In 2020 there was a huge surge of interest in DIY investing with trading apps picking up many new customers. These apps can be a bit like a fast car. In the right hands, they can be a great option to get from A to B. In the wrong hands, they can be dangerous.
On the plus side, they are often pretty competitive on fees. They tend to be good on mobile and/or have a strong app. And frankly they can liven up what was traditionally a staid experience. So you can pay less for a better time.
On the downside they can gamify things to the extent of encouraging risky behaviours and also promote individual stock ownership above a more boring balanced portfolio. Which adds lack of diversification risk to more general market risk. All of which is fine in a rising market but that party wont go on forever. Like everything else, a gobby few on social media might claim it’s all easy fun, but the reality can be a bit uglier.
So – buyer beware but at the same time, Buyer, this could be an interesting option for you. We’ve sifted through the major providers here and highlight which ones we think are good. And why.
As a side note, some of these guys offer access to spread betting and crypto. As all the disclaimers say, about 80% of those doing spread betting lose money. ‘Nuff said. Such a bad idea. And crypto? It’s anyone’s guess. We don’t think it’s investing but a punt on the future and the sentiment of crowds. Maybe a side bet – but not something we back as a long-term, sensible investment strategy.
Can execute high volume of trades, frequently, without incurring significant expenses. Commission-free / low commission trading.
Perhaps some kind of contrast graphic between AJ Bell, HL and trading apps at higher trading volumes.
Perhaps mention disadvantage of not being able to hold mutual funds (key distinction between trading apps and normal platforms).