Frequently asked questions
Welcome to Gear Investments. Your are now a member of our community.
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- Who we are?
Gear Investments (UK) Ltd is an automated Investment Management Service regulated by the Financial Conduct Authority (FCA). Our team has many years of experience in the financial, wealth and technology sectors.
- Why did we decide to create Gear Investments?
We believe that achieving your financial goals should not be hard, time-consuming or expensive. With this in mind, we created Gear to give everybody the opportunity to invest, not only the wealthy
- How is Gear Investments different from other Services?
Our online platform automates the entire investment process using technology to improve efficiency and reduce costs.
- How does Gear Investment work?
Using the Gear platform, we find out about you, build the portfolio on your behalf and keep you updated on how your portfolio is performing through our simple and secure online interface (available 24/7).
- Are we regulated by the Financial Conduct Authority?
Yes, Gear Investments (UK) Ltd is authorised and regulated by the Financial Conduct Authority (FCA) to conduct designated investment business. Authorisation number 707467.
- How do I start?
To get started, click ‘Sign Up’ and answer the profile questionnaire to get an initial sample portfolio and investment strategy. As a virtual user, you can continue to monitor your virtual portfolio and its performance. For you to invest in a portfolio, you will need to become a verified customer (which is coming soon!).
- What security measures does Gear Investments use?
We have included stringent security measures within our platform with the aim of keeping your data and investments safe. These measures include full SSL encryption, secure data storage, an extra secure operating process with a two-step verification code.
- What is the minimum investment?
The minimum investment is £3,000. We aim to offer truly diversified portfolios using a basket of ETF’s. Investing a smaller amount may result in a portfolio which is overly exposed to a particular asset class, making it incompatible with your investment goals.
- How much does it cost?
Gear’s management fee is a yearly percentage figure and is based on the amount you invest. For example, if you invested £10,000 your fee rate would be 0.95%. If your account maintained a consistent value of £10,000 for the year, the total fee (including VAT) would cost you £95, spread over 12 months the deductions come to approximately £7.92. The fees are calculated on a daily basis as a percentage of your total assets under management. As you put money in, take money out during the month and as the value of your investments fluctuate, so to will the daily calculation of fees. At the end of the month, the fees accrued for that month will be deducted from your account automatically. Your portfolio value and the value of any fund you have opened is shown with the management fee deducted, including VAT and accrued to the most recent date. Because the daily value is shown after deduction of the accrued fees from that month, your daily value will be slightly lower than that shown in your investment activity. This is because the fee is only deducted at the end of the month.
- Where is my money held?
Like most investment managers, we believe that the safest way of looking after your investments is to appoint “Custodian Banks”, which hold your money and the investments we buy on your behalf. Saxo Bank serves thousands of investment managers, high-net-worth individuals and major Banks worldwide. In the event that Saxo Bank is unable to meet its obligations, this will not in itself entitle you to compensation from the Financial Services Compensation Scheme (FSCS). You should be aware that whether you are eligible to make a claim under the FSCS will depend on various factors and that there are limits to the amount of compensation the FSCS will pay. Entitlements would depend on the type of business and the circumstances of the claim. Most types of investment business are covered for £50,000 per person per regulated firm. You can get more information about compensation arrangements from the FSCS – http://www.fscs.org.uk/
- How can I close my Gear Investment account?
You can close your account at any time. To close your account, please email firstname.lastname@example.org requesting your account to be closed.
- Do I receive all my money back when I close my Gear Investment account?
Yes, if you have an active portfolio with Gear, you will receive all of your money after your portfolio has been liquidated and any fees deducted.
- What would it happen if Gear Investments closed?
Your investments and any uninvested cash are protected in the unlikely event that Gear are declared insolvent. If this were to happen, your account would likely be re-assigned to another financial institution and you would be kept informed.
- How can I contact Gear Investments?
You can e-mail us at email@example.com
- Do you have any more questions?
