Thanks to the internet, investing is now easier than ever. Online brokers have given regular people the tools to manage their investments like the pros and invest from anywhere in the world.
For many people, buying shares from companies is the simplest and most straightforward method of investing. We’ve put together a list of the best share dealing accounts in the UK to help you make a more informed choice. These accounts will let you buy and sell company shares at a low cost. Share dealing platforms also allow several other kinds of investing including bonds, trusts, and investment funds.
Also consider checking out our posts on:
With that out of the way, let’s dive in.
Rounding Up The 5 Best Share Dealing Platforms
Hargreaves Lansdown is one of the best and most well-known financial institutions in the country and was founded in 1981. Hargreaves Lansdown currently holds over £86 billion in client assets and allows share trading on over 20 international exchanges. Hargreaves Lansdown offers a wide range of investments in addition to shares, including bonds, trusts, ETFs, index funds, gifts, ISAs, SIPP accounts, and more. The company also offers a massive repository of stock research and analysis tools so you can learn while you invest.
As far as fees go, a Hargreaves Lansdown share dealing account has a 0.45% annual fee for accounts between £0-£250,000, and a 0.2% fee for accounts between £250,000-£1 million. Accounts that have more than £1 million invested do not have to pay annual account fees.
There is also an £11.95 per-trade deal that drops to only £5.95 if you made 20 or more share deals in the previous month.
Hargreaves Lansdown also provides 26 charting indicators for stock research and has a mobile app with slightly pared-down functionality. The stocks and shares trading is top-notch, and it makes sense how the broker has become so popular.
- Great investment selection
- Good research tools
- Educational library of resources
- Fees go down the more you invest
- Per deal fee is somewhat high
- Mobile app lacks some desktop features
IG offers a top-of-the-line share dealing account that allows investing in over 12,000 shares, funds, and investment trusts. With the IG platform, you get 0 commission fees on regular US shares and a small £3 fee per UK share, with a small foreign exchange fee of 0.5%. One of the best features about IG is that they give UK investors the ability to invest in US shares after hours while the market is closed. It takes less than 5 minutes to create an account with IG and you can get started trading foreign and domestic shares immediately.
IG has a relatively simple and cheap fee structure. Trading US shares is free and UK shares incur a £3 fee per trade if you make more than 3 trades in the prior month. That is nearly £8 lower than the platform fee at Hargreaves Lansdown, for example. Otherwise, UK shares trading is £8 per share.
IG also offers two ways to buy shares. You can either do it directly on their exchange or you can tell IG and they will find the shares you want at an affordable price from more than 20 providers.
- Great for trading US shares
- Low best rate for UK shares of £3 per deal
- Two ways to buy shares: exchange or quote
- Share dealing and Stocks and Shares ISAs available
- Need to pay base rate before getting best rates
- 0.5% currency conversion fee in addition to per-deal fees
Degiro is a great trading platform if you are looking for a low-cost method to buy and sell shares. Degiro only charges £1.75 + 0.014% per share trade with a max fee of £5. That is way below fees for many other share dealing platforms. The platform services more than 450,000 customers in over 18 countries. For US shares, Degiro charges £0.50 + USD 0.004% per share dealing with no maximum amount, and charges £2 + 0.118% for share trades in European markets.
Degiro also offers funds trading at £7.50 per trade plus a 0.10% fee for exchange-listed investment funds. The main downside to Degiro is that it offers pretty much no fundamental analysis or research on shares. So, if you want that extra information, the Degiro might not be a good choice. However, the incredibly low fees for share dealing make it attractive if you want a no-frills trading platform primarily for dealing with stocks.
- Extremely low fees for UK share trading
- Offers US and European shares
- No minimum deposit
- Low annual platform fee of 0.20%
- Fund costs can get very high for non-exchange-listed funds
- Very little research or fundamentals data
FinecoBank is a great resource for those who want to trade shares in multiple currency denominations. Fineco charges a flat rate of £2.95 per trade for shares and does not charge an annual platform fee. With FinecoBank, you can also invest in US shares at a rate of 3.95 USD and European shares at a rate of 3.95 EUR. Listed on the platform are thousands of international shares, foreign bonds, and ETFs, as well as more complex instruments like commodities, futures, and options.
One of the best features of FinecoBank is the simple fee structure. You pay a flat fee for any kind of trade, which makes the platform very cheap for foreign investments. They currently charge a 0.25% custody fee for investing in funds, but this rate goes down the more that you invest.
- Very low flat fee for all trades
- Low custody fees for funds
- Multi-currency wallet options
- US and European stocks available
- Interface leaves a bit to be desired
- Listings might be limited compared to some platforms
Interactive Investor offers a simplified and straightforward platform for dealing shares that is a good fit for novices and experienced investors. In addition to shares, Interactive Investor offers a wide range of shares, funds, ETFs, and investment trusts, among other asset classes. Interactive Investor also has a neat feature that shows the latest Initial Public Offerings (IPOs) for new startup companies. To date, the company holds over £36 billion in client assets and serves over 300,000 customers.
