Efficient way to purchase shares
Discussion
I'd like to take a percentage of my salary each month (say 10%) and use this to purchase shares. I'm not likely to be buying and selling on a daily basis and I'm more interested in building a portfolio over time than trying to day trade. This is going to be more low £100s than £1000s per month.
I am happy to take a punt on choosing the companies to invest in (no guidance required - doing this somewhat as a educated flutter for sport).
What is the most efficient way to purchase and sell shares in this situation? Ideally online or without having to deal with a broker over the telephone?
Many thanks in advance.
I am happy to take a punt on choosing the companies to invest in (no guidance required - doing this somewhat as a educated flutter for sport).
What is the most efficient way to purchase and sell shares in this situation? Ideally online or without having to deal with a broker over the telephone?
Many thanks in advance.
Well Trading 212 seems to be a popular answer to your question:
https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
Thanks for this.
I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
Mr Pointy said:
Well Trading 212 seems to be a popular answer to your question:
https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
'loaning' them your shares,which are then rented out,to short sellers to be used as a tool to lower SP so in effect it's costing you more than any fee?https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
https://www.google.com/url?sa=t&source=web&...
Edited by TCX on Saturday 27th March 12:04
TCX said:
Mr Pointy said:
Well Trading 212 seems to be a popular answer to your question:
https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
'loaning' them your shares,which are then rented out,to short sellers to be used as a tool to lower SP so in effect it's costing you more than any fee?https://www.trading212.com/en
Of course you might want to ask yourself if there's no fees & no commission how are they making any money to run the business, let alone make any profit.
https://www.google.com/url?sa=t&source=web&...
Edited by TCX on Saturday 27th March 12:04
There's a huge range of choice from micro brokers upwards. But you need to know what it is you want to be investing in before you can start looking for a broker to fit. They all tailor their service to different ends of the customer and share market. And today you have to navigate the new style of 'comm free' broker who are obviously still charging a commission but are hiding what that is from the customer.
For example, it's always worth asking why a high quality CEO, with a good track record would suddenly bail from a Bulgarian bookmaker that had expanded massively into the micro account market in recent years?
https://fxnewsgroup.com/forex-news/executives/trad...
But you need to work out first what you're going to be buying each month before looking for a broker. Is it penny shares, US stocks, UK blue chips, funds, trackers etc. Then what sort of clip size, £50, £100, £500.
Do you then wish to trade at real market prices or 'house' prices? Do you want your stock put out to lend? Do you want to know what you'll actually be paying in fees? What is the FX policy for overseas transactions.
And if you're actually a real investor rather than a punter the most important question is how do you exit that broker? As an investor you'll have an investment horizon that will out last any of the discount firms and many of the discount firms will change their charging structure as they reach critical market share points so before you send them any money you need to know how they will process your inevitable departure to a competitor.
No one ever bothers to find out how to leave before they join but it's one of the critical bits of information. For example, in order to try and stop customers from leaving some brokers will not transfer holdings to a competitor but force their client to close all positions and subsequently incur tax risk, two sets of broker fees, the full market spread cost and time out of market risk.
There are also things to consider such as whether 'helpdesks' staffed by offshore kids who know absolutely nothing is going to be an issue.
But primarily you need to know what you want to be buying first and then the first question to ask of the brokers in your subsequent shortlist is how do you leave.
For example, it's always worth asking why a high quality CEO, with a good track record would suddenly bail from a Bulgarian bookmaker that had expanded massively into the micro account market in recent years?
https://fxnewsgroup.com/forex-news/executives/trad...
But you need to work out first what you're going to be buying each month before looking for a broker. Is it penny shares, US stocks, UK blue chips, funds, trackers etc. Then what sort of clip size, £50, £100, £500.
Do you then wish to trade at real market prices or 'house' prices? Do you want your stock put out to lend? Do you want to know what you'll actually be paying in fees? What is the FX policy for overseas transactions.
