Exchange-Traded Products

Exchange Traded Products (ETPs) usually follow the price movements of a financial index or benchmark (e.g. the FTSE 100) and can offer an alternative way to gain exposure to a wide range of markets, without incurring all of the costs of investing directly.

Costs of purchasing ETFs

Trade values below £100,000 UK & International share dealing 
FX rates apply for International

Introductory

Trade on our lowest online share dealing rate when you open a new account. After your first 3 months you'll move onto our Active, Frequent or Standard rate.

£5.95

Active 
Average 20 or more eligible* trades per month across the last 3 consecutive months

£5.95

Frequent 
Average 10 or more eligible* trades per month across the last 3 consecutive months

£8.95

Standard 
Standard rate if you don’t trade as frequently as 10 or more times per month

£12.50
Click here for trade values above £100,000 Looking to make regular monthly investments?

Non TD Direct Investing Costs

Ongoing charges: Between 0.05% and 1.25%

What's this charge for?

Charges taken from the ETF over a year. Regular charges applied by the ETF provider to cover the cost of running the ETF.

The Risks

  • Tracking Error - is the difference between the performance of the ETP and the investment it tracks. Tracking error depends on the market conditions at the time and can either be in the client's favour or against them.
  • Counterparty Risk - Certain ETPs use complex financial products such as swaps (see synthetic ETP for details), futures and options with other third party counterparties rather than purchasing the assets themselves to achieve investment performance. If the investment bank providing these complex products fails, the ETP may lose a part or all of the funds they had invested. Investors should consult the ETP's prospectus to understand the Counterparty risk associated with the product.
  • Liquidity Risk - In certain circumstances, it may be difficult for an ETP to trade particular investments within a reasonable time at a fair price, which may reduce the ETP's returns. Also, during periods of reduced market liquidity or in the absence of readily available market quotations for particular investments in the ETP's portfolio, the ability to produce an accurate daily value to these investments may be difficult.
  • Stock Lending (Collateral) - ETP providers can generate further revenue by lending their holdings (collateral) out to other third party institutions, such as investment banks. If these third parties fail and the holdings are unable to be recovered, investors could suffer a potential loss. Different ETPs have different exposures to stock lending and the ETP prospectus should be consulted to determine the Collateral Policy for that product.
  • Currency Risk - If the ETP's underlying holdings are in a currency different to the denominated currency, investors will be affected by fluctuations in foreign exchange rates.
  • Leverage & Short ETPs Risk -The more an ETP invests in leverage derivative instruments, the more this leverage will magnify any losses on these investments. For leverage index-based ETPs, the value of the ETP's shares will tend to increase or decrease more than the value of any increase or decrease in its underlying index. ETPs that offer leverage are highly complex financial instruments with a high degree of risk and are not suitable for all investors. Investors should carefully consult the prospectus before investing so they understand the risks associated with these products before trading.
  • Concentration risk - To the extent that an ETP's Underlying Index or portfolio is concentrated in the securities of a particular market, country, industry, sector or asset class, the ETP may be adversely affected by the performance of those securities, subject to increased price volatility and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting that particular market, country, industry, sector or asset class.
  • Tax - The tax treatment of an ETP is determined by your individual circumstances and the continued status of the ETP. The returns from trading ETPs could be subject to income tax rather than Capital Gains Tax. If you are unsure whether an ETP is suitable for your own individual circumstances you should consult a qualified tax advisor