Best Investment Apps UK 2022 – Forbes Advisor UK – Forbes | Hot Mobile Press

Until recently, the idea of ​​managing stocks and shares from your mobile device – practically having a trading room in your pocket – seemed fanciful.

But today’s smartphones are making this a reality. Private investors are increasingly using trading apps not only to carry out individual transactions, but to manage entire portfolios.

Whether you’re buying stocks for the first time or you’re a seasoned stock market investor, here’s a look at the rise of trading apps and how to choose one that suits your needs.

Remember, investing is speculative and as an investor, your capital is at risk. This means you may lose some or all of your money.

Which trading app should I choose?

Keeping the amount you pay to trade and invest to a minimum will increase the returns on your underlying investments.

But like so many decisions related to our finances, when choosing a trading app, there is no one-size-fits-all choice that’s right for everyone. Much of the decision comes down to what you want from a service.

Fees aside, there are a number of other considerations that you need to take into account to get the most out of your trading app. These include:

  • How user-friendly do you think the app is?
  • Which investments do you want to trade? Equities, funds or more sophisticated investments?
  • If you are new to investing, can you use the app to practice trading or trade virtually before taking the plunge?
  • Aside from trading costs, what other management fees does the app charge?
  • Is there a minimum investment?
  • Can you use the app to trade tax efficiently through an ISA for stocks and shares?
  • Is your app regulated by the UK Financial Conduct Authority (FCA)?
  • Are there any additional benefits/rewards?

Trading apps for different scenarios

The trading apps market is getting more and more crowded. Here is a selection of apps covering a range of scenarios from beginners to more experienced investors.


1) eToro – good for beginners and social

eToro describes itself as “a bridge between the old world of investing and the new” and claims to be “the only place where investors can hold traditional assets like stocks and commodities alongside ‘new’ assets like the cryptocurrency Bitcoin.”

The app offers a decent mobile experience and, along with some of its competitors, offers the added appeal of zero-commission trading.

eToro also allows users to track and even copy the trades of legitimate investors with a proven track record. FCA regulated.

Related: How to buy cryptocurrency


2) Free Trade – good for easy investing and guides

Freetrade’s basic service offers commission-free trading and access to large and mid-cap stocks in the UK and US, as well as initial public offerings (IPOs) and special purpose acquisition companies (SPACs).

It also offers limited access to a number of companies listed on the German, Finnish and Dutch markets.

Freetrade Plus costs users £9.99 per month but offers significantly more investment choices including all other London listed stocks as well as access to all other European stocks. FCA regulated.


3) Fidelity Personal Investing – good for funds

Fidelity allows investors to choose from over 2,500 funds as well as stocks from the FTSE 100, FTSE 250, FTSE All-Share and FTSE AIM 100. Other investments available include investment trusts, exchange traded funds (ETFs) and some Irish stocks.

The service allows a user to link family members’ accounts to see everything in one place, while a watchlist tracks the performance of up to 50 investments at a time. FCA regulated.


4) Trading212 – good for practicing virtual money trades

Trading 212 offers unlimited commission-free trading with access to 10,000+ stocks and ETFs from the UK, US, Germany, France, Spain, Netherlands and other markets.

For those looking for more sophisticated investments, Trading 212 also offers over 3,000 contracts for difference (CFDs) on stocks, forex, gold, oil and indices.

Users can start with a free lifetime practice account using virtual money. FCA regulated.


5) IG – good for more experienced investors

IG allows users to trade more than 17,000 global markets including stocks, indices, options and commodities.

It offers interactive charts, news, automatic trading alerts and real-time signals. Users can spread bets or trade CFDs on commodities, and options trading is available on various assets on a daily, weekly, and monthly basis. FCA regulated.


Started

For those looking to invest through the stock market, the days of “calling your broker” are long gone.

Most investors looking to buy and sell stocks, build a portfolio of mutual funds, or trade sophisticated instruments such as contracts for difference now do so through an online trading account.

Over the past two decades, investment platforms representing some of the biggest names in stock trading and fund management have filled this need, primarily with services aimed at a desktop or laptop-oriented customer base.

However, in recent years there has been a noticeable shift from desktop to mobile trading among retail investors.

Two factors have helped accelerate this phenomenon. First, the development of ever more powerful smartphones and second, the increasing number of stock trading apps.

The numbers are significant. According to analyst App Radar, there were an estimated 3.1 million Android downloads of the top 10 UK investment apps via the Google Play Store in 2020/21.

App Radar doesn’t track iOS numbers that make up Apple users. But it says the split between Android and iOS downloads is about 50/50. With that in mind, App Radar estimates that there are now a total of around nine million people using trading apps in the UK.

Rise of the Apps

Some of the latest investment trading services offered by “neo brokers” are only available through a mobile app.

To keep up, traditional desktop investing platform providers have developed their own trading apps for clients to use.

The UK’s largest traditional platform, Hargreaves Lansdown, said its app had almost 700,000 users at the end of 2021. More than a quarter of a million customers use their app every day.

One of its competitors, AJ Bell, announced last November that it would launch Dodl, an app aimed at younger consumers, in 2022. One of Dodl’s key features is that it will allow investors to buy shares “commission-free.”

Commission-free trading has become a major selling point for trading apps that rely on other fees to make their money. Below is more information on trading fees in general.

However, fees should not be the only focus of an investment app user.

trading costs

The investing space is littered with variable fees and charges from one provider to another, so figuring out what they’re actually going to pay can be a complicated affair for investors – whether app-based or desktop-based.

When buying and selling stocks, some providers charge a flat fee per trade. Others structure their fees to benefit users who trade the markets more frequently.

Users can also be billed based on the size of their investment. Accounts provided by established platform providers often come with a monthly subscription or management fee.

If you plan to buy stocks overseas — say, invest in US tech stocks that are denominated in dollars — you’ll likely be charged a currency fee.

Meanwhile, if you’re an infrequent trader – say you take a year between trades – your account could be hit with “inactivity” fees.

Several app providers advertise their “commission-free” trading status. It’s a welcome and increasingly popular option across the investing space. But remember, just because trades are commission-free doesn’t necessarily mean your account is completely fee-free.

Brokers make their money in other ways, e.g. B. with withdrawal fees and fees for currency conversion.

Before you sign up with any particular investment app, you should figure out what kind of investor you want to be. Having an idea of ​​how much you will invest, how often you want to trade, and what markets will be your primary focus can help you determine the best and most cost-effective app for your needs.

If protecting your investments from tax is a key concern, ensure your provider has the ability to offer a Stocks and Shares ISA – a package that allows stocks and funds to be tax free with an annual allowance of £20,000 to multiply.

Beware of “random” trading

Two of the main attractions of investing through an app are the ability to trade quickly and, provided you choose the right provider, at little or no cost.

At first glance, this sounds like a winning combination with the potential for improved investment returns for your portfolio. However, research by a team at Frankfurt’s Leibniz Institute says it’s still important to tread carefully, even when you have the investing power of a small trading room in the palm of your hand.

The scientists suggest that a move to app-based trading could do investors more financial harm than good if they’re not careful.

The researchers followed the transactions of 15,000 customers of two large German retail banks over several years. They discovered that people who placed trades through a mobile app were 8% more likely to buy “riskier lottery-like stocks” than when they bought through a computer.

Deals placed through apps were 12% more likely to be in “past winner” stocks, i.e. those that had recently rallied. The researcher concluded that “our results warn against the indiscriminate use of smartphones as a key technology to improve access to financial markets.”

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