Online Brokerage Account

Cotta

Good Morning All,

I am interested in starting to buy Stocks and Shares and a work colleague recommended that I setup a online Brokerage Account, is this good advice and if so what are the recommended accounts?

OwenWill

Hi,

I'm not very experienced in trading as I've only just started out myself, however someone on here recommended https://www.sippdeal.co.uk/ to me and so far they seem good. They have a helpful customer service line that pick up quickly and seem happy to help and aren't overpriced.

I assume this is the kind of thing you want anyway!

Cotta

Thanks OwenWill.

That seems to be what I'm looking for - please forgive my ignorance on this subject but can I submit £100 into a Sippdeal account and for example buy £90 worth of shares, would this account allow me to log in in one week's time and ascertain the value of these shares?

Thanks again.

ChopperST

Cotta wrote: »

Good Morning All,

I am interested in starting to buy Stocks and Shares and a work colleague recommended that I setup a online Brokerage Account, is this good advice and if so what are the recommended accounts?

Depends if you want an execution only broker or something with more bells and whistles.

Also have you done any research into the implications of trading stocks, funds etc. including the risks? If you haven't books like Smarter Investing by Tim Hale are essential before you dip your toe. Also try with a fantasy portfolio first (Bullbearings have a good website) prior to jumping in with your own hard earned.

ChopperST

COTTA

I beg you do not start investing based on the advice of one person on an internet forum when you clearly have no idea what you are doing (not meaning to be disrespectful BTW).

You need to establish;

Your attitude to risk
Timescales involved in investment
Your tax situation
Your current debts
Whether you have a pension
Whether you hold enough cash to support you through a "rainy day"
and a whole number of other factors.

DO NOT JUST OPEN AN ACCOUNT AND START INVESTING

Do you even know what a SIPP is?

Trentenders

Sippdeal dont only provide SIPPS - they also have trading account and ISA products.

My biggest concern with the OP is that they are talking about buying £100 worth of shares at a time. If it costs you £10 to buy and £10 to eventually sell, you'll need an increase of just over 25% in the share price just to break even!

Take time to read up on investing before jumping in, and probably look to save up over a few months before purchasing a share. Much better to buy 2 shares per year at £600 each, than 12 at £100.

Edit: In answer to your last question, you can log in as often as you like and look at the values of each share (usually with a 15 minute delay). Don't waste too much time doing so though....

For smaller investments (under say £1,000), I would seriously only consider purchasing via low cost trading days that some providers offer.

OwenWill

OP, sorry for not giving more info, the other posters here make very valid points and I also need to learn more! (Chopper, on a personal level I will try that book too, thanks!)

However I can give some advise here, in regards to putting in £100 into the Sippdeal account, you're unable to do this. I was looking into it this morning and the minimum amount you can put into the account is £500. Of course some of this can be taken back out, but as is also noted you don't want to invest low as you'd need a huge return to make your money. Let's not forget tax and FX if trading abroad ontop of the brokerage fee!

A good amount to go buy, is to try and make the brokerage fee for investing (£9.95 with Sippdeal) roughly 2% or lower or your total investment, making the ideal minimum investment amount £600. Please if anyone feels I'm wrong here I'd like to hear it as I'm also still learning!

torus

Yes - I'd agree with the other posters to be sure to spend some time learning before using real money. There are plenty on online platforms which you'll find by Googling. As well as starting delaing fees there other costs to look out for. I went with Hargreaves Lansdown but am now regretting that as their online service has been unavailable for 6 hours due to the Royal Mail surge in demand - not a good sign if there was a true financial crisis. I'm looking to move to another platform but Hargreaves Lansdown charge £25 per holding to move - I have 20 or more so that is £500+! Other platforms like Charles Stanley only charge £10 per holding. It's these costs that you don't necessarily consider at the outset. Also HL charge 0.5% Annual Management Fees on top of the £11.95 per deal. CS don't charge on top of their £10 per deal. So it pays to get a spreadsheet and work this all out before choosing. I'm mentioning top end platforms as I like the info they provide but some do deals a lot cheaper (£5.95 or less). Good Luck and even though you've not got a lot of start investing I'd encourage you to get started and build your knowledge and finances - I wish I'd started 30 years ago!

torus

PS I thought The Naker Trader was an excellent starter book - ignore all the spread betting stuff though and concentrate on just learning about shares/funds.

ChopperST

That was the other book I was trying to think of - +1 on that.

Ologhai

Cotta wrote: »

Thanks OwenWill.

That seems to be what I'm looking for - please forgive my ignorance on this subject but can I submit £100 into a Sippdeal account and for example buy £90 worth of shares, would this account allow me to log in in one week's time and ascertain the value of these shares?

Thanks again.

I'll re-post something I just added to one of the Royal Mail threads because it seems to me to be applicable here:

Because trading costs ~£10 a go, £1,000 is probably the smallest amount one ought to buy of a single stock (the smaller the trade, the larger--proportionally--the costs). But a 'portfolio' containing a single stock is far too risky. I don't know what others on here would advise, but a portfolio should probably contain at least ten different stocks to be able to be even remotely diverse...

So, that's £10,000 to start even contemplating trading individual stocks under normal circumstances.

If you bought £100's worth of shares in one company, the ~£10 trading fee would mean that you'd be 10% down on the deal immediately.