Your questions are welcome! Please email your questions to firstname.lastname@example.org
- Why do I have to fill in a risk profile test?
We wish to have a robust process for assessing the risk you are willing and able to take to ensure we place you in a suitable portfolio and also, we need to verify your identity and the source of your wealth to help avoid any involvement in financial crime, such as money laundering..
- How do I view my investment statements?
Investment statements can be viewed on the platform in the Activity section or in your tailored email summary provided each fortnight.
- On what devices does Gear work?
Gear works on any desktop, laptop, tablet or smartphone device. We are also developing native applications for iOS and Android.
- How do I view my portfolio holdings?
Portfolio holdings can be viewed on the platform in the Holdings section. Gear is committed to transparency and shows you all of the investment products which make up your portfolio.
- What information do I see in my investment summary?
The investment Summary section shows the current position of your portfolio (it is updated daily). Login daily to understand the performance of your portfolio and evolution of your strategy.
- How do I track my account activity?
Go to the Activity section which records and lists all of the activity in your account such as your investments, withdrawals and reports of rebalancing.
- How often do I receive a report with a summary of my portfolio’s performance?
You will receive a fortnightly email report outlining the performance of your portfolio and any changes in your investment strategy.
- Why does Gear Investments show historical performance?
The past performance of an asset or index. We review historical returns when trying to predict future returns, or to estimate how an investment may perform over a specified time or during a period of extreme market volatility. Past Performance is no guarantee of future results, and any expected returns or hypothetical projections may not reflect the actual future performance. There is no guarantee that the investment mix or any projected or actual performance shown will result in the expected outcomes shown. All investments involve risk, and you may lose money.
- What is slippage?
Slippage is the price differential from the moment when you initiate a buy or sell order through Gear to the moment the trade is executed on the market. It is slippage that may explain the (minor) difference in your portfolio allocation and remaining cash balance in your investment portfolio.
- Why could there be cash left in my Gear Investments account?
There may be cash left in your Gear account because the amount that you transferred into it did not align with the investment required to implement your investment strategy and achieve your portfolio (i.e. based on the price of all ETF shares in your strategy). For example, if you decided to invest £10,000.00 in a strategy, but the price of all the shares required to implement it was £9,772.00, there would be £228.00 remaining in your Gear account as you can only buy full shares in the same proportion to achieve the risk/return profile of the strategy. This amount is not refunded because it will be used in rebalancing events to achieve your optimum investment allocation.
Stock and Share ISAs
- What is an ISA?
ISAs (Individual Savings Account). ISAs were introduced by the government in 1999 to encourage people to save more for the future. Any investments you hold within an ISA are free from Capital Gains Tax when you sell them, and there is no Income Tax to pay on the interest or dividend income within your ISA. You don’t even need to declare the gains or income on your tax return.
- Am I eligible for a Stocks and Shares ISA?
You must be over 18, resident in the United Kingdom for tax purposes or, if not so resident, either perform duties which, by virtue of Section 28 of Income Tax (Earnings & Pensions) Act 2003 (Crown employees serving overseas), are treated as being performed in the United Kingdom, or are married to, or in a civil partnership with, a person who performs such duties and have not subscribed to another Stocks & Shares ISA in the same tax year. Gear Investments only offer Investment ISAs.
- Am I locked in?
No, while investing is a long-term proposition, you can withdraw your money whenever you like, and there is no minimum investment period.
- How do I set up an ISA Account?
One of the first questions you will be asked is whether you would like to open an ISA Account or a General Investment Account. You can contribute up to £20,000 to an ISA. You can also set up two plans, one to invest your ISA allowance (to take advantage of your tax-free savings) and another to invest any additional funds you may have. There is no additional cost for having two or more Accounts. Under the current rules you can only open one Cash ISA and one Investment ISA each tax year, so you need to check you have not opened any other ISAs this year, before you open you Investment ISA Account with us.
