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Investing: Understanding Fees and Expenses

An important aspect of making the most of your investments is keeping track of the fees and expenses that are being charged. Different financial institutions and products may have different pricing structures, so it makes sense to check how much certain investments are costing you and whether there are any better options available which help you to keep more of your earnings.

Transaction fees and management fees

When you’re investing, there are normally two types of fees that apply: transaction fees and management fees. The former typically apply when you buy or sell a security while the latter are deducted at regular intervals before earnings are distributed to you. In addition to the direct costs of buying a specific investment, other costs, including commissions, may be added on by your financial advisor or service provider.

Therefore, whenever you are thinking about making an investment, make sure you read the prospectus. Mutual funds, for example, will charge management fees to cover the ongoing costs of managing the fund, which are deducted from the fund’s earnings.  Keep in mind that a more expensive fund may, in fact, have the potential to generate greater returns so it’s not just the costs you have to keep in mind but also the fund’s strategy and assets it will invest in.

Investing with MeDirect

At MeDirect, our mission is to give clients the information and tools they need to grow their wealth with confidence and autonomy. For this reason, we adopt a fully transparent approach on fees and expenses when it comes to investing.  All our tariffs and charges for investment services are available here on our website. In addition, we have a detailed FAQ section on our website which has an entire section devoted to our investment services and a separate specific section on MeManaged, our digital discretionary portfolio management service. These FAQs provide all the necessary information and guidance on the how fees are applied. 

When using MeDirect’s mobile app or online banking platform to invest, you will also be given information on the transaction costs, fees and other expenses that apply for each security or instrument you purchase. This will help you decide if the investment you are looking at is the right one for you.

To further help you manage your costs when investing, MeDirect does not apply any custody fees or any charges to its Investment Cash Account, through which client investments are funded. Customers can also consolidate their assets with MeDirect at no cost, with a commitment to reimburse third-party transfer-out fees of up to 0.5 per cent of the total value of the securities.

For more information on MeDirect’s investment services, visit https://www.medirect.com.mt/invest/

MeDirect Bank (Malta) plc, company registration number C34125, is licensed by the MFSA to undertake investment services under the Investment Services Act (Cap.370).

Join MeDirect today to access the tools you need to put your money to work on your own terms.

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We strive to ensure a streamlined account opening process, via a structured and clear set of requirements and personalised assistance during the initial communication stages. If you are interested in opening a corporate account with MeDirect, please complete an Account Opening Information Questionnaire and send it to corporate@medirect.com.mt.

For a comprehensive list of documentation required to open a corporate account please contact us by email at corporate@medirect.com.mt or by phone on (+356) 2557 4444.