# Rabo Direct Investment Account



## legaleagle6 (27 May 2007)

I've just set up a Rabo Direct account and I plan on investing on a monthly basis in the Funds that they offer.

Anyone have any advice on what Funds I should look to put my money into and the breakdown between Funds? I am planning on investing €150 monthly for the next 2/3 years.

Thanks all.


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## ClubMan (27 May 2007)

Why not invest in _Quinn Life _funds and avail of lower charges? 

 versus [broken link removed].

There are also other fund providers with lower charges than _Rabo_.


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## TheBigLebows (28 May 2007)

Clubman, you're like a broken record with regards to Rabo and their fees. Everytime someone asks a question in anyway related to Rabo, you tell them that that their fees are too high. The poster asked a specific question of which funds might be best to invest in, not "do you think Rabo funds are too high".  
To the OP the only advice I would give would be to pick a diverse selection of funds. Maybe some of the riskier ones such as china, India, a few less risky funds, some bond funds, some commodities and maybe some mixed funds.


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## room305 (28 May 2007)

I'll chime in with another "broken record" - beware the tax issues ...


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## ClubMan (28 May 2007)

TheBigLebows said:


> Clubman, you're like a broken record with regards to Rabo and their fees. Everytime someone asks a question in anyway related to Rabo, you tell them that that their fees are too high.


Obviously not every poster reads every other thread and the issue of fees is quite pertinent to queries such as this. If you don't like my posts then see my signature.


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## RaboDirect (29 May 2007)

To continue the broken record theme - it's also fair to point out that Quinn Life offer index funds which are passively managed and RaboDirect funds are all actively managed funds, the majority of which have independent ratings from Morningstar or Standard & Poor's. 

Fees (and their transparency) are obviously a very important point for the potential investor. But when assessing a provider one should also consider the total offering, ie, fund range, diversification opportunities, online access, reporting, ratings, whether or not financial advice is offered (we don't) etc etc.


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## GreatDane (29 May 2007)

ClubMan said:


> Obviously not every poster reads every other thread and the issue of fees is quite pertinent to queries such as this. If you don't like my posts then see my signature.


 

Eh

Without wanting to take the entire thread off topic, your signature ain't working mate


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## TheBigLebows (29 May 2007)

ClubMan said:


> Obviously not every poster reads every other thread and the issue of fees is quite pertinent to queries such as this. If you don't like my posts then see my signature.



So have you any intention of responding to the specific question the OP asked or did you just come to this thread with the sole intention of bashing Rabo?


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## ClubMan (29 May 2007)

Garrettod said:


> Eh
> 
> Without wanting to take the entire thread off topic, your signature ain't working mate


It is.



TheBigLebows said:


> So have you any intention of responding to the specific question the OP asked or did you just come to this thread with the sole intention of bashing Rabo?


I have addressed part of the question - the original poster might want to look at the funds provided by a lower charging fund provider. I don't really have an answer to the question about what mix to go for because it really depends on many details (e.g. attitude to risk/volatility, other debts/savings/investments, how fixed the 2/3 year timeframe is likely to be etc.) that are not clarified by the original poster.



RaboDirect said:


> To continue the broken record theme...


Funny how _The Dude _is keen to criticise my broken record but not this one (to which I have no objection by the way).


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## GreatDane (29 May 2007)

ClubMan said:


> It is.
> 
> ....


 

Hi

Sorry, but it's not appearing from where I'm sitting.




Also
Taking the thread back on topic, do you reckon Quinn are cheaper when one considers the current promotion:


[broken link removed]



Thanks

G>


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## ClubMan (29 May 2007)

There's still an exit fee of 0.75% and an annual management fee of between 0.7% and 2.0%.


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## matrix1 (29 May 2007)

RaboDirect said:


> ...
> Fees (and their transparency) are obviously a very important point for the potential investor. But when assessing a provider one should also consider the total offering, ie, fund range, diversification opportunities, online access, reporting, ratings, whether or not financial advice is offered (we don't) etc etc.



Hi RaboDirect,

Reflecting on your experience of charging 0% entry & 0.75% exit fees this month, is it possible that you could afford to make this permanent? Your website suggests that you can in some circumstances take a cut of the yearly management fee and thus potentially recoup some of the "loss" of not charging an entry fee. This would certainly enhance the attractiveness of RaboDirect going forward.

It is a shame that you can't deduct tax at source, but your calculator is eagerly awaited!


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## Bronte (30 May 2007)

Don't get it - is the signature the smily face with two eyes open and if it is what does it signify?


