Our Services
Our Managed Portfolio Service shall commence as at the date that your signed Investment Application Form is received and accepted by us and the recommended platform receives cleared funds. You understand that your opening an account with us will be confirmation of your agreement to these Terms.
Except in the case of joint accounts, you alone, as the party in whose name an account has been opened, will be treated as our client.
Our Agreed Mandate
We will, subject to your investment objectives and the level of risk you are prepared to accept, have absolute discretion to construct our managed portfolios, which reflect our investment process, views and theoretical portfolio construction, to fulfill various investment objectives.
We will not invest in individual asset types, that exceed the risk-tolerance of the typical retail investor in each portfolio. This includes Crypto-Currencies, Private Equity and other assets that cannot be readily valued or traded on a daily basis. We will also not invest in any asset that carries an unknown counterparty risk. We will also not invest in any investment market with low standards of governance.
The managed portfolios will consist of investments that are eligible to be held in the individual tax-wrappers. These managed portfolios may include, but are not limited to:
(a) Shares in British or foreign quoted companies.
(b) Debenture stock; loan stock; bonds; certificates of deposit; commercial paper; or other debt instruments, including government, public agency, municipal and corporate issues.
(c) Unit trusts, mutual funds and similar collective investment schemes in the United Kingdom or elsewhere.
The recommended platform will be responsible for carrying out the purchases and sales based on our managed portfolio instructions.
Investment Objectives and Risk Parameters
Risk and performance will be considered on the basis of the managed portfolio as a whole and not each individual investment held within each managed portfolio.
Ecology, Social & Governance
We invest with a conscience. Where possible our investment selection will usually filter out those companies which wilfully damage the planet. However our investment selection is un-constrained. If you require a dedicated ESG portfolio you should find an alternative service.
Restrictions on Types of Investment
This service does not provide for you to be able to state restrictions on what or where the assets are invested. If you wish to do so, you should find an alternative service.
Changes to Information Given
You must tell us about any change to the information you have given to us in connection with this service, or any change in your personal circumstances, requirements or investment preferences as soon as possible. You understand that unless we know about such changes, we cannot ensure that the managed portfolio chosen remains suitable for you.
Application of these Terms
These Terms will apply to each portfolio making use of our investment management service, either by you or on your behalf by a third party or in relation to which you have a material direct or indirect interest. These Terms will also apply to and be binding on any person exercising any power of appointment or delegated power (including without limitation the exercise of any discretion, permission or consent) delegated by you.
Investment Approach
Each managed portfolio model is constructed to meet a variety of investment objectives and risk profiles. The actual investments acquired and the proportions held will be derived from these models. This means that those clients with the same investment objectives and acceptance of risk, will generally hold the same investments in the same proportions. Variance in proportions however will naturally occur, due to timing issues and daily movements in prices. The managed portfolio or portfolios recommended and agreed by you should deliver the required investment objectives within the correct level of risk.
This means that when you place new money into our managed portfolio service, purchases of investments will be undertaken to bring the portfolio into line with the model. Occasionally, shortly afterwards, our research and screening process may register that an investment should be removed from the model. Consequently, a recently acquired investment may be sold.
Benchmarks
Any performance level or benchmark which we may use as a measure of performance in relation to any particular portfolio is set only as a illustration or non-binding indication of our performance and is not a representation or warranty that the performance level or benchmark selected will be achieved.
Execution Policy
We will provide the recommended platform with details of any alterations we believe to be appropriate to your portfolio by way of changes to our managed models. They will carry out the necessary transactions on your behalf. Rebalancing will occur at our discretion in the same manner when money is added to or withdrawn from your portfolio.
Reporting
As a discretionary manager, we are responsible for ensuring the provision of a periodic statement that will include documentation such as valuations and transaction reports. The recommended platform will be providing these to you on our behalf. Periodic statements will normally be provided quarterly.
At the time of the periodic statements, you may also be provided with a performance benchmark for a previous period. If you started the service during the period or if you have added to or withdrawn cash in the period the performance of your portfolio and the benchmark will not be comparable.
The appropriate benchmark will be dependent on the objective you select. You should be aware that when comparing your performance with that of the benchmark, there are no fees or charges accounted for by the benchmark.
