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Hargreaves slashes minimum investment for D2C

Hargreaves slashes minimum investment for D2C

Hargreaves Lansdown has slashed the minimum investment needed for direct consumers to access its model portfolio proposition, which was formally launched this morning (2 June).

In September, FTAdviser reported that Bristol-based Hargreaves plans to launch actively managed portfolios for direct clients in the first half of this year.

At the time Hargreaves said the minimum investment was expected to be no more than £10,000, however it confirmed today in a statement announcing the launch of what it describes as its “third way” service that the minimum investment will be just £1,000.

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The ready-made portfolios for non-advised investors, called Portfolio+, are built, managed and rebalanced by the investment research team, headed by Mark Dampier.

Danny Cox, head of communications at Hargreaves Lansdown, explained that it will provide investors with a fully managed portfolio by taking three simple steps online.

Firstly investors choose to aim for growth or income, then select either conservative, balanced or adventurous risk tolerance, and finally select whether to use an Isa, self invested personal pension, fund account, or Junior Isa.

Mr Cox said: “This service can meet the needs of first-time investors, who are yet to build up the knowledge and confidence to choose their own funds, right through to retired investors who simply want to leave investment decisions to someone else.”

Every six months, in February and August, the portfolio will be rebalanced back to its original weightings.

There are six portfolios to choose from designed to achieve different aims and objectives, and constructed using the firm’s multi-manager funds as building blocks,

There are no account set up charges, no initial charges for the funds and no additional on-going charges. Investors instead pay the ongoing charges of the underlying funds and the Vantage annual charge of up to 0.45 per cent per annum.

Of the six portfolios to choose from, ‘adventurous growth’ is the most expensive with an estimated total expense ratio at 1.46 per cent, followed by ‘balanced growth’ at 1.45 per cent, ‘conservative growth’ at 1.39 per cent, ‘conservative income’ at 1.35 per cent and ‘adventurous’ and ‘balanced’ income both at 1.34 per cent.

peter.walker@ft.com