Fund Platform
Encyclopedia
Fund Platforms fall into two distinct groups: Fund Wraps and Fund Supermarkets. Both are services that enable investors to buy investments simply online - usually at a discounted rate. In many cases the investments purchased can then be held on the Platform in a range of tax efficient wrappers. The investments that can be purchased via each Platform varies depending on the service provider too. Investment Platforms like these are available in the UK
. This type of investment
vehicle, is provided by a Wrap Service or Fund Supermarket provider. Shares, bonds and a range of funds from literally hundreds of fund managers can be held in many of them but it does vary from provider to provider. Individual investors can usually hold a range of investments within several different types of 'tax wrapper', such as:
The investments you can buy via these services and often hold on the platform itself can include:
These Fund Platforms aren't really products, they are services that enable investors to buy and often hold their investments online all in one place, with a degree of flexibility to switch investments around as their lives change without having to keep paying high charges for buying and selling them. Many provide the opportunity to buy assets in-specie, which helps the investor to switch investment without unnecessary charges. these services also cut down on paperwork.
Wrap services are online services where investors access their account details online. Fund Supermarkets are generally more transactional and are used for buying funds cheaply online - either by a financial adviser (on behalf of a client) or by the investor themselves.
Many investors choose to take independent financial advice, in the selection of a fund platform provider, in the selection of funds and 'tax wrappers' and in the ongoing monitoring of performance.
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
. This type of investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
vehicle, is provided by a Wrap Service or Fund Supermarket provider. Shares, bonds and a range of funds from literally hundreds of fund managers can be held in many of them but it does vary from provider to provider. Individual investors can usually hold a range of investments within several different types of 'tax wrapper', such as:
- Individual savings accountSavings accountSavings accounts are accounts maintained by retail financial institutions that pay interest but cannot be used directly as money . These accounts let customers set aside a portion of their liquid assets while earning a monetary return...
s (ISAsIndividual Savings AccountAn Individual Savings Account is a financial product available to residents in the United Kingdom. It is designed for the purpose of investment and savings with a favourable tax status. Money is contributed from after tax income and not subjected to income tax or capital gains tax within a holding...
) - EPPs
- QSPs or MIPS
- Personal Equity PlanPersonal Equity PlanIn the United Kingdom a Personal Equity Plan was a form of tax-privileged investment account. They were introduced by Nigel Lawson in the 1986 budget for Margaret Thatcher's Conservative government to encourage equity ownership among the wider population. PEPs were allowed to contain collective...
(PEPs) - offshore or onshore investment bonds (also called insurance bondInsurance bondAn insurance bond is a single premium life assurance policy for the purposes of investment.Due to tax laws they are a common form of investment in the UK and some offshore centres....
s) - personal pension planPensionIn general, a pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.The terms retirement...
, either insured personal pensions or Self-invested personal pensionSelf-invested personal pensionA Self-Invested Personal Pension is the name given to the type of UK-government-approved personal pension scheme, which allows individuals to make their own investment decisions from the full range of investments approved by HM Revenue & Customs ....
(SIPPs).
The investments you can buy via these services and often hold on the platform itself can include:
- direct mutual funds (i.e. Unit TrustUnit trustA unit trust is a form of collective investment constituted under a trust deed.Found in Australia, Ireland, the Isle of Man, Jersey, New Zealand, South Africa, Singapore, Malaysia and the UK, unit trusts offer access to a wide range of securities....
or OEIC) or investment trustInvestment trustAn Investment trust is a form of collective investment found mostly in the United Kingdom. Investment trusts are closed-end funds and are constituted as public limited companies....
or SICAV holdings - individual equities, corporate bonds
- cash
- EFTs
- VCTs
- hedge funds
- gilts
- structured products
- property partnerships.
These Fund Platforms aren't really products, they are services that enable investors to buy and often hold their investments online all in one place, with a degree of flexibility to switch investments around as their lives change without having to keep paying high charges for buying and selling them. Many provide the opportunity to buy assets in-specie, which helps the investor to switch investment without unnecessary charges. these services also cut down on paperwork.
Wrap services are online services where investors access their account details online. Fund Supermarkets are generally more transactional and are used for buying funds cheaply online - either by a financial adviser (on behalf of a client) or by the investor themselves.
Many investors choose to take independent financial advice, in the selection of a fund platform provider, in the selection of funds and 'tax wrappers' and in the ongoing monitoring of performance.