Your Assets
The recommended platform will hold all securities and cash as detailed under their terms.
Aggregation of Orders
The recommended platform may aggregate your order with other orders as detailed in their terms.
Settlement
The recommended platform will undertake settlement as detailed in their terms.
Our Charges
Our management fee is levied monthly, charged at the rate of 1/12 of 1% per month based on the value of your managed portfolio.
Platform Charges
A maximum of 0.26% per annum + a plan fee for an ISA of £1 per month and a pension of £6.67 per month if applicable.
Equity (Share) Ownership Costs
When we add a share to your portfolio there are additional costs to consider.
Brokerage – Neither ourselves or the platforms we recommend are members of The London Stock Exchange, so a broker is required to source (or sell) the shares we choose for our portfolios. Individually the cost of buying a shareholding (any number of shares from 1 to 100,000s) is currently £3.75. However we seldom just buy a share for any one individual, instead we group individuals together when we trade. On average around 100 of us could each be buying the same share at the same time. Therefore the £3.75 brokerage fee is split 100 ways, reducing our personal cost to just 4p. This aggregate trading is one of the benefits of investing together.
PTM – PTM (Panel of Takeovers and Mergers) is a £1 government levy that is automatically charged to investors when they buy or sell shares for over £10,000 listed on the London Stock Exchanges. This tax is not levied on overseas shares.
Stamp Duty – You’ll pay Stamp Duty Reserve Tax (SDRT) if you buy shares electronically through the ‘CREST’ system (a computerised register of shares and share owners) listed on the main London Stock Market. SDRT is not payable on overseas shares or those listed on the Alternative Investment Market (AIM). The tax is taken automatically when you buy the shares, so you do not need to do anything else about your tax. SDRT is charged at 0.5% when you buy shares electronically.
Typical Equity Transaction Costs
As an example we have averaged out the additional costs incurred on a typical Moderate portfolio of £450,000 over recent years.
- Brokerage – 8p per transaction. There were 193 equity transactions.
- PTM Levy – 2p per transaction. There were 114 transactions.
- Stamp Duty – £28.15p in tax in total. There were 61 transactions.
This period was exceptional spanning the end of 2021 and most of 2022. Portfolios were altered greatly as inflation began to run away and interest rates were increased. Our results suggest that on-average the cost of direct share ownership should be around 0.05% of the value of the portfolio per annum. (£223 per £450,000)
Account Opening
In compliance with all applicable regulations and in conjunction with relevant Guidance Notes on the Prevention of Money Laundering, we are required to obtain and maintain sufficient client and account opening details and information to satisfy ourselves as to the identity, nationality, residency and tax residency of all account applicants and the source of their wealth and the source of funds for investment. In accordance with all applicable regulations, we require the completion of all compliance and account opening formalities.
You undertake that any money and other assets making use of this service do not constitute the proceeds of any activity which is illegal or unlawful under the laws of the United Kingdom or of any applicable jurisdiction or which would be illegal or unlawful were such an activity carried out in the United Kingdom or such other jurisdiction.
We may at any time exchange information with third parties to verify your identity and detect or prevent fraud or other illegal activity.
Joint Accounts
We may open a joint account, including partnership accounts, in which you may participate with others.
Unless we receive written instructions specifically to the contrary, we shall be entitled to act in accordance with the instructions of any one such person without incurring any liability to any other such person. We reserve the right to request the signature of all joint account holders where we, at our absolute discretion, believe this action to be appropriate. We accept no responsibility for any delays that may occur as a result of taking such action.
If you are a participant in a joint account, your liability to us shall be joint and several. In the event of death, bankruptcy, winding up or dissolution of any one or more of such persons, then (but without prejudice to the above, or our rights in respect of such person and his successors) the obligations and rights of all other such persons shall continue in full force and effect.
Upon the death of one party to a joint account, we will continue to provide the service under the existing criteria until alternative instructions are provided, regardless of whether the assets are held as Tenants in Common or as Joint Tenants.