- What is the annual ISA allowance and how much can I invest?
The Government sets the annual ISA allowance (ISA limit) on how much you can invest in an ISA each tax year. This year (6 April 2016 to 5 April 2017), your ISA allowance is £20,000, and the full amount can be invested in a Cash ISA or a Stocks & Shares ISA (or any combination of the two). If you wanted to, you could invest £3,500 in a Cash ISA and £16,500 in a Stocks & Shares ISA. Or do it the other way around. The only rule is that, combined, your tax-free ISA savings in the tax year does not exceed £20,000. Any unused ISA allowances don’t roll over to the next tax year if you don’t invest the full amount, so it’s a case of ‘use it or lose it’. However, your ISA itself is ongoing and doesn’t end when the tax year does, which means that you can keep adding to it every year. You can transfer all of the money from your existing ISAs with savings from previous tax years including the full annual allowance for the current tax year.
- Can I have more than one ISA with Gear Investments in the same tax year?
No, Gear Investments only offer Investment ISA Accounts, you can only hold one Cash ISA Account and one Investment ISA Account per year. You can put your full annual ISA allowance in either a Cash ISA or an Investment ISA, or you can split it between the two in any combination you like.
- Are Gear Investments’ ISA plans treated any differently to Gear Investments’ General Investment Account plans?
Yes, ISA accounts offer you several tax-free benefits when compared to our General Investment Account. With an ISA you won’t pay any capital gains tax or income tax on your profits. With an ISA plan, you can currently pay in an amount of £20,000 while our General Investment Accounts allow you to pay in any amount, but you will pay tax on the interest you earn. It’s important to remember that ISA accounts are based on current tax rules which are subject to change.
- Can I transfer my existing ISAs to Gear Investments and what are the costs?
Yes, it is possible to transfer your previous years’ Investment ISAs or Cash ISAs from other providers to your Gear Investments ISA. Transferring your ISAs will not affect your current allowance, so you can still invest up to £20,000 this tax year. You should always use our transfer form. Never withdraw the money yourself to pay in, as you will lose your tax-free benefits on that money forever. Apply for your Gear Investments ISA first, we will then ask you to complete our ISA transfer form and to return it to our ISA Transfer Team. If you wish to transfer an existing ISA into Gear Investments, please get in touch, and we will arrange this for you. Please note Gear Investments will not charge you a fee to accept your ISA account. However, your current provider may levy an exit charge.
- Can I transfer my Gear Investments Stocks and Shares ISA to another provider and what are the costs?
Yes, you can transfer your Gear Investments Stocks & Shares ISA to either a Stocks & Shares ISA or a Cash ISA with a different provider. Should you wish to transfer the money you have invested in your Gear Investments ISA in the current tax year, we would require a completed Transfer Form from your new provider. HMRC rules state you must transfer all of it, whereas previous years’ ISAs can be transferred in whole or in part. You should check with your new ISA provider for any restrictions or charges they may apply to transferring ISAs. There is a transfer out fee of EUR 50 per ISIN, with a maximum charge of EUR 160.
- What is the difference between a Stocks & Shares ISA and an Investment ISA?
Nothing, they are different names for tax-free investments.
- Is there a minimum account size?
Yes, there is a minimum investment of £3,000. Because the cost of individual investments can be costly, the investment of smaller amounts could result in your portfolio being overly exposed to a singular asset class, meaning that this may not be consistent with your investment goals. You can contribute additional monies as and when you like.
- Can I replace an ISA subscription that I withdraw from the plan?
No, while you can take money out of your ISA whenever you want. Only to the extent of the annual limit, e.g. if you make a subscription of £11,000 in May and withdraw this sum in August, you can only pay in a further £9,000 in total before the 5th of April the following year, as you would then have reached the annual limit of £20,000. From 6th April 2015, you can take money out of a Cash ISA and put it back in without losing that part of your allowance, and you can put it back, provided it is within the same tax year. But this does not apply to Stocks & Shares ISAs.
