History

1981

• Hargreaves Lansdown formed by Peter Hargreaves and Stephen Lansdown to provide personal advice to clients on unit trusts and tax planning matters.
• First ‘Advertisement placed in the national press ‘Choosing a Unit Trust’. Our first investment newsletter, The Unit Investor was also sent to clients. This marked the beginnings of our direct, information-driven approach to helping clients choose their own investments.
• First issue of our client newsletter - the Unit Investor. The first newsletter highlighted two UK Equity Income funds. Henderson Income and Growth and Save and Prosper Income and Growth. Our fund choice has changed throughout the years as income fund managers have moved, come into form or gone off the boil. However, equity income has remained a recurring theme. The graph demonstrates why: With all income reinvested, £1,000 invested in the average UK Equity Income fund in July 1981 was worth £29,432 by October 2006. If the early investor has now retired and needs the income, they could opt to have income from the fund paid to them rather than continuing to reinvest it. This would generate about £1,000 a year - almost as much as the original investment.
  (Income payments vary, for a fuller explanation of how yields work, please visit our Guide to Fund prices, Savings and Yields in the knowledge section).

1982

• The Unit Investor focused on high yielding shares and equity income. With the UK emerging from recession and many companies yielding over 9%, it now makes interesting reading. Read a scanned extract from the Unit Investor of March 1982.

1984

Nigel Lawson's first budget upset the Life Assurance companies by abolishing life assurance premium relief. The Unit Investor predicted that income unit trust investors would be a major beneficiary of the Budget measures:

• Investment income surcharge abolished meaning that investors did not have to limit their investment income to £7,100 (or face 15% extra tax).
• Highest rate of stamp duty halved - reducing dealing costs for fund managers.
• Personal allowances increased in real terms.
• Corporation tax reduced in phases from 52% to 35% over next five years, leaving potential to increase yields.

1986

• Hargreaves Lansdown launched discretionary management service for clients who wished to hand over the selection and management of their unit trust portfolio.
• Financial Services Act introduced regulation and authorisation of investment businesses.
• Jitters - Chernobyl, Big Bang and the forthcoming General Election made 1986 a little jumpy.

1987

• Nigel Lawson introduced PEPs and in the same year, Hargreaves Lansdown introduced their own PEP.
• The summer months of 1987 witnessed a frenzy from clients eager to get into the stockmarket, a subsequent flurry of unit trust launches, each breaking all records to become the biggest ever launch. At this time, even estate agents were mailing unit trust application forms to their lists of property enquirers. This was our first experience of handling very high volumes of business.
• In October, the stockmarket crashed resulting in panic from private investors and fund management companies alike. Some fund managers simply switched off their telephones and refused to take client instructions – some brokers also stopped communicating with their clients.
• 'Unfortunately many investors will only wait until the market has recovered before committing funds and consequently miss out on a golden opportunity... I do believe that in five years time long term investors will be very happy with the returns they have received from their equity portfolios'. Our solution - the Phased Investment plan. Read a scanned extract from the Unit Investor of December 1987.

1988

• Hargreaves Lansdown kept in touch with clients, saw them consolidate their investments, recommend their friends and remain loyal during the subsequent recovery.

1989

• PEPs were given a boost in the Budget by the introduction of Unit Trust PEPs. Income unit trusts were again the main beneficiary.

1991

• Hargreaves Lansdown Stockbrokers was formed in 1991 in response to growing client demand for investment trusts. We pioneered private investor involvement in new investment trust issues by streamlining the application process.
• We subsequently became a leading Share Shop in government privatisations and other flotations, each of which expanded our client base significantly. Hargreaves Lansdown unified stockbroking and PEP administration operations to put in a significant PEP bid in the privatisations. The small print of the offer gave priority to PEP applicants and HL clients thereby benefited from superior allocation in the offer. For many this was the start of a long and happy relationship with PEPs.

1994

• HL Fund Managers was formed to provide a managed portfolio of investment trusts.

1995

• Unit trust commission structures began to change. As brokers discounted more and more of their intitial commission, fund management groups introduced annual renewal commission on unit trusts.
• Pensions Act 1995 reacted to the Maxwell scandal and introduced better governance requirements for occupational pension schemes. Turned out to be the first in a long series of statutes laying obligations on trustees of such schemes.

