48 pm

GeoffF100 wrote:I have not looked closely at Trading 212, and it is not accepting new customers anyway.

Freetrade has been in business for 5 years now, and reportedly has a million customers. The Trustpilot reviews look good. Above all, the OP has little to lose.

The OP can open a GIA and make his first month's investment. He can compare any spread he is quoted against that on Hargreaves Landsdown's site. When he gets an execution price, he can compare that with the price at the same time on the LSE site. If he is not impressed, he can sell up and withdraw his money. If he is happy, he make further monthly investments.

When his portfolio value approaches £20K, he can open an ISA and pay some money in. He can then execute a near simultaneous sell in the GIA and buy in the ISA. He can then pay the proceeds of the sale into the ISA and repeat. That way, he can bed & ISA for just the spread.


Thanks Geoff, that was a strategy I had in mind, but my dad tried to talk me out of it, claiming that Stamp Duty is charged on the purchase of ETF shares.

However, I pointed out to him that ETFs have been exempt from Stamp Duty since 2014.

So it looks like this is a strategy worth pursuing.

EDIT: For clarity's sake, would you mind confirming what you mean by spread and execution price? Thanks.

plaguedbyfoibles
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Re: S&S ISA advice

#458333

Postby plaguedbyfoibles » November 15th, 2021, 10:35 pm

GeoffF100 wrote:I have not looked closely at Trading 212, and it is not accepting new customers anyway.

Freetrade has been in business for 5 years now, and reportedly has a million customers. The Trustpilot reviews look good. Above all, the OP has little to lose.

The OP can open a GIA and make his first month's investment. He can compare any spread he is quoted against that on Hargreaves Landsdown's site. When he gets an execution price, he can compare that with the price at the same time on the LSE site. If he is not impressed, he can sell up and withdraw his money. If he is happy, he make further monthly investments.

When his portfolio value approaches £20K, he can open an ISA and pay some money in. He can then execute a near simultaneous sell in the GIA and buy in the ISA. He can then pay the proceeds of the sale into the ISA and repeat. That way, he can bed & ISA for just the spread.


Thanks Geoff, that was a strategy I had in mind, but my dad tried to talk me out of it, claiming that Stamp Duty is charged on the purchase of ETF shares.

However, I pointed out to him that ETFs have been exempt from Stamp Duty since 2014.

So it looks like this is a strategy worth pursuing.

Also, for clarity's sake, would you mind confirming what you mean by spread and execution price?

My understanding is that by spread, you mean market spread, which is the difference between the buying and selling price, and that the lower the spread, the more aligned the buying and selling price.

And execution price is the price at which the transaction took place.

Also, if I pursue the bed and ISA strategy, would this not be subject to the 30 day bed and breakfast rule?

GeoffF100
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Re: S&S ISA advice

#458358

Postby GeoffF100 » November 16th, 2021, 7:12 am

plaguedbyfoibles wrote:Also, for clarity's sake, would you mind confirming what you mean by spread and execution price?

My understanding is that by spread, you mean market spread, which is the difference between the buying and selling price, and that the lower the spread, the more aligned the buying and selling price.

And execution price is the price at which the transaction took place.

Also, if I pursue the bed and ISA strategy, would this not be subject to the 30 day bed and breakfast rule?

The spread is the difference between the buy and sell prices. You will find the buy and sell prices (delayed by 15 minutes) for VWRL here:

https://www.hl.co.uk/shares/shares-sear ... f-usd-dist

(VWRL has a tighter spread than VEVE.) You can see the prices at which trades are executing (delayed by 15 minutes) here:

https://www.londonstockexchange.com/sto ... mpany-page

No, an ISA is exempt from CGT.

GoSeigen
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Re: S&S ISA advice

#458366

Postby GoSeigen » November 16th, 2021, 7:32 am

plaguedbyfoibles wrote:Also, if I pursue the bed and ISA strategy, would this not be subject to the 30 day bed and breakfast rule?


The respective transactions within and outside the ISA are considered to have been done by different legal persons, or at least they are separate persons for tax purposes. So they are not caught by the 30-day rule, in the same way that bed-and-wife transactions aren't.


GS


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