- How do I invest?
To invest a lump sum in the ISA, please return your duly completed application form to us with electronic payment. To transfer an existing ISA, please return an ISA transfer form to us, duly completed.
- Can I change the investments I hold within my Saxo ISA?
Investments can be changed within a ISA but you will need to be aware of the charges made by Saxo Capital Markets or your Introducing Broker/Investment Adviser. Full details of how SCML administers investments and the charges applicable are provided in the Terms and Conditions and the Supplementary Charging Schedule which can be found on the Saxo website.
- Can I cancel my investment?
You can cancel your initial investment within 14 days and withdraw from your Saxo ISA. If you cancel your initial investment and it has fallen in value, you will not receive the amount you initially invested. For more details about withdrawing from your investment please see the Terms and Conditions.
- How will I know how my investment is performing?
You will be able to access your Account directly via your online login with Gear Investments.
- What tax will I pay?
Within the Stocks and Shares ISA there is no capital gains tax to pay on any gains and no further tax on the income. You do not need to mention ISA investments on your UK tax return. You cannot reclaim the tax credit on dividend distributions. The appropriateness and value of any tax relief provided by a ISA will depend on your individual circumstances. If you are not UK resident, your ISA may be subject to tax in your country of residence.
- How do I close my account or withdraw cash and how much will I receive?
To close your account, please write to us. Electronic payments can be sent directly to your bank account but we cannot tell you at this stage what you will receive because that depends on factors such as how your investments perform. If you want to transfer your investments to another manager, please contact them and ask them to arrange the transfer with us.
- What happens to my investments when I die?
If you hold investments with us when you die your investments are not necessarily sold. We follow the instructions that your Executors give us.
- What advantages do I have investing through Gear Investments?
Gear simplifies the investment process. Gear actively manages your investment strategy and portfolio allocation so you don’t need to follow the market or modify your strategy based on changing market conditions. Gear provides its automated investment service with low fees. Customers have the flexibility to add and withdraw funds without penalties and receive regular email reports on how their portfolio is performing.
- What am I investing in?
We construct portfolios on your behalf using exchange traded funds (ETFs). ETFs provide an easy way to gain exposure to a pool of investments without having to buy each one individually. ETFs traditionally have a lower annual management charge than other collective investment vehicles, such as unit trusts, investment trusts and open-ended investment companies.
- How are the ETFs selected for each portfolio?
Our investment team are specialists in investment research and have reviewed thousands of ETFs with leading financial analysis technologies. In selecting these ETFs, they use a quantitative analysis methodology and take into account factors such as historical and recent performance, volatility and liquidity, as well as more complex details as Value at Risk, Sharpe ratio, and alpha and beta returns.
- What kind of investment products do you use to build the portfolios?
We use Exchange Trading Funds, broadly known by their initials ETFs. ETFs have several advantages such as lower costs, transparency, ease of trading and tax efficiency.
- Do you invest in equity securities?
Not directly and only indirectly through ETFs. Equity securities may comprise the underlying securities within some ETFs in your portfolio, however, compared to ETFs stocks have higher transactional costs, are usually more volatile and have fewer tax advantages. That is, we utilise ETFs as a vehicle to invest in equity securities as a preferable model to investing into the stocks themselves.
- Can I invest by myself into securities through Gear?
No, you cannot invest directly in the markets. Gear designs the investment strategy, portfolio and asset allocation through ETF investment products that you invest into.
- Is there any commercial influence by ETF providers to include their products in Gear Investments’ strategies?
No, we offer unbiased financial products. The ETFs that compose every strategy are selected based entirely on independent quantitative criteria. We do not receive any commission from the ETF providers to promote their products in our strategies.
- Why do we rebalance your portfolios?