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## messyleo (30 May 2007)

certainly, if you're buying to hold (thus exit charges only come into play as a once off) the may offer makes rabo very competitive i feel, given the choice of funds. the annual charges are similar to quinn in many respects e.g. for emerging markets ql charge 1.5% p.a. and some of the rabo funds only charge 1.2% for these markets. I guess if you just want a standard irish or european type exposure, QL is probably you're best bet, but if you're looking for some exposure to commodities, property and more exotic markets i think there's definitely a place for rabo. Btw Rabo, well done on the no exit charges offer for May - twas super


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## RaboDirect (30 May 2007)

matrix1 said:


> Hi RaboDirect,
> 
> Reflecting on your experience of charging 0% entry & 0.75% exit fees this month, is it possible that you could afford to make this permanent? Your website suggests that you can in some circumstances take a cut of the yearly management fee and thus potentially recoup some of the "loss" of not charging an entry fee. This would certainly enhance the attractiveness of RaboDirect going forward.
> 
> It is a shame that you can't deduct tax at source, but your calculator is eagerly awaited!


 
We do take a small trailer fee from the annual management fee but it's pretty small. The annual management fees are set by the fund manager so our trail fee doesn't result in a higher price than if you bought the fund directly from the fund manager. 

By eliminating the entry fees completely we would be foregoing 50% of the transaction costs which is a very large drop. The rationale for dropping the entry fees for May was of course to encourage people to purchase funds in the post SSIA environment and this coupled with the minimum €100 investment amount lowers the barriers to entry for investors. Naturally we keep our pricing under continual review and the question arises - if we dropped our entry fees completely would this lead to a substantial increase in volume that would justify the revenue foregone. Our crystal ball hasn't come up with an answer just yet on that one!


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## matrix1 (30 May 2007)

RaboDirect said:


> We do take a small trailer fee from the annual management fee but it's pretty small. The annual management fees are set by the fund manager so our trail fee doesn't result in a higher price than if you bought the fund directly from the fund manager.
> 
> By eliminating the entry fees completely we would be foregoing 50% of the transaction costs which is a very large drop. The rationale for dropping the entry fees for May was of course to encourage people to purchase funds in the post SSIA environment and this coupled with the minimum €100 investment amount lowers the barriers to entry for investors. Naturally we keep our pricing under continual review and the question arises - if we dropped our entry fees completely would this lead to a substantial increase in volume that would justify the revenue foregone. Our crystal ball hasn't come up with an answer just yet on that one!



Hi,

Thank you for replying.

I would imagine that you could gain some insight into the fees question by seeing if there is a statistically significant increase in contributions to your "fund of the month" over other funds, and also the impact of your May '07 "no entry fees" promotion. My gut feeling is that people are incentivised by the "fund of the month". It could be harder call on the May promo due to SSIA money sloshing around!

I currently like the idea of a monthly investment (other than pension) of smallish amounts of money. To this end, with the help of AAM, I see Rabo, Quinn, and Eagle Star as contenters. Quinn offer trackers, but now with a good range of options and no fees beyond low yearly management fees. This is good! I would imagine they are doing well. Eagle Star (via execution only broker and 7.5k Eur upfront) offer a wide range of trackers and active funds for a low management fee, but some exit penalties on a sliding scale for the first five years. Rabo offer an interesting range of active funds, a decent interface, but seeming rather high fees. I do feel from reading AAM (and also my personal view) that people like the range of Rabo funds, but that the fees are a real issue. 

Since Rabodirect are competitive on deposit accounts, it would seem that you have the appetite to be extremely competitive. I can see that it would be difficult for you to remove all exit and entry fees for active funds (although I'd imagine you might have some leverage with Robeco, a part of Rabo bank [I believe]). [Aside: I suppose you could investigate introducing a few passive index trackers with no entry/exit fees and see how it works out.]

Back to your existing fund selection: Assuming that the "fund of the month" works well, I guess you could hypothetically look at something like 0.5% entry, 0.5% exit for Eur 100 - Eur 500 purchases of one fund, dropping to 0.25% entry, 0.5% exit for "fund of the month", and then 0.25% entry, 0.5% exit for amounts of Eur 500+, dropping to 0% entry, 0.5% exit for "fund of the month" for Eur 500+. I am not sure what ClubMan would consider to be a good deal (perhaps he could comment), but something like this would be a lot more attractive to me! The lower your fees, the more likely (my guess) that people will buy to hold (as mentioned by gravitygirl above), the less churn, and the more you will make on management fees as the fund holding grows! It would be nice to see you somewhat competitive with ETFs etc. I would potentially be a risky move, but Irish people seem to be getting more picky about fees!

On the tax issue (which keeps getting mentioned), a simple calculator that is initially targeted at (a) Self Employed and (b) PAYE worker that presents "this is what you enter ... on this Revenue form available here ... in these fields" would make things clear for most. Some worked examples might help.