1996

• Hargreaves Lansdown went 'full discount', on Unit Trusts and OEICs for clients making their own investment decisions. The firm took the long term view to discount all initial commission. In future, we would where possible rely on 0.5% annual commision rather than 3% initial commission. This move benefited clients by getting their investments off to a head start. It firmly aligned the interests of the firm with the interests of the clients and ensured a stable long term income stream to continue servicing clients through stockmarket ups and downs.
• Hargreaves Lansdown joined forces with Bank of Scotland to offer preferential cash account facilities to clients.
• The PEP Discount Directory. An information revolution was needed so clients could check discounts and navigate the choice on offer. For the first time, the PEP discount directory pulled together performance, charges, commissions, yields, the discounts we offered and an explanation of how the discounts worked.
• Application form revolution. We introduced the prototype of a consolidated application form which could be accepted by different groups. Previously they had each only accepted their own application form and this caused huge inconvenience to investors. It took unit trust groups until 1999 to believe this was workable, yet was a key necessity for the fund supermarkets which followed later.

1997

• Gordon Brown removed tax credits for pension funds on UK company dividends.

1998

• The Thomson Travel flotation provided the group with invaluable insight into handling high volumes of business. The scramble for shares as the press mis-reported the closing date led to an unexpected last minute rush. We successfully handled almost 80,000 individual cheques and applications in the last four days of the offer. This proved useful in handling ISA volumes in the following years, as well as opening the door to over 20,000 new clients.

1999

• Hargreaves Lansdown Pensions Direct formed. Previously the average pension plan of £50 a month generated £400 commission to a salesperson. The company’s aim was to innovate and deliver transparent, good value pensions for private investors.
• December: Launch of online sharedealing service with the lowest cost dealing tariff of £9.95 gave early understanding of how clients want to use the internet..
• Launch of HL Corporate Solutions to provide independent expert pensions advice to companies..
• PEPs went out with a bang. February 1999 Ultimate PEP Discount Guide successfully used the consolidated application form devised back in 1996. New ISA fuelled the growing technology boom. Over their 12 year history PEPs had attracted 12.2m account holders and can still claim to be the most popular investment of all time. Hargreaves Lansdown had become a leading PEP discount broker. The market had seen a strong bull run following the crash of 1987 and the ISA widened the investment remit to include funds outside the UK and EU. This fuelled an already growing technology bubble (most technology funds invested in the USA).

2000

• Launch of Annuity Supermarket. For the first time, people could easily compare and shop around for the best annuity rate available.
• First issue of the Investment Times – a publication devoted purely to investment.
• Soaring ISA volumes challenged the investment industry as demand for technology investments seemed insatiable. Mark Dampier warned clients 'not to get too carried away with ‘one red hot theme' and not to commit too much of their portfolio to this area.
• The cult of the star fund manager arrived. By 2000 William Littlewood of Jupiter income had achieved the status of guru. When he left Jupiter, industry consensus was that investors should sell. Mark Dampier courted controversy by suggesting investors stay put with the new manager, Tony Nutt. Those who listened have since enjoyed a return of 96% compared to the sector average of 49% (28/4/00 to 26/9/06). The past is not necessarily a guide to future performance. This was the first in a long series of fund manager moves and formalised our fund research alert service.
• Equitable Life - unable to live up to the commitments it made to pension investors finally closed to new business. The impact on confidence in the pensions industry is still being felt.

2001

• Launch of the first fund in our Multi-Manager fund range – now called the HL Multi-Manager Balanced Managed Trust.
• Re-branded our Self Select PEP and ISA service as the HL Vantage service. Major systems development now enabled us to share renewal commission in addition to initial commission on funds. Our administration infrastructure and the information clients needed to navigate choice was already well established. The HL Vantage service quickly took a major share of the burgeoning fund supermarket business.
• Launch of stakeholder pensions. Simplified, low cost pensions which were available to a wider audience. But the application form was still 32 pages long. Our pensions experts reduced it legally to a simple 6 page document and HL quickly became the lead stakeholder pension broker.
• Terrorists outraged the world in September. Our message to investment clients was as follows:
  
  'Any chance that recession might have been averted has probably disappeared. Just as we saw events unfurl in the Gulf War ten years ago, visions of buildings crumbling will paralyse the American consumer. It is only the American consumer that has kept the world economy going. The security at airports, ports, stations and in public buildings will cause Americans to 'stay at home' the associated spending, clothes, restaurants etc must decline. The knock on effect will probably be worse than envisaged.
  
