IS TRADING 212 the best option for ISA?

Alexland

Petriix said:

I don't expect many people are like me. I'm pretty risk-averse and I wanted to dip my toes in a few things. But that's the advantage of something like T212. It gives me the chance to try things out and learn how it works before I commit any significant amount of money. 

I started investing just before the dot com crash and having tried out lots of things settled on money market funds, multi asset funds and index trackers depending on how long the money is likely to be invested.

The biggest risks in investment are with individual investor behaviour so the fewer decisions you need to make the less mistakes you make.

Having said that the past few years have been difficult as low interest rates caused bonds to be priced so high they were a risk in themselves. I had to take more equities risk for a while but now things are priced normally again it's a chance to get back to textbook portfolio theory.

gt94sss2

Petriix said:

I suspect that Trading212 take a little extra out of the spread on market orders.

That would be illegal.

thenewcomer

Petriix said:

I suspect that Trading212 take a little extra out of the spread on market orders. Someone on here recommended exclusively using limit orders to avoid this but these can go unfulfilled.

sorry. what do you mean? how does using limit orders avoid that?

Petriix

thenewcomer said:

Petriix said:

I suspect that Trading212 take a little extra out of the spread on market orders. Someone on here recommended exclusively using limit orders to avoid this but these can go unfulfilled.

sorry. what do you mean? how does using limit orders avoid that?

When you use a limit order you can set the maximum price you are willing to pay per share. Otherwise you will pay the immediate 'market rate' but this sometimes seems to jump up by a few pence. For shares where the price is fluctuating, setting a limit price seems like a reliable way of avoiding buying as the price spikes. 

gravel_2

It does also mean you may miss your buying point if the stock heads, and stays, up.

wmb194

thenewcomer said:

Petriix said:

I suspect that Trading212 take a little extra out of the spread on market orders. Someone on here recommended exclusively using limit orders to avoid this but these can go unfulfilled.

sorry. what do you mean? how does using limit orders avoid that?

I've been using T212 a lot and I watch the live bid/offer prices and the trades that are passing through the market and I haven't noticed T212 filling my orders away from the prevailing market price. However, if the price is moving quickly a limit order reduces the risk you'll pay more or take less than you're aiming for.

If it makes something on the trade it's through its own market making, apparently it's a non-dealing desk market maker.