One of the best features of Interactive Investor is its stock screener tool. The stock screening tool lets you quickly sort through shares, funds, trusts, and more based on sectors, industries, and other data like market cap, dividend yields, P/E ratios, and more. The screener tools are built on with the Technical insights tool that allows for 100s of technical indicators on charts.
Interactive Investor has no minimum deposit and has 3 plans
- Investor – £9.99 per month
- Funds – 13.99
- Super Investor – £19.99 per month
The Investor plan comes with 1 free trade per month and a flat £7.99 fee for UK trades. The Funds and Super Investor plan have 2 free trades per month and charge £7.99 per trade and £3.99 per trade, respectively. The Super Investor plan also offers US trades at £4.99 per deal.
- Great screening and technical tools
- Straightforward fee structure
- Customize your plan
- Good customer service
- Fees are moderately high
- Mobile app is a bit dodgy sometimes
What is a Share Dealing Account?
Share dealing is a type of investing that involves buying and selling individual units of stock of a company. Individual units of stocks are called shares and each share represents a portion of the company’s total value. Those who own shares are called shareholders and they are entitled to a portion of the earnings that the company generates. In other words, shares represent a portion of ownership in a company.
People make money from shares in two ways:
- Price movements. As a company’s shares become more desirable, people will pay more for them and the price of each individual share goes up. Investors will buy shares of a company, wait until the price of those shares rises, then sell those shares for a profit.
- Dividends. As part owners of the company, shareholders also get a portion of company profits given back in the form of dividends. Dividends can be taken directly or reinvested to purchase more shares.
Share dealing platforms, also called brokerage firms, are organisations that let you open an account so you can buy and sell shares. Share dealing platforms give you a way to search available company shares to buy and sell. Once you make an account and connect a payment method, you can search for the shares you want and buy them.
In the UK, share dealing is heavily regulated by the Financial Conduct Authority (FCA). As such, any share dealing platform that you pick needs to comply with FCA regulations surrounding buying and selling shares.
In other words, the top share dealing accounts give you direct access to shares on the stock market. With a share account, you can trade shares, exchange-traded funds, and more.
Pros and Cons of Share Dealing
- Good Returns. Out of the major investment asset classes, shares have the best potential for future returns. As companies grow and expand, the share prices will rise. That means that when economic growth is good, shares can explode in value and generate a lot of returns.
- Beat inflation. Shares are also the best investment to hedge against inflation. Since stocks typically experience high growth, most gains you get will outstrip any rise in prices due to inflation. Historical data pins the average stock market return at 10% over the past 100 years.
- High liquidity. Unlike some kinds of assets like property or real assets, shares are highly liquid, meaning they can be converted into cash very easily. This means that bid and ask prices are close, so you do not lose money to the spread when buying shares.
- Dividends. In addition to appreciating in value, shares also produce dividends, which are dispersed as cash payments to shareholders. Dividends can be taken as a cash payment or reinvested into shares.
- Voting rights. Generally speaking, share ownership comes with the right to vote on the structure of the company board of directors.
- Prices can drop. Just as the share price can rise very high, it can also drop and you can lose money. For example, if you invest £1,000 at £10 a share then the price drops to £8 per share, then your total investment is now only worth £800; you’ve lost money.
- Low preference ranking. When it comes to distributing out company earnings, common stockholders are last in line. Bondholders and preferred stockholders get paid first, then common stockholders get the remainder.
- Time horizon. While some stocks can make money very quickly, most investors prefer a buy-and-hold approach for long-time horizons. Investing also takes time in the form of research and analysis.
- High emotions. Stocks can change in price by the second, which can be very emotional and anxiety-inducing. Many people get scared and frustrated when stock prices start to rapidly change and they may rashly buy or sell.
Trading shares is probably the simplest and most straightforward way to get into investing. A trading account will teach you the basics of how markets and price movements work, and they can provide good deals on shares for experienced investors.
The best share dealing platforms allow trading with multiple asset classes and charge low fees on accounts and deals. Most included investment platform offers different types of investment accounts like SIPP accounts and stocks and shares ISA. So, most share dealing platforms will allow different kinds of investing.
One thing to keep in mind when trading stocks and shares with share dealing accounts is to seek independent financial advice when you need help. A financial adviser can help you navigate trading platforms.
When it comes to choosing the right share dealing platform, it depends on your investment goals and the strategies you favour. Online trading accounts for stock trading have relatively low trading fees. So, if you are ready to get into investing, then consider getting a share dealing account today.
- 7 Foolproof Ways To Hedge Against UK Inflation - June 3, 2021
- Interactive Investor UK Review (Is It Right For You?) - June 3, 2021
- Fidelity International Review (Better Than Hargreaves Lansdown?) - June 2, 2021