Cheers!


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## messyleo (30 May 2007)

some good ideas there matrix! however i think rabo seem to set themselves up as an investment solution for the novice/small time investor (not to say they don't attract larger investors too) so offering lower fees to those who invest more than €500 a time might not go down well with those who have joined rabo because of the minimum €100 payment. also such a scheme may take away from rabo's 'regular investor' product, and encourage people to save up for a few months till they have €500 rather than put in an automatic €150 a month say. obviously such a reduction in fees would be great news for us though 

QL operate a system whereby fees are reduced after a certain period of investing with them - perhaps rabo might operate a similar structure in the future; say after 5 years investing with rabo, entry fees fall to 0.25% or the like?

As matrix said, the range of funds with rabo is certainly to be commended and the fees are reasonable by many other banks' products, i guess the type of people who hang out at AAm (myself included ) are just always seeing where we can save a few cent


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## matrix1 (31 May 2007)

I would prefer to see the exit fees dropping for longer term investments than the entry fees. 

Dropping the entry fees for one fund per month is a good promo tactic.


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## ClubMan (31 May 2007)

gravitygirl said:


> the fees are reasonable by many other banks' products


So what? Doesn't make them reasonable per se.


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## South (31 May 2007)

Club - if you don't like them then don't buy them.

However, there is no point comparing an apple with an orange and saying that one is dearer than the other.


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## NDynamite (31 May 2007)

Hello Rabbo.
I have a substantial amount to invest but couldn't transfer it to Rabbo within May. Perhaps ye will run the zero entry fee for June? Remember the release of  SSIA is a slow burn.
Thanks
N


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## RaboDirect (31 May 2007)

Well the good news is that we are extending the zero entry on all investment funds until Tue June 5 to give everyone a few more days to get their orders in.


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## NDynamite (1 Jun 2007)

Still kind of tight for me, trying to get my money out of another bank, but a problem with EU rules etc is making it slow. I appreciate 'Rabbo' being the most 'on the ball' company of the moment.
Thanks
N


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## minion (1 Jun 2007)

Me too.
Just transferred all of my SSIA money into my rabobank account yesterday but it still shows a zero balance when i try to buy funds.  The transfer of the money into the savings account is still pending.
If i cant buy them by sunday without the entry charge i'm going to Quinn Life with 20k odd i have put aside for investment.
I refuse to pay an entry fee + management fee + exit fee.


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## RaboDirect (1 Jun 2007)

minion said:


> Me too.
> Just transferred all of my SSIA money into my rabobank account yesterday but it still shows a zero balance when i try to buy funds. The transfer of the money into the savings account is still pending.
> If i cant buy them by sunday without the entry charge i'm going to Quinn Life with 20k odd i have put aside for investment.
> I refuse to pay an entry fee + management fee + exit fee.


 
Minion,
If you place your orders for funds up to and including Tuesday you won't be incur any entry fees.


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## minion (1 Jun 2007)

RaboDirect said:


> Minion,
> If you place your orders for funds up to and including Tuesday you won't be incur any entry fees.



Thanks Rabo,

I'll do that if the money is cleared by Tuesday then.

I've already sent away the form etc for Quinn-Life and will be investing there in the future.

Its just that its convenient to use the money in my rabo account to invest in rabo funds while the charge isnt there, but it wont be, when the entry fee is back, so it will be Quinn form then on, unless Rabo make themselves competitive.


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## South (1 Jun 2007)

The funds Rabo offer are actively managed, the Quinn Funds are passive, so the charges on each will of course not be equal.


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## GreatDane (2 Jun 2007)

Hi

Dare I ask whats Rabodirect's definition of actively managed, compared with passively managed please ?

I like the online features from Rabo etc which is part of the reason I use them ... sure, rates & charges also play an important part I grant you.


The fact that Rabo has failed to pass on the entire 0.25% of recent interst rate rises was disappointing, I might add !

... for a long time, Rabo led the charge in terms of offering the best rates but recent rate rises have seen Rabo "skimming" the rate increases, in terms of what they pay the customer. The introduction of higher interest rate, regular savings accounts, from Anglo, Hallifax etc has certainly caught my eye and made me ask, how come Rabo don't offer something similar for regular savers with better rates than their demand, savings account ?


I'd also like to see Rabo offer the opportunity to have interest paid more than once per year on it's savings account.  Sure, I know ... the rate would have to be reduced a little if this happened, but it would still be better than having to wait a year to get your interest imho.



Rabo could really benifit from further investment in it's online offerings to deal with:

* Tax payable on Investments
This is something which is seriously impacting on Rabo's potential to get more investments in, from what I can see on AAM and from speaking with friends, family etc.