Markets change continuously and asset returns fluctuate accordingly. Portfolios are rebalanced to ensure the diversification and asset allocation achieves the investment strategy based on the current market conditions. Gear’s managers monitor the market, review the strategies with our financial analysis tools and buy and sell the investment products accordingly for the benefit of customers to preserve capital and maximise returns.
- Can I change my username?
No, you have to register with your real name.
- Can I change my profile data?
You can edit and update your data in Profile section.
- How can I change my password?
Navigate to the Profile section where you will be able to change your password (note you will receive an email reporting the password change).
- How can I change my bank account?
Email email@example.com and we will contact you on how to change your bank account details.
- How do i log out of the mobile app?
Click on the ‘Log Out’ button in the upper corner of your mobile screen.
- How do I unsubscribe from reports?
You have two options: unchecking the subscription in the Profile section or by clicking the ‘Unsubscribe’ link at the bottom of the email report.
- What are the main investment asset classes?
The main investment asset classes include money market, fixed interest, equities and alternatives.
- What is active management?
Active management involves the investment manager actively determining the investment strategy, asset allocation and the investment products with the aim of maximising performance. Passive management involves the compilation of assets to achieve a particular objective or to track an index without any ongoing active management.
- What is an ETF?
ETF are the initials for Exchange Traded Fund. The securities of these funds are listed on a recognised stock exchange and are represented as shares, however, with the structure of a fund. As a fund, ETFs track other assets such as shares, bonds, commodities or indexes according to the ETF strategy and underlying securities. However, as a listed fund, the ETF share price changes according to the performance of the underlying securities and the market conditions. ETFs have many advantages including diversification to reduce risks, transparency, liquidity, lower fees and more tax efficiency.
- What is rebalancing?
Markets and ETF values change according to the performance of the underlying securities and general market conditions. Rebalancing of a portfolio involves modifying the asset class and investment product mix (i.e. ETF mix) to ensure the portfolio aligns with the investment strategy based on the actual market conditions and performance of ETFs. That is, when you rebalance your portfolio, you are changing the allocation of your assets that may involve buying or selling existing or new ETFs to ensure your portfolio is aligned to your strategy and to improve your performance.
- What is a portfolio?
A portfolio is a group of securities (such as shares, bonds, funds or ETFs, amongst others) to achieve an investment strategy through diversification of investments to manage risk, achieve performance objectives and preserve capital.
- What is quantitative analysis?
Quantitative analysis or quant analysis is a methodology to analyse an asset value using mathematical and statistical tools. It uses algorithms and focuses on risk analysis. The combination of multiple ratios and figures are used as the basis to obtain trending patterns as the possible evolution of performance for the security.
- What is technical analysis?
Technical analysis is a technique to analyse assets based on the evolution of markets. At a foundation level, technical analysis is a security analysis methodology for forecasting the direction of prices through the study of past market data, primarily price and volume.
- What is liquidity for assets?
Liquidity is the volume of trading in an asset and describes the degree to which an asset or security can be bought or sold in the market without affecting the asset’s price. Some assets and securities are more liquid then others typically those that have high trading volumes.
- What is performance?
It is the result or return of your investment in a period. It can be positive or negative.
- What kind of assets do I find in the financial markets?
There are many assets that can be traded in modern financial markets. The major asset classes include: Shares: shares represent the equity capital security of a company with the price determined by market forces and company performance. Bonds: bonds represent the debt security of a company when the company has been lent money with a period of maturity and a requirement to pay a fixed or variable interest to the lender. Generally, the higher the interest rate of the bond the higher the risk is to the lender for a default event. Commodities: Commodities include gold, wheat, oil and other products that comprise goods that are basically indistinguishable across global markets. Mutual funds: Mutual funds are investment vehicles that create a portfolio of different securities to achieve a certain asset exposure and risk profile. ETF: Exchange Traded Funds (ETFs) are similar to mutual funds, however, they are traded on an exchange with the price of the ETF securities subject to market forces and the performance of the underlying securities