  Today investors could sensibly pursue the strategy of increasing liquidity in their portfolios – it doesn't seem wrong today to sell poor performing investments and look to real quality such as gilt edged stock or even hold cash pending a further possible shakeout in the aftermath of the World Trade Center disaster.'
  
  At the time of writing, the stockmarket stood at 5033.7, it bottomed out in at 3287 on 12 March 2003.
• Growth of HL Multi-Manager fund range. Clients increasingly wished to hand over their portfolios to professional management. HL Multi-Manager Special Situations Trust launched in December 2001 and HL Multi-Manager Income and Growth Trust in October 2002.
• Stephen Byers left Railtrack shareholders high and dry by forcing the company into receivership. Hargreaves Lansdown together with Fidelity joined an action group for investors and helped secure a small compensation.

2002

• Re-structured our discretionary services into a Portfolio Management Service.
• 'With stockmarkets in turmoil, property markets saturated, and life insurers under pressure, people thinking about their investments may feel they face Hobson's choice. However, one man's meat is another man's poison. Looked at another way, this could be the environment to create a golden age for active fund management'. An extract from July 2002 Investment Times. We might not have called the exact bottom of the bear market, but we were not far short. Read an extract from the Investment Times of July 2002.
• With investors reticent to invest new money during these years, they were happy to consolidate all their investments in the Vantage service in return for a share of the renewal commission and greater control over their assets. The number of accounts increased to include the ISA account, the PEP account, the Fund account and the Share account.
• Peter Hargreaves warned private investors to stop and exercise caution before investing any new money into With Profits Bonds. This courted controversy in the industry but has proved the correct call.
• Growth of online investing. As acceptance of the internet grew, we saw 10% of applications placed online for the William Hill Share Offer.

2003

• Launch of the HL Vantage SIPP account. For the first time, clients could bring their pension arrangements into the HL Vantage service and benefit from the low costs and initial discounts which ISA and PEP investors had been enjoying for over a decade. The HL Vantage service was the first fund direct supermarket to offer SIPPs.
• Our financial advisory division was restructured and relaunched in April 2003 as Hargreaves Lansdown Financial Practitioners. Highly qualified and experienced, nearly 90% of the practitioners have achieved advanced examinations in financial planning. Salaried and structured to ensure advice is fully objective, with quality of service part of remuneration package. Each specialises in selected areas of financial planning, so clients are always dealing with an expert.

2004

• Launch of HL Markets to provide sophisticated investors with access to Contracts for Difference. This was followed by FX trading later that year and Spread Betting in 2006.

2006

• Relaunch of Hargreaves Lansdown website with improved dealing and research facilities.
• Still the most nimble broker. There were just two weeks from announcement of the Qinetiq share offer to the first day of trading. Despite having grown as a company, Hargreaves Lansdown was still nimble enough to ensure private investor involvement. We offered the whole process online – with telephone helpdesk backup fom our offices in Bristol.
• Pensions A-Day. The most far-reaching simplification of Pensions seen to date. The HL Vantage SIPP was already in place for clients to take advantage of the new rules and they have - in their thousands. The HL Vantage SIPP has given pension investors the same level of choice and discounts as PEP investors. It remains to be seen whether the SIPP, introduced by Nigel Lawson back in 1987 might well overtake his other invention, the PEP in terms of popularity.
• Introduction of non-Executive directors to the Board of Hargreaves Lansdown PLC. Jonathan Bloomer and Mike Evans joined the Board as non-executives.

2007

• Hargreaves Lansdown floated on the stock market

  25% of shares in the company were made available to institutions, employees and existing clients. No new money was raised as part of the offer and 75% of the company continues to be owned by Peter Hargreaves, Stephen Lansdown, other directors and staff.

• HL Vantage SIPP has assets of over £1 billion for the first time. By the year end, that amount has reached £1.7 billion.
• HL Multi Manager team now manages over £1 billion in four funds. Lee Gardhouse and team continue to win industry accolades.

2008

• PEP and ISA accounts merge. Government promise to make ISAs a permanent feature of the UK saving industry.
• Sweeping changes to capital gains tax rules simplify tax returns and make funds more attractive.