If you are thinking about becoming an investor, there are many things that you need to consider. Firstly, you need to ask yourself why you are doing it. What do you think you can gain?
What is your ultimate goal? Are you willing to put in the energy and effort to meet that goal?
Once you have answered those questions, the next thing you should figure out is how you will invest. This factor is a very pivotal and vital part of your investment journey. Everyone has their favourite method of investing. Back then, people would simply call their broker and make orders that way.
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Visit Plus50080% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
With the invention of the internet and especially smartphones, investing has never been easier. There are now more options than ever before when entering the marketplace. But this means you have more options and more pressure to make the right choice.
Best Online Brokers for Beginners
Multiple online brokers are willing and waiting to help you invest and teach you everything you need to know about investing.
But which online broker is the best choice for someone who has never put their money down before?
Below, we have a list of the best online brokers for newcomers.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 51%(eToro) – 80% of retail investor accounts lose money when trading spread bets and/or CFDs with these providers. 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. The value of your investment can go down as well as up, and you can get back less than you originally invested.
| Provider | Score | Details |
|---|---|---|
| 1. Plus500 | ★★★★★ | Learn More |
| 2. Pepperstone | ★★★★★ | Learn More |
| 3. IG | ★★★★★ | Learn More |
| 4. Bestinvest | ★★★★★ | Learn More |
| 5. Charles Schwab | ★★★★★ | Learn More |
| 6. Interactive Brokers | ★★★★★ | Learn More |
| 7. eToro | ★★★★★ | Learn More |
1. Plus500
80% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Plus500 is an online broker that works perfectly for newcomers to the trading market. It’s among the bigger platforms known to be easy to use.
Trading takes just a few clicks and requires you to create and log in to your account, search for a financial instrument, consider the potential direction you think the instrument will move in, select “buy” or “sell”, and open the trade. It’s that easy.
Plus500 does feature a trading academy, a resource that lends itself perfectly to beginners. In the trading academy, you can learn the crucial features of the platform and refine your trading skills. From “how-to” videos to e-books, the platform has it all.
The user interface is easy to navigate, and if you know nothing about the Plus500 stock broker platform, you can select the “try free demo” button to activate demo mode. This mode will allow you to trade without losing money. Of course, you won’t earn money because it’s virtual, but it’s the perfect addition for beginners.
Some features ideal for beginner traders include push email and SMS notifications that work based on price alerts and more. With these alerts, even as a beginner trader, you’ll always know when the price reaches the set price.
The icing on the cake is the +Insights platform, a community-driven data platform to help you trade. Specifically, this feature helps you analyse millions of traders’ activity in real-time. It’s ideal if you’ve never traded before.
Plus500’s +Insights platform works when you choose a trend to analyse. It will show you the top 10 results reflecting traders’ activity on the Plus500 platform. You can learn which commodity was the most bought, the record return on forex trades over time, the index most people followed, and more. If you then want to trade, you can open a position to buy or sell from the same screen.
The Financial Conduct Authority regulates and authorises Plus500, so it complies with the regulations of this body. It is a trustworthy platform that is easy to get started with.
You can trade commodities and a huge range of other financial instruments with Plus500. It’s a platform worth looking at if you want to start trading.
2. Pepperstone
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.2% of retail investor accounts lose money when trading spread bets and CFDs with this provider. 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.
Pepperstone is one of those online brokers that is all too often overlooked. Here’s the thing — it’s a pretty great choice, especially for beginners. All too often, the big guys take the spotlight, though, leaving Pepperstone in the dust. But not today.
Pepperstone does have a slightly higher minimum deposit, but it’s not outrageous. Most beginners will likely be able to come up with the minimum.
This platform is very smart and engaging, providing beginners with great information to make the most of their trading experience.
You can set up price notifications for stock watches, monitor key signals in the market, and even scalp from others in some cases. Where some online brokers only have mobile or only have a desktop, Pepperstone brings you mobile, desktop, and web access.
You have the right to invest your way and access your account from anywhere convenient with this broker. They have excellent customer service, including live chat support if you need someone immediately.
The company has been around for quite some time and has proven trustworthy and reliable to date. They are heavily regulated through FCA and ASIC, which tells you they adhere to a certain standard, and you can trust the company.
You can’t go wrong here if you’re looking for a platform with plenty of research, simple trading platforms, and support that will have your back when needed.
3. IG
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. 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.
