How To Buy UK Shares – 3 Top Trading Platform Picks
Buy UK shares in as little as 5 minutes!
The right platform for you will depend on your requirements:
- Why use a trading platform to buy UK shares?
- How do you pick a trading platform?
- How do you buy UK shares using a platform?
- 3 Top Picks for buying UK shares
How to buy UK shares using a trading platform
Our view: Advances in technology offer modern investors a range of advanced options for investing with tools and research features to make your decision making simpler. The next generation of online trading platform means you can set up and fund an account using a debit card in as little as 5 minutes!
- Select a share platform – See below our 3 top platform picks
- Open your trading account – To do this you will need your bank details and national insurance number
- Fund your account – You will need to fund your a/c with a debit or credit card or bank transfer
- Search for the share stock code – Type in the stock code into the search box
- Check latest info and prices for the selected share – Some platforms offer free research and analysis
- Buy the share – Nice and easy!
3 top picks for buying UK shares
Capital is at risk.
- 0% commission on stocks
- Free account
- Buy fractional shares
- Copy trading – follow successful traders
Buy & Sell UK Shares
- Buy & sell shares from £2.95
- Free account
- Get 100 FREE trades (when you open an a/c – T&Cs apply)
Buy & Sell UK Shares
- Buy & Sell UK Shares from £7.99
- Account fee of £9.99 pm (Covers you for mutiple accounts)
- 1 free trade pm
- Over 40,000 UK & global shares to choose from
Why use a trading platform to buy UK shares?
You could opt to use the old school route using a telephone stockbroker directly to buy and sell shares.
Your preference may be to deal with a real person to make things happen – whilst this has some merits it can be slow and cumbersome and potentially more expensive.
The good news is that with advances in technology, investors now have a wide range of options when buying UK and international shares.
Benefits of using a trading platform include:
- Lower trading costs
- Easy access to the UK and international stockmarkets
- 24/7 access to your investments
- You can buy shares in tax efficient wrappers such as ISAs and SIPPs in one place: including lifetime ISAs, right to buy ISAs and junior ISAs
How do you pick a trading platform?
Trading platform services offered vary widely, and so do the costs.
5 things to consider:
1. How do you want to buy & sell stocks online?
There are 2 ways to buy and sell stocks online
You can invest in stocks directly via a share dealing service or you can speculate on share prices using leveraged trading products.
a. Investing in shares
Share dealing services enables you to invest in company shares with a view to selling them for a profit at a later date. When you buy shares you become a part owner of that Company and gain shareholder rights including any income that is paid as dividends.
Different share dealing services have different charging structures. Some platforms offer commission free share dealing, but most operate on a fixed fee per trade with usually a reduction in this fee if you carry out more than a certain number of trades per month.
With profits you make on share trading capital gains and dividends earned may be subject to tax at your personal rate. Tax can be mitigated if you trade within an ISA or Self Invested Personal Pension account.
b. Shares Trading
With derivatives trading you can use products such as CFDs and spread bets to speculate on a share’s price increasing or decreasing without having to take direct ownership of the shares themselves.
CFDs (Contracts For Difference) and spread betting are leveraged products, which means you can gain full exposure to company shares while only putting down a small deposit. While this magnifies possible profits, it does the same for losses.
CFDs & spread bets are popular among short term traders as profits and losses are realised immediately – making it faster to open and close trades. However, this doesn’t mean you can’t use them for longer-term positions too. You’d just need to consider the costs involved in maintaining a position – such as overnight funding – and the bet duration as spread bets do have fixed terms.
They also enable you to buy and sell shares online without ever owning the underlying asset. This has tax benefits and means you can trade both rising and falling markets (Tax laws are subject to change).
2. Do you want to do a lot of trading?
Regular traders will want to look for a platform that offers the lowest fees for volume trades.
If you are going to trade UK shares regularly most trading platforms will offer lower trading prices based on volume.
Some platforms such as eToro do not charge commission when you trade, but there may be fees incurred if you do not trade within a 12 month period.
3. What types of trading account are 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).
4. Trading just UK shares, or funds as well?
If you also interested in investing or trading in 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. What features does the platform offer?
As well as costs it is important to consider additional features does the platform offer?
Platform functionality is becoming the key battleground in persuading traders which platform to select.
Mobile apps are also key in offering traders alerts and buy/sell signals whilst on the move.
What research tool are on offer?
What is the user experience like – it is worth looking at trader reviews.
Many investors are prepared to pay a bit more in fees for a platform that offers really useful apps and services.
Some platforms such as eToro offer customers the option of copying trades of successful traders. This can be an attractive for new traders where you don’t have to decide when to buy or sell.
For more info on what is copy trading and how does it work click here.
Also worth a closer look:
Buy & Sell UK Shares
- Buy & sell shares from £5.95 to £11.95
- No charge if you trade only shares
- No1 investment platform in UK for private investors
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.
The value of shares, ETFs and ETCs bought through a share dealing account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 67%-75% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit. All trading involves risk.
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.