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Portfolio Investment Account

What is Portfolio Investment Account?

Portfolio Investment Account is suitable for those comfortable selecting their own risk profile and portfolio without the provision of advice or need for active investment portfolio management. The account provides an option to choose from three ready-made portfolios consisting of investment funds, each of which reflects a different risk category. These portfolios are rebalanced quarterly.

This account does not carry the tax reliefs of investing as is the case with an Individual Savings Account (ISA) or a Junior ISA. If appropriate, investors and savers may therefore look to maximise their ISA allowance or Junior ISA allowance (in terms of saving for children) for any given tax year, before they use Portfolio Investment Account.

Is Portfolio Investment Account right for me?

The Portfolio Investment Account could be right for you if you:

  • Are looking to choose a ready-made portfolio of funds relating your selected risk profile
  • Want unrestricted access to your money
  • Have used your £20,000 ISA allowance this tax year (2018/19) and you are interested in investing more
  • You do not want to lock your money away in a pension until the age of 55
  • Want to invest without annual or lifetime limits
  • Understand that investment growth is not guaranteed
  • Are willing to accept that your money is at greater risk and are prepared to invest for at least five years

Who can set up Portfolio Investment Account?

You can set up Portfolio Investment Account, if you are resident in the UK and are aged 18 or over.

What investment options are available?

You can choose from three different portfolios consisting of investment funds, each of which reflects a different risk category. The risk categories and portfolios available are as follows:

  • Low to medium risk - Cautious portfolio
  • Medium risk - Balanced portfolio
  • Medium to high risk - Growth Portfolio

The description of each risk category, the composition of portfolios for each risk category and information on each constituent fund is accessible on Simply Ethical website.

Choosing a portfolio constitutes an instruction to us to buy each fund comprising the portfolio in accordance with stated allocation weightings. You cannot change the fund holdings, their respective proportions, remove existing funds or add new funds in the portfolio. If you do not agree with the exact portfolio composition or you wish to make changes, then Self Select Portfolio service is not suitable for you.

How often is the portfolio rebalanced?

We rebalance your portfolio by placing instructions with the Service Provider to invest, dispose of and re-invest cash in the constituent funds of your portfolio. We will rebalance your portfolio biannually on 12th day of January and July (or the first available Business Day after the 12th where such date does not fall on a Business Day). Rebalancing will return each of the fund holdings within the portfolio to the original allocation weightings.

What are the charges?

There is no set up cost.

The annual administration charge is tiered within bands as follows:

  • 0.85% per annum for the first £100,000;
  • 0.50% per annum between £100,000 and £500,000; and
  • 0.30% per annum above £500,000.

This charge is subject to a minimum of £12.50 per quarter. This charge is calculated daily, based upon the value of your investments and charged to the account at quarterly intervals on 31st March, 30th June, 30th September and 31st December each year.

Please read our Charges Schedule for complete details. This is accessible through our website www.simplyethical.com or by contacting us.

What is the minimum and maximum amount that can be invested in the Portfolio Investment Account?

The minimum investment to open an account is £2,500 or £1,000 plus £100 per month. There is no maximum limit to the amount you can invest.

For each account, you must maintain a minimum cash balance equal to 5% of the portfolio value.  If you don’t, or if the cash balance is insufficient to cover regular withdrawals or pay our charges, we may at our discretion sell investments in accordance with Self Select Service Terms and Conditions.

How do you deal with the cash I hold within Portfolio Investment Account?

Any cash within your account is held on deposit in a Sharia compliant bank account. No interest is paid on cash. 

Why do I have to maintain a minimum cash balance?

The minimum cash balance ensures that there is always enough cash in your account to pay all the charges you have agreed to pay, to fund any withdrawals you request, to credit the proceeds of any investments you decide to sell and to allow us to make all other credits and debits necessary to administer your account.

How can I make payments into my Portfolio Investment Account?

Single payments can be made electronically by instructing your bank. The relevant bank details and a reference number will be provided when your account is opened with us. Regular payments can be made by setting up a standing order with your bank.

How do I make withdrawals?

To withdraw money from your account, you are required to complete the relevant form available on Simply Ethical website. We will only place withdrawal instructions on the 8th day of each month (or the first available Business Day after the 8th where such date does not fall on a Business Day). Your money should be available in your nominated account within 4 working days of this date. Please note we need to be in receipt of relevant form by the 5th of each month to process the payments in the same month.

Any withdrawal request constitutes an instruction to us to sell each fund held within your portfolio by the same proportion to the extent required to provide you with the cash sum requested. We will not have any discretion as to which funds within the portfolio are sold.

Where are withdrawals made to?

For security reasons, we only make withdrawal payments to your nominated bank account. We do not pay withdrawals to third parties other than to your estate in the event of your death.

Can I transfer existing investments that I hold into the Portfolio Investment Account?

To transfer your existing account, please complete our online account opening application and the transfer form.  

We only accept transfer in the form of cash.

Cash transfer means that your current investments will be sold and the cash transferred to your account for you to buy investments of your choice (subject, of course, the investments being available on our platform and satisfying our ethical investment criteria).

Please be aware that a cash transfer means:

  • You may lose out on investment growth while your investment is not invested during the transfer period.
  • You may incur charges when you purchase new investments to be held within your account with us.
  • You will not have access to your account until such time as the transfer is complete.

What about tax?

Please remember that the tax benefits of any investment depend upon your personal circumstances and tax laws may change; so you should always refer either to your financial adviser or a specialist tax adviser for up to date tax advice.

Do I pay tax on any dividends or gains within my Portfolio Investment Account?

All income and capital gains from your account will be subject to capital gains tax and income tax, in accordance with your individual tax position.

What happens to Portfolio Investment Account if I die?

Once we are advised of the death, we must take steps to close the account. We will liaise with the persons dealing with the estate regarding the sale of any investments, so it is important that they hold details of the account.

What might I get back?

The amount you get back is not guaranteed and depends on a number of factors, such as:

  • How much you invested
  • The length of time you invested for
  • The performance of the investments you have chosen
  • How much our charges are
  • The amount of any withdrawals you have taken

Can I change my mind?

Yes. After we have opened your account we will confirm this in writing. You will then have 14 calendar days starting from the day you receive this to change your mind and cancel your account. If you decide to cancel, you should write to us at our registered address.

Once we have received your notification, we will give you your money back less any other payments, charges and fees in accordance with the Self Select Service Terms and Conditions. If your investments have fallen in value, you will get back less than you invested.

If you do not cancel your account it will continue in force in accordance with the Self Select Service Terms and Conditions.


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