IG is perhaps one of the most sought-after online brokers for beginners and has won several awards for offering an excellent platform with generous tools and resources available to its clients.
They also have one of the best broker apps that you could find. People like IG because they have a wide variety of assets that you can get involved in. As a beginner, you may want to start simple, but as you build your knowledge and experience, you might venture into things like Forex and Futures, which are all available here.
You can access all your accounts in one place with IG investments.
It doesn’t matter if you have retirement, savings accounts, and other types of brokered accounts; it’s all centralised together for you.
Another favourite about IG Investments is the ability to start your account with zero pounds. There is no minimum, and sometimes, that is the inspiration a beginner needs to decide to jump into the market. Everyone should have an equal chance or opportunity to invest, even if you need to start small, right?
They do have full access to a trading platform through your mobile app.
You can also use the desktop model. Both are intuitive and user-friendly. There are so many tools that can be a great resource for beginners as well. Start with the knowledge, learn what you can, and use that to expand and play with your chosen strategies.
4. Bestinvest
The value of your investment can go down as well as up, and you can get back less than you originally invested.
As a beginner, looking for something simple and user-friendly is often the priority. But you also want to access a platform that can grow with you or makes it easy to transition when you’re ready to move along. Bestinvest does both of these things, and they’re doing a great job of it.
As stated in our Bestinvest (review), the platform provides you with simple but reliable market information. It’s just enough to give you great commentary and resources without making you feel overwhelmed and overloaded with information.
Their customer service is great, and they are available six days a week. You can access customer service from live chat, email, or even over the phone.
If you’re looking for investment tips or advice, you can take advantage of and greatly benefit from the one-on-one coaching sessions. These can be helpful for beginners trying to get a feel for the industry.
Those sessions are even free, which is certainly advantageous as well.
This option is a somewhat small platform, which is owned by a larger wealth management firm. They serve more than 45,000 clients, and you can access more than 1100 shares, as well as more than 2200 funds or investment trusts.
There is a small fee for share dealing, but it’s not excessive. It’s reasonable and comparable to some of the others in the market. When you consider the coaching and resources, it isn’t bad at all. The biggest downside is they don’t have trading available on the app yet. You can do it from your computer, or you can call in a trade.
5. Charles Schwab
Investing in U.S. securities is not without risk. Investment returns will fluctuate and are subject to market volatility, so that an investor's shares, when redeemed or sold, may be worth more or less than their original cost.
The first bargain broker, Charles Schwab, transitioned smoothly to being an internet broker and is now one of the best in the modern age — and also one of the most ideal for someone who hasn't ever put money into the marketplace.
Making the entire situation painless, Charles Schwab provides a significant range of services that will assist you in transitioning from inexperienced to comfortable, successful, and seasoned investors.
In addition to stock data, reports, and business news from various sources, Charles Schwab also provides a screener that can be used to find a successful fund.
Thanks to their excellent starter instructional resources, you can discover all the basics of wise investing.
This feature is one of the major reasons Charles Schwab is so great for beginners.
People with little experience in the market will be able to learn a lot quickly because the educational tools offered by Charles Schwab are specifically designed for those who are testing the waters of the marketplace.
A perfectly functioning app gives you access to almost all of the features found on a desktop version. Additionally, Schwab has several awesome options for novices. With a minimum deposit and a friend's promotion code, you can get a substantial bonus of up to $1,000 (£815). The $50 (£40) reward will be placed in the five biggest stocks in the S&P 500.
6. Interactive Brokers
Investing in financial products involves taking risk. Your investments may increase or decrease in value, and losses may exceed the value of your original investment.
If you know as a beginner that you will likely want access to a large range of assets within the investment banking world, consider the Interactive Brokers platform. This platform is user-friendly for beginners but has also been designed to be advantageous for experienced and professional traders.
Everyone has to start somewhere, but that doesn’t mean that you should be stuck in a platform that holds you in that starting place.
It’s important to be able to grow with your knowledge, strategy, experience and skills and expand your reach in the investment industry.
Does everyone need access to global assets or things like options and futures? Well, no, they don’t. But that doesn’t mean it isn’t beneficial to have them available to those who want to invest in those realms.
And with that in consideration, this platform offers a host of local and global market assets for investors of all statuses to get into. The best part is that it isn’t overwhelming for beginners to access and use. You will have plenty of resources and won’t be bogged down by the things you aren’t interested in, either.
