Platform Transfer Finally Completed and Pointless Trust Changes

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Good News! A transfer of one of my SIPPs from one platform to another has finally been completed today (22nd June). I initiated the transfer on the 12th January this year so this has actually taken over 5 months. A totally unreasonable period of time for what should have been a simple transfer of cash and a few direct shareholdings of UK listed crest stocks. However their failure to collect the tax refunds on PID dividends on some of the holdings remains outstanding and my complaint about both parties involved in the transfer to the Financial Ombudsman is ongoing.

Two investment trusts I have holdings in are Montanaro European Smaller Companies Trust (MTE) and JPMorgan European Smaller Companies Trust (JESC). The latter company has decided to change its name to JPMorgan European Discovery Trust with a new TIDM code of JEDT. Shareholders were not given any say on the matter, although the company says it “had discussions with major shareholders and the wider investor base”. All I can say they did not ask me! If they had, I would have objected.

The company claims the former name was inappropriate as some of their holdings have large market capitalisations but the new one is totally meaningless. There are lots of other investment trusts with out of date and inappropriate names – such as Scottish Mortgage. It’s just pointless changing the name and the new one is a poor choice. Brand recognition is important in naming trusts and changing the name unnecessarily will not help. They could at least have chosen a less bland name.

The other trust (MTE) has decided to do a 10 for 1 stock split. The company gives no justification for the change although the usual excuse for such a change is to improve the marketability of the shares. But who are they fooling? A share split makes no difference to the value of shares held. The current share price is about 1700p but if Berkshire Hathaway can happily get by with a market price of $417,290 why would MTE be bothered?

Roger Lawson (Twitter:  )

  1. Dylan Davies says:

    I requested a transfer of my pension back in October of last year, it got completed last week. Thank-you H&L, once again they excelled.:(

  2. Dylan Davies says:

    Why be sarcastic? I only stated the facts. Totally agree with you, totally unacceptable from a FTSE100 firm.

  3. Linda Hulls says:

    Yes, British Empire went from a recognised name to become dull as ditchwater “AVI Global”…

  4. Humphrey Lloyd says:

    As a long term happy holder of MTE I do not share your objection to the proposed MTE share split – I know it ought not to make any difference, but experience shows that a lower share price does improve marketability. The fact that Berkshire Hathaway has not split its shares does not mean it would not improve their marketability if they did. A share price of $417 would have more potential investors than one of $417,000. I appreciate that BH may not welcome private investors but that is a different matter. MTE appears more enlightened.

    • Mark Bentley says:

      For completeness, Humphrey, after much cajoling, Berkshire did eventually introduce a B class of share, originally 1/30th of the price of the A class stock – but that was further split and each B class share is now equivalent to 1/1,500th of an A class share, so the B class is currently trading at a more manageable $276. So private investors are now welcome!

  5. Tim says:

    Blimey! Well done for seeing it through!

  6. Humphrey Lloyd says:

    Thanks Mark, glad to hear that.

  7. Jeff Jones says:

    Thanks for the report Roger. During that 5 months, for how long were you unable to trade ? That seems to be one of the critical measures to me.

    I think the authorities need to take action on the transfer of accounts. There is no fundamental reason why after allowing (say) 14 days to process paperwork, the transfer from one broker to another should not be done almost instantaneously.
    A few years ago, the government made instant bank transfers mandatory and suddenly transfer times fell from 4 days to instantly.

    There is no reason why the same should not happen with stock brokers. In fact, to ensure a proper competitive market, transfers need to be fast and easy. Are you also contacting the FCA regarding this ?

    I am also unhappy with the JESC name change. It seems pointless to me and I have another ticker to remember, for no good reason.
    I’m not affected by the Montanaro share split, but since it makes no sense for anyone to buy anything as low as £17 in a particular stock, it follows that there is no need for a share split. BRK.A at $415,000 is in slightly more need of a share split !

    • rogerwlawson says:

      I did not even attempt to trade during the transfer process because I did not want to confuse either platform and I sold all the risky or volatile holdings beforehand to minimise the need to make any trades. I have other portfolios on other platforms where I could trade if necessary. But moving partly into cash for a length of time was certainly damaging when the market has been on a roll.

      ShareSoc has taken up the issue of platform transfer times with the FCA I believe. They should have been getting better from past FCA actions but clearly are not.

  8. rogerwlawson says:

    Regarding the question of “Improved marketability” from a lower share price, where is the evidence for that? I have never seen any. Why would a high share price put of any prospective buyers, or sellers, of the shares unless the share price gets to the enormously high level that Berkshire Hathaway achieved? At the current share price of JESC of 1700p, who would want to buy less than one share?

    There is a known problem with liquidity in smaller investment trust shares but I doubt that reducing the share price will help.

  9. Colin Childs says:

    BH is a trading company not an investment vehicle. Most likely out of ego. Just like Bezos. It’s American Exceptionalism culture.

  10. Mr ross Farmer says:

    5 Months is that all !!…………….. ITI Capital to Fidelity took 10 months !! and actually its still not totally completed !! No help from Ombudman either. Whole process is a TOTALJOKE !!

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