The tax calculator has been promissed for some time now, but has yet to materialise

There is little or no detail on how tax is dealt with for the Investments, on Rabo's website, that I can find. There needs to be a decent FAQ on the site ... much of whats discussed on AAM.com could be included for a start !

An option to have a tax payment deducted at source would be excellent. I say option, because I appreciate there are complications for various types of investors etc.

However, if there were an option to have a deduction made each time you cashed in a profitable fund and have this paid directly to Revenue by Rabo, I'd take it. I'd far rather be in a position where I was looking for an annual rebate of an excess payment to Revenue, than have to try and face dealing with how to report earnings on these funds in an annual tax return etc.

Finally, I've said it before and suspect I'll find myself saying it again but fair play to Rabodirect for being willing to face the public via AAM.com ... it's only a shame other institutions would not do the same thing !

Thanks

G>


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## minion (5 Jun 2007)

Sorry Rabobank,
Still no sign of €22000 SSIA clearing in my rabo savings account that i transferred Monday last week.
Since it now costs to even enter a fund that money is now off to a Quinn Life.
Pity, it was there for the taking.


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## GreatDane (5 Jun 2007)

Hi

Out of interest, is the delay due to Rabo or your SSIA provider ? .. if it's Rabo's fault there has been a delay, surely they can help you out if you make direct contact with them ? 

Cheers

G>


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## minion (5 Jun 2007)

Garrettod said:


> Hi
> 
> Out of interest, is the delay due to Rabo or your SSIA provider ? .. if it's Rabo's fault there has been a delay, surely they can help you out if you make direct contact with them ?
> 
> ...



Its been gone from my other account and pending in my rabo account since last Tuesday.  Completely down to Rabo.
To be honest i couldnt be bothered contacting  Rabo about it.   I wanted to take advantage of their offer but cannot because they were too slow to clear the money.  Since i have now gone through the process of opening a quinn-life account i might as well go with them with regular payments as they are cheaper than rabo anyway.

Im not the only one that feels rabo are an expensive option for investment.

Only 10k earns 5% so you might as well invest anything over, but with someone who has the lowest charges.


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## South (6 Jun 2007)

I'd rather buy something useful for a tenner than something bogstandard for 8 quid!!


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## Sunny (6 Jun 2007)

minion said:


> Im not the only one that feels rabo are an expensive option for investment.
> 
> Only 10k earns 5% so you might as well invest anything over, but with someone who has the lowest charges.


 
I agree there are cheaper options but it all comes down to choice. I have used Rabo as I like some of their funds that they have on offer but I can understand people who stay awqy due to charges and tax problems etc. And be careful making your investment decisions based on solely the lowest charges. They should certainly form part of the decision but should not be the only factor.


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## GreatDane (6 Jun 2007)

minion said:


> Its been gone from my other account and pending in my rabo account since last Tuesday. Completely down to Rabo.
> To be honest i couldnt be bothered contacting Rabo about it. I wanted to take advantage of their offer but cannot because they were too slow to clear the money. Since i have now gone through the process of opening a quinn-life account i might as well go with them with regular payments as they are cheaper than rabo anyway.
> 
> Im not the only one that feels rabo are an expensive option for investment.
> ...


 


Hi

thanks for the answer, I've no hidden agenda here btw, just being a bit nosey 

What does it mean, if it shows a payment as "pending", is this like uncleared funds or something ?

Agree with you regarding the €10k limit @ 5% btw, particularly when you look at the fact that the ECB went up another 0.25% today and chances are Rabo won't increase their rates by a full 0.25%, just as they have skimmed a bit in the past few rate increases, to pull back on the amount over ECB they have been paying depositors.

Cheers

G>


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## matrix1 (23 Jun 2007)

I see that Rabo has the following on their fees page [broken link removed] :
"*Investment Fees *Should you invest €1,000 in any of our Investments Funds the entry cost of 0.75% will be included in the overall cost. "

Does this mean that they waive the entry fee for investments of over Eur 1000 in any particular fund?


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## RaboDirect (24 Jun 2007)

matrix1 said:


> I see that Rabo has the following on their fees page [broken link removed] :
> "*Investment Fees *Should you invest €1,000 in any of our Investments Funds the entry cost of 0.75% will be included in the overall cost. "
> 
> Does this mean that they waive the entry fee for investments of over Eur 1000 in any particular fund?



No. It means that the 0.75% charge of €7.50 on your purchase is included in the €1,000, ie, not €1,007.50. The entry fee for the fund of the month is 0.25%.


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## matrix1 (24 Jun 2007)

RaboDirect said:


> No. It means that the 0.75% charge of €7.50 on your purchase is included in the €1,000, ie, not €1,007.50. The entry fee for the fund of the month is 0.25%.



A shame...

Thanks!


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