Around 130,000 investors who use online stockbroker Selftrade have recently received letters asking them to choose between transferring their accounts to another broker called Equiniti, or taking their money and assets elsewhere.
This is happening because Selftrade’s parent company, Paris-listed Boursorama, has decided to exit the UK stockbroking business and Equiniti has bought Selftrade’s ‘book’ of customers from it.
If you have an account with Selftrade, you may be wondering what you should do. The first thing to keep in mind is that the deadline for Selftrade to receive your decision is 14 November 2014.
You can give instructions either online via your Selftrade account, or by returning the forms you will have been sent by post. If Selftrade has not received your response by 14 November, your assets will be transferred to Equiniti but your account will remain locked until you separately accept Equiniti’s terms and conditions.
Transfers to Equiniti are scheduled to happen over the weekend of 22 November 2014. In fact, Equiniti is already the custody and settlement services provider to Selftrade – in other words, it already handles the behind-the-scenes administration of the assets you hold – so in theory the transfer process should be smooth.
Equiniti will not be using Selftrade’s front-end trading platform, so your online account will look different after the transfer, but the same services should be available.
Should you swap? Selftrade was not the cheapest service available for most investors, so this may be a good time to compare other providers and see if you can get a better deal.
However, Selftrade’s current charges will remain the same for 12 months and you’ll be entitled to a free transfer out to another provider at any time during that period, so you don’t need to rush into this.
As a result, investors who are uncertain as to what to do may find it easiest to move to Equiniti, then make up their minds once they’ve had a chance to test the new service.
If you already know you don’t want to move to Equiniti, you will have to close your Selftrade account and either sell your holdings, transfer them to a different broker, or turn them into certificated form.
Transferring to another broker will be free, but is likely to take several weeks to complete. So think carefully about whether you will need access to your portfolio in that time before choosing this option.