How to Buy Shares Using A Trading Investment Platform

If you are looking to buy shares then a trading platform is a great way to do this.

What the right platform is for you will depend on your requirements.

Why a trading platform?

You don’t have to buy and sell shares using a share platform to manage your investments: you could be old-school and contact a stock broker directly to buy and sell investments.

This often involves lots of paperwork and waiting for the postman to send you paper statements which for some people may be perfectly adequate.

You will typically need to deal with a real person to make anything happen which can make this way of operating cumbersome and more expensive.

With advances in technology investors now have significant choice in how their money can be managed online.

Benefits of using a platform include:

  • Lower costs
  • Easy access to international markets
  • 24/7 access to your investments
  • You can hold all your tax efficient investments such as ISAs and SIPPs in one place:  including lifetime ISAs, right to buy ISAs and  junior ISAs
  • Plus any other fund holdings or shares that you’re trading outside of a tax-free environment, from a general trading account

How do you choose a trading platform?

The services offered by the different types of platforms vary widely, and so do the costs.

5 things to consider:

1. Do you already have an idea of the shares you want to trade in?

Not all investment platforms allow you to trade shares.

If your focus is on UK shares then most platforms will provide comprehensive access.

If you are looking to buy international shares check with the platform they can offer what you are looking for e.g. Some platforms focus just on US shares such as Stake.

2. Do you want to do a lot of trading?

Active investors will want to look for a platform that offers the lowest fees for volume trades.

If you are going to trade regularly most share trading platforms will offer lower trading prices based on volume.

Some platforms such as eToro do not charge when you trade, but there may be fees incurred if you do not trade within a 12 month period.

3. Types of trading account offered

Some trading platforms offer as well as general trading accounts, ISA accounts and Self Invested Personal Pension Accounts which offer tax free trading benefits (no tax on dividends or capital gains tax on realised profit). Trader accounts which offer ISA and SIPP accounts include Interactive Investor, AJ Bell, Hargreaves Lansdown and IG

4. Do you want to trade just in shares, funds, or shares and funds?

Some platforms don’t offer collective funds.

If you also interested in investing in collective funds then this again may determine who you go with. If you are interested in ETFs, Investment Trusts, Open Ended Investment Companies (OEICs) or Unit Trusts then you will need to check with the platform provider what is available. E.g. Some platforms only offer a limited number of collectives such as OEICs.

Charging structured for funds held on the platform will vary. Over time the impact of such charges can be significant. Check the platform charging structure carefully.

 5. How easy to use is this trading platform: what kind of tools and customer service does it offer?

How easy is the platform to use to buy and sell shares? Platform functionality is becoming the key battleground in persuading traders which platform to go for. Mobile app features are also key in offering traders alerts and buy/sell signals whilst on the move.

These are often the criteria that count most highly with users, so do some research and read the reviews.

Many investors are prepared to pay a bit more in fees  for a platform that offers really useful apps and services.

How do you buy shares using a trading platform

Our view:  The next generation of online trading platform means you can buy shares in as little as 10 minutes!
  1. Select a share platform – See below our 3 top platform picks
  2. Open your share account – To do this you will need your bank details and national insurance number
  3. Fund your account – You will need to fund your a/c with a debit or credit card or bank transfer
  4. Search for the ETF using the stock code – Type in the stock code into the search box
  5. Check out the latest info and price for the selected ETF – Some platforms offer free research and analysis
  6. Buy the ETF – Nice and easy!

See our 3 top picks for buying shares below:

Buy & Sell SharesHow to Buy Shares Using A Trading Investment Platform Fair Investment

Capital is at risk. 

  • 0% commission on stocks
  • Free account
  • Inactivity fee after 12 months

Go To Site »

 

 

Buy & Sell SharesHow to Buy Shares Using A Trading Investment Platform Fair Investment

Capital is at risk. 

  • 1 free trade per month
  • Fixed fee platform – £9.99 pm
  • No inactivity fees

Go To Site »

 

 

Buy & Sell SharesHow to Buy Shares Using A Trading Investment Platform Fair Investment

Capital is at risk. 

  • £2.95 per trade
  • Low cost platform
  • No inactivity fees

Go To Site »

 

 

Other Trading Platforms To Consider:

You can also review what other platforms have to offer below to UK traders.

Trade From
£8
0% commission on US shares
Frequent Trader Rate
£3
Platform Fees
£0 to £24 per quarter

Good to know: Pay zero commission on US share trades, and just £3 on UK share trades, when you trade three or more times a month with IG. No admin or transfer fees. Custody fee of £24 per quarter, charged if you hold share dealing or ISA assets at the end of the quarter.

 

Trade From
£9.95
Frequent Trader Rates
£4.95
Platform Fees
0.25% pa
Good to know: There is no charge to set up or transfer a share dealing account and no charge to pay money into the account. You can deal from as little as £1.50, and you will never pay more than £9.95 per online deal. Voted ‘Best Execution Only Broker 2020’  by ADVFN International Financial Awards.
 

Trade From
£11.95
Frequent Trader Rate
£5.95
Platform Fees
No fees for share dealing

Good to know: Online trading charges based on previous month’s activity. 20+ trades made in previous month is £5.95 a trade. 10-19 trades are £8.95 a trade. Less than 10 trades it’s £11.95. Get Access to live prices. Easy set up – Buy & sell shares in minutes!

 

If you’ve decided to switch platforms…

DON’T withdraw your money from your ISA, and then pay it into your new account. It all has to stay quarantined within an ISA “wrapper” to hold onto the tax advantages.

  • Instruct the platform you’ve chosen to move your funds over for you. (Get them working for their fees from Day One…) That way you’ll preserve their tax-free status.

No news, feature article or comment should be seen as a personal recommendation to invest. Prior to making any decision to invest, you should ensure that you are familiar with the risks associated with a particular plan. If you are at all unsure of the suitability of a particular product, both in respect of its objectives and its risk profile, you should seek independent financial advice.

Tax treatment of ISAs depends on your individual circumstances and is based on current law which may be subject to change in the future. ISA transfer charges may apply, please check with your provider.

Written by James Caldwell ,
14th January 2021