You can also start your Interactive Brokers investment accounts with no minimum deposit, which is one of our favourite details when it comes to what is best for beginners. Invest small, and build as you are able.
7. eToro
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. {etoroCFDrisk}% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
When you’re just beginning, the ability to watch others and learn from them often comes in handy. You can do just that with eToro, making it another top choice for the best online brokers for beginners. It is suited to beginners but doesn’t push away experienced investors.
Instead, eToro encourages experienced investors to share their knowledge with beginners. They are unique in that you can watch other investors and even copy their trades if you feel that suits you.
This online broker does have a minimum deposit of $100, but this is still very low and friendly to beginner users. Take the time to learn the process, watch what others are doing, and try things for yourself. The platform is intuitive and simple to work with. When you trade stocks, there are no commissions.
You might incur a fee if you go inactive, so you must be mindful of this to avoid it. eToro charges an inactivity fee of $10 per month if your account has been inactive for longer than 12 months.
eToro operates much like a social platform but with the ability to invest. This feature is one of the things that make them unique, and they have been incredibly popular so far. They have a great reputation and are headquartered in the UK.
The only downside is that you can’t use it on a desktop yet. Right now, they are only compatible with mobile devices.
What to Look for When Choosing Online Brokers for Beginners
Now that you’ve seen some of our top picks for online brokers for beginners let’s talk about how you can make your final decision.
Here are a few details that might help you choose from these options.
Commissions & Fees
Your goal on this platform is to succeed and probably do so easily. No online broker can promise absolute results, but they can promise you lower fees. The problem is that some platforms will advertise these really neat things. But then they charge you outrageous commissions or fees on trading.
Never sign a contract or create an account without determining what commission and fees will be charged. It’s a good idea to compare companies to find the best match.
Investment Platform & App
You may not be able to fully try out a platform without creating an account, although some sites have demos you can look through. Take a look at the features of the platform and the app to determine if it’s user-friendly or set up well.
You can also look at what others are saying. As a beginner, you need something easy to use and understand. Look for the technological features and the ability to find valuable educational information for your trading commitments.
Customer Service
Great customer service is vital on any type of platform. You could have a free and cheap platform but have to sacrifice good customer service. Or, you might be able to find an affordable platform that has stellar service.
Often, paying for the stellar service is well worth it.
We’re talking about your finances here. You should have access to customer support, and they should be phenomenal to work with. While not every company is the same in terms of support, you want to make sure it’s at least acceptable support and service available to you.
Common Questions to Consider
The following are some of the most common questions about finding an online stock broker for beginners.
These may be helpful to you as well as you decide who to use.
Are Brokerage Accounts Safe?
When you use a qualified broker online, your money is safe. There is no safety guarantee for investments, but there is protection against fraud or broker companies that fail. Be sure to only allow investments that fit into your risk profile so you aren’t nervous.
Is Hiring an Online Broker Worth It?
Even with online brokers, you can manage things and make decisions. An online platform simply provides you the space to trade as you wish. You can hire full services where you get recommendations and expertise, but this isn’t required.
How Much Do Online Brokers Cost?
The cost of these online brokers will vary from company to company. Be sure to check this out and compare. Some have monthly fees, while others will have no fees like that. Also, look at trading costs and commissions to get a full idea of how much it will be.
How Does an Online Brokerage Work?
Online brokerage platforms are similar to online banking, giving you access to the investment world. You can buy and sell mutual funds, bonds, stocks, etc. That is something you cannot do with traditional banking.
How you invest and your investment strategy will ultimately depend on your needs and preferences.
All trades or account establishment details will be set up within the platform of your choice, and you can make transactions as you are ready to do so.
Can You Cash Out Your Online Broker Accounts?
Yes, this is your account and your money. You can cash out at any time. What you cash out for will be subject to the market's prices at the time. You should know that it won’t be instant when you cash out, like using an ATM at the bank.
First, you must sell anything invested and wait for that to settle. This process could take several days for some assets, but it might only take one or two days. When they settle, money can be transferred to you minus any necessary fees.
Invest in Your Future With Online Brokers
An online broker platform is meant to be a convenient and easy way for you to get involved in the investment industry. As a beginner, you have plenty of options to choose from. If you have specific needs or interests, choose a broker that will accommodate those preferences.
All the online brokers we’ve shared here are great for beginners. Try one out and see what your investment future holds for you. Consider all of the details to make a final decision.
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