Delegation
We may, at our discretion, delegate all or any of our functions hereunder to a company or other person connected to us (an “Associate”). We may also employ third parties (including Associates) to perform any administrative and ancillary services required to enable us to perform our services under these Terms. Where we delegate any function hereunder to an Associate, we will be fully responsible to you for all their acts and omissions as if they were our own. We will act in good faith and with due diligence in our choice and use of any delegate or agent.
Investment Returns
(a) The value of any investment and the income from it is not guaranteed and can fall as well as rise, so that you may not realise the amount originally invested.
(b) Past performance should not be taken as an indication of future performance.
(c) Changes in exchange rates could affect the value of your investments. Movements in foreign exchange rates can impact both the level of income received and the capital value of the investment.
(d) Where portfolios are managed by Independent Advice Ltd., each is managed to an agreed risk rated asset allocation to suit the needs and requirements of each individual client. We recommend those investments that we consider appropriate for inclusion in each portfolio. If we recommend a particular investment for inclusion in one portfolio it does not imply that it is suitable for any other portfolio.
(e) Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors. It may be possible to lose all your initial capital in certain types of investments.
Limit on our Liability
(a) Neither we nor any person connected with us owes any duty to disclose to you any fact, matter or thing which comes to our notice or the notice of any employee, director or agent of ours or any person so connected in the course of rendering similar service to others, or in the event that such disclosure would be a breach of confidence or duty to any other person.
(b) We will not be liable for any loss, liability or cost suffered or incurred by you as a result of our providing services to you unless the loss, liability or cost is caused by our own negligence, wilful default or fraud committed while acting on your instructions or any breach of any obligation we owe to you under the regulatory system. In such cases, our liability shall be limited to the replacement of securities or monies (including interest) lost or foregone as an immediate result of our action or failure to act.
(c) Neither we nor any third party who acts on our behalf in providing a service to you, whether affiliated to us or not, nor our or its directors, officers, servants, agents or representatives will be liable to you for any consequential, indirect, special, incidental, punitive or exemplary loss, liability or cost which you may suffer or incur arising out of our or its or their acts or omissions, howsoever the loss, liability or cost is caused and regardless of whether it was foreseeable or not. For the purposes of this paragraph, the expression “consequential loss, liability or cost” shall include without limit any loss, liability or cost which you may suffer or incur arising from your not being able to sell investments where the prices of the investments are falling or from not being able to purchase investments where the prices of the investments are rising, or from your not being able to enter into or complete another transaction which requires you to have disposed of or purchased the investments which you are trying to dispose of or acquire, and any other loss arising as a result of loss of business, profits, goodwill or data and any direct, special, incidental, consequential, punitive or exemplary loss, liability or cost, whether arising from negligence, breach of contract or otherwise and regardless of whether it was foreseeable or not.
(d) We will not be liable to you for our failure to perform any obligation or discharge any duty owed to you under these Terms if the failure results from any cause beyond our control. This includes, but is not limited to, any breakdown or failure of transmission or communication of computer facilities, postal or other strikes or similar industrial action, the failure of any relevant exchange, clearing house or financial advising platform operator and or broker for any reason to perform its obligations.
(e) Will will accept from a client a small percentage of execution-only instructions to transfer or buy equities outside of our managed portfolios. (Cherished assets) We accept no responsibility for managing those equities, prompting you to consider selling under-performing assets, nor any losses incurred on those assets. We reserve the right to refuse to allow you to hold specific execution-only assets on the platform, which clearly fall outside our investment mandate. The holding of these cherished assets will remain subject to our usual monthly fee,
Non-Reliance
These Terms together with such other associated Terms and Conditions as we may enter into with you form the entire Agreement between us. You acknowledge that you have not relied on any representation, warranty or other assurance (except as set out in these Terms or such other associated Terms and Conditions as we may enter into with you), whether oral, written, express or implied.
Mortality (Individuals)
Your death will not terminate any outstanding obligations under these Terms or any agreement, arrangement or understanding between us. These Terms shall be binding on your executors, successors and assigns as appropriate. Except for joint accounts upon notification of your death our Managed Portfolio Service and the discretionary management of your portfolio will cease; your assets will continue to be held by the recommended platform until Probate is acquired.
Effective Date
This Appendix is effective and was last updated on June 10th 2024.