And if you're actually a real investor rather than a punter the most important question is how do you exit that broker? As an investor you'll have an investment horizon that will out last any of the discount firms and many of the discount firms will change their charging structure as they reach critical market share points so before you send them any money you need to know how they will process your inevitable departure to a competitor.
No one ever bothers to find out how to leave before they join but it's one of the critical bits of information. For example, in order to try and stop customers from leaving some brokers will not transfer holdings to a competitor but force their client to close all positions and subsequently incur tax risk, two sets of broker fees, the full market spread cost and time out of market risk.
There are also things to consider such as whether 'helpdesks' staffed by offshore kids who know absolutely nothing is going to be an issue.
But primarily you need to know what you want to be buying first and then the first question to ask of the brokers in your subsequent shortlist is how do you leave.
pistonheadforum said:
Thanks for this.
I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
Just go with a well known broker and you'll be fine. Its a bit like worrying if your bank really have your money.I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
pistonheadforum said:
Thanks for this.
I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
Yes they email you after every transaction. I guess with these kind of things the worry is that how do I know the shares are owned by me! Is there paperwork that must come through after each transaction or some kind of receipt that completes the purchase?
I'd hate to be merilly purchasing shares online only to find out later I'm not the actual owner and the cash has been going down the pan.
Thanks in advance.
DonkeyApple said:
There's a huge range of choice from micro brokers upwards. But you need to know what it is you want to be investing in before you can start looking for a broker to fit. They all tailor their service to different ends of the customer and share market. And today you have to navigate the new style of 'comm free' broker who are obviously still charging a commission but are hiding what that is from the customer.
Thank you for taking the time to provide such a complete answer.I guess I am looking for recommendations on what companies/brokers to use.
I am looking to purchase roughly £100-200 per month and this would be UK shares (mixture of penny shares in companies I think are down on their luck but might bounce back, FTSE stalwards that I think are mispriced) and also foreign companies as well. Supect that over time the bulk would be non UK shares.
I am not looking to "rent" these out or sell on short term and would largely do nothing with them until deciding to cash them in. Whilst it would be good to respond quickly to the market and sell, I am more likely to hold them for at least 6 months at an absolute minimum (more likely longer term than that).
Is there a particular broker that people can recommend?
Many thanks in advance.
Generally any broker with several years history is very unlikely to be fraudulent.
There's an element of you get what you pay for with regard to service (such as how quickly the phones are answered if you have a query), but it is also important to understand the charging structure a particular broker uses - it is usually some combination transaction charge, a fixed monthly fee or a % charge on the size of your account, and depending on account size and your trading behaviour, some are better value than others.
There's a list here:https://monevator.com/compare-uk-cheapest-online-brokers/ with considerable associated discussion that might be worth reviewing, and posting if you've got a specific query
There's an element of you get what you pay for with regard to service (such as how quickly the phones are answered if you have a query), but it is also important to understand the charging structure a particular broker uses - it is usually some combination transaction charge, a fixed monthly fee or a % charge on the size of your account, and depending on account size and your trading behaviour, some are better value than others.
There's a list here:https://monevator.com/compare-uk-cheapest-online-brokers/ with considerable associated discussion that might be worth reviewing, and posting if you've got a specific query
I have used iwebsharedealing for about 20yrs.
£5 per transaction (and it has been that for all that time!).
Owned by Natwest I believe. Can hold in an ISA wrapper or outside.
Quite good tools for automatic trading.
I would recommend them.
If you are investing <£20k/ year and do not hold an ISA then invest in an ISA wrapper for there will be no CGT or other taxes. If 10% of your salary is >£20k then you probably already have good advice.
£5 per transaction (and it has been that for all that time!).
Owned by Natwest I believe. Can hold in an ISA wrapper or outside.
Quite good tools for automatic trading.
I would recommend them.
If you are investing <£20k/ year and do not hold an ISA then invest in an ISA wrapper for there will be no CGT or other taxes. If 10% of your salary is >£20k then you probably already have good advice.
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