Following Pfizer and BioNtech’s announcement today that early results from Phase III trials of their Covid-19 vaccine suggested that the vaccine was safe and effective, markets generally have soared. Cyclical and leisure/travel stocks in particular have benefitted whereas certain others have suffered.
With this market turbulence it is not surprising that many investors wanted to trade. However, I have seen widespread reports that certain major investment platforms, including Hargreaves Lansdown and AJ Bell/YouInvest have buckled under the strain and are not allowing their clients to trade.
This is simply unacceptable. I am recommending to ShareSoc’s board that we should write to the FCA, demanding that they put pressure on these highly profitable platforms to invest properly in their infrastructure to support the loads imposed by investors on busy days like today.
Mark Bentley
Director, ShareSoc
DISCLOSURE: the author does not hold shares in any of the companies mentioned.
Delighted to report that my colleague and ShareSoc Policy Director Cliff Weight has now written to the FCA – and has had a response already: the FCA will investigate these issues. We are also arranging a (virtual) meeting with the FCA.
HLs bookkeeping app had such a lag some users were able to sell the same position multiple times and are now short. This happened to me in a SIPP. SIPP platforms presumably shouldn’t be allowing you to short.
My experience too with HL. I thought my original sale hadn’t gone through.. but it had. Had to buy back in later, but at a cost.
Definitely one to watch for us retail investors. I’ve lost count of the number of times AJBell has gone down over the last year – at first, I shrugged and said it was the cost of doing business but their complete lack of transparency over what they’re actually doing to address this issue has been extremely disappointing (multiple customers have been told to use the phone service which is considerably more expensive – pretty much defeating the point of AJBell marketing themselves as an ‘affordable’ brokerage).
Hi Henry, Note that where you are forced to deal on the phone because of a systems failure, AJ Bell will generally still charge you the online dealing rate. If they haven’t, ask them to refund the difference.
Best, Mark
Thank you Mark, that’s really helpful to know.
It is not just in high-volume periods that delays or lock-outs occur. In normal trading periods, some platforms are quicker than others to update the portfolio after a trade.
I use A J Bell, Halifax and X-O, and normally AJB is the quickest and most reliable of these in updating the true position fully.
It can be frustrating sometimes to see the net cash balance up to date in the Cash Statement but not in the Available to Trade section, so that I am locked out of buying till the full update, which can take several minutes.
I would certainly encourage pressure on platforms to make their web pages work faster – I consider that no more than a 5 second gap should occur between carrying out an action and having the whole platform ready for another action.
It goes without saying that all platforms should be able to cope with the tasks for which they are paid, namely providing trading when the market is open and holding assets purchased, transferring out those assets sold, collecting and allocating dividends, dealing with other corporate issues and keeping full and accurate records.
Hi, Just a comment that may be useful in your discussions with the FCA. I have an HL account, and have also noticed problems with its slowness. The layout of the transactions tab and the capital account tab are also quite counter intuitive. It sometimes takes a day or two to update my account after cash is deposited. Should be instant. I also dislike the fact that there is no balance column listed in these account tabs – as on a bank statement. However I also have a Charles Schwab USD account – easy to open through the Charles Schwab UK website for UK citizens. The platform is utterly brilliant and oh so fast, even though I am based in the UK. The dealing costs are now absolutely ZERO to buy and sell stocks etc, and the margins are minimal, so great for fast trading of US type stocks. If I transfer GBP to this account it happens the same day at an extremely competitive exchange rate. However HL charges 1% for every transaction (as they have to be carried out in GBP every time) to cover its conversion fees on top of the dealing cost – a vast profit on top of the normal deal fee levied. With HL one is unable to have a dollar based dealing account. One drawback is that CS does not have ISA or SIPP accounts, but it is a great way to deal a vast array of stocks if you have cash to spare. Maybe if HL were to look at what this leading world competitor is doing, and it is publicised by you to the UK investor world, HL & AJB may start to take notice and start modernising their old fashioned platforms, which are no longer fit for purpose in this fast internet age. Especially if UK citizens start dealing through the Charles Schwab platform, denying HL & AJB lucrative chunk of USD based share trading business. After all HL makes over £350M profit every year, so should be able to set a large chunk aside every year to continually modernise its platform. Also with Brexit just round the corner, these UK dealing platforms need to be state of the art very quickly if we are to benefit from the UKs leading share and bond trading history. It seems that greed for profits overrides technical development and a continual lowering of dealing costs, leading to poor customer experiences.
I have an account with Hargreaves Lansdown and couldn’t access it yestarday.
As well as lack of access yesterday I notice that HL no longer supplies Broker Forecasts or Trades on, what was, a useful “At a Glance” page. They suggest going to the London Stock Exchange Website instead – well there you go eh ….
I also noticed that Roger Lawson blogged about previous problems in Dec last year 2019. His blog today includes this..
“The big problem faced by many investors though was that platforms such as Hargreaves Lansdown and AJ Bell Youinvest actually ceased to function. It is reported that their customers were unable to log in and trade. But this is not a new problem. See this report in December 2019 when there was a previous bout of euphoria that affected the same two brokers: https://roliscon.blog/2019/12/16/euphoria-all-around-but-platforms-not-keeping-up/ .
They clearly did not learn their lesson and should have done better “load testing”. Perhaps the moral is don’t put all your eggs in one basket by relying on one broker (I use 5 different ones and spread my holdings over them).”
I am delighted to hear of the engagement with the FCA. It is disgraceful that clients are unable to buy and sell stocks because the platforms cannot cope with higher volumes. This is potentially costing investors significant amounts of money and the platforms must be upgraded to provide the service we deserve. I would leave HL but am simply concerned that other platform providers may be just as bad.