All wrapped up

Stockbroker Hargreave Hale has entered the SIPPs market with a new pension wrapper product.

The Hargreave Hale SIPP is designed to hold investments such as open ended funds, investment trusts, equities, traded options, derivatives, bonds and PIBs. It will also hold contracts for international equities and shares. Because the SIPP focuses on investments in which Hargreave Hale specialises, it will not allow investment in domestic property.

Administration for the product has been outsourced to Dunstan Thomas, a provider of pensions administration software and services. No initial fee is levied. The AMC is £250 but is waived if dealing charges in any given year are equal to or greater than this amount.

www.hargreave-hale.co.uk

MM View:

SIPPs are clearly popular products with the number of providers growing and the makeup of each product designed to target nearly every imaginable investor. While not a 'simplified' SIPP as is the case with those offered by Fidelity FundsNetwork or Prudential, this can best be described as an investment SIPP because its one major constraint is that it does not allow investment in property. This, however, should not be seen as a major drawback because the product was designed specifically to mesh with Hargreave Hale's business area, which does not involve property investment.

In terms of charges, Hargreave Hale said that it wanted to bring clarity to this market and, as such, has decided to keep its charges to a minimum. This is certainly the case with its lack of an initial charge. As seen in MM's SIPPs survey in April 2009, the majority of providers levy a setup fee ranging from £150 to £850.

Additionally, its annual charge is relatively low when compared to competitors, and even lower if share trading fees result in the fee being waived, although this could also be a red herring, since the provider will earn a fee one way or another.

geordie.clarke@ft.com