Financial advice for UK based investors, on buying equities for the first time?

We’ll offer all the tips needed on how to buy shares in UK in our beginner’s guide. We’ll go through how to choose an approved and regulated broker, what to anticipate in terms of costs, how to make your share order for the first time, and how to pick the correct stocks.

Before you start purchasing stocks, you must first choose a reputable stock broker. In order to assist you, we’ve compiled a list of the top 5 UK brokers, along with a detailed description of their features and prices. You may also enter your budget and the total number of trades you wish to do, which will help in determining the costs for each broker.


A Step by Step Guide to Buying Shares in 2022

Although the procedure is identical for various stock brokers, this stepwise tutorial of how to acquire shares is centered on our suggested, licenced brokerage eToro.

Step 1. Register for an eToro account.

To open an account with eToro, you’ll need to provide your full name, an active email address, and a unique password.

Step 2. Make a Deposit

You should fund your eToro account once it’s been set up. To fund your trading account, the broker takes debit and credit cards, in addition to PayPal.

Step 3. Buy Shares

You can buy your first share when your eToro account has been credited with funds. In this instance, we’re trying to purchase BP stock. So, to start a new order, we’ll type ‘BP’ into the search box at the top of the page and then click ‘TRADE.’ Then, to conduct our first stock transaction, we’ll input the desired amount for the trade and click ‘OPEN POSITION.’ That’s about it — in just three easy steps, you’ve learnt investing in stocks in the UK.

That’s it – you’ve now learned how to invest in stocks UK in just 3 simple steps!

Fundamentals of Purchasing Stocks in the UK

You can now acquire thousands of worldwide shares with the flick of a key, thanks to the way UK share trading operates today. You only need an account with a reputable online stock broker.

To top of everything, with hundreds of stockbrokers in the UK vying for a piece of your pie, fees and charges are currently at the lowest. Indeed, there are equity trading platforms in the UK that allow you to acquire stocks without incurring any transaction fees.

What Exactly are Shares?

When an organization chooses to become “public,” it will be listed on a stock exchange. As a result, regular investors will be able to purchase stocks or ‘shares’ in the corporation. According to the quantity of stocks you own, you now enjoy a ‘share’ of the firm you invested in.

Market forces determine the stock value of a company. To put it another way, if the buyers outnumber the sellers, the price of a stock will rise. When that happens, the value of your investment will rise in tandem. However when there are more sellers than buyers, this has the reverse effect, i.e. lowering the value of your stock. As a shareholder in a corporation, you will now be privileged to a number of advantages.

Trading Stocks

At the forefront of this is an entitlement to dividends and the ability to vote at Annual General Meetings (AGMs). You can sell shares at any given time during standard market hours. The amount you receive back in cash will be based on the number of shares you hold against that of the current stock price of the

An entitlement to dividends and getting voting rights at Annual General Meetings (AGMs) are at the forefront of this investment. Just like buying stocks, you can also sell them.

During regular market hours, you can sell shares at any moment. The amount of cash you get will be determined by comparing the quantity of shares you own to the company’s current share price. While purchasing your first share, we recommend bookmarking our shares terminology page.


Is it Possible to Make Money Investing in Shares?

Try out our easy investing calculator to see how much money you may make while learning to invest in stocks in the UK. Keep in mind that traditionally, stocks have returned between 6% and 7% yield every year.

6
This investment will be worth: £7,091
202220232024202520262027£0£2,000£4,000£6,000£8,000
GenreStarting AmountTotal Interest Earned
2022£5K£300
2023£5K£618
2024£5K£955
2025£5K£1.31K
2026£5K£1.69K
2027£5K£2.09K
29.5%70.5%
TaskHours per Day
Starting Investment£5K
Total Interest Earned£2.09K
Starting Amount: £5,000Total Interest Earned : £2,091
Year Starting Amount Annual Contribution Total Contributions Interest Earned Total Interest Earned End Balance
2022 £5,000 £0 £0 £300 £300 £5,300
2023 £5,000 £0 £0 £318 £618 £5,618
2024 £5,000 £0 £0 £337 £955 £5,955
2025 £5,000 £0 £0 £357 £1,312 £6,312
2026 £5,000 £0 £0 £378 £1,690 £6,690
2027 £5,000 £0 £0 £401 £2,091 £7,091

Stocks and Shares: How to Earn Profits

Capital gains, dividends, and compound growth are three methods to attain this objective. Now let's discuss them in a bit more detail.

Capital Gains

‘Capital Gains’ occur when the total share value of your holding rises above the amount you paid when you first bought them.

As an example,

  • Assume you purchase 1,000 BP shares at 450p per share
  • This translates to a capital investment of £4,500
  • BP stocks are trading at 550p per share, five years later
  • Per share, you made a profit of 100p, i.e.550p - 450p
  • You opt to trade-off the shares since you are content with your profits
  • This equates to a profit margin of £1,000 based on 1,000 shares

Capital Gains are the profits earned, i.e. £1,000. You must report Capital Gains to HMRC in the United Kingdom. The tax rate you pay will be determined by your individual circumstances.

Dividends

This is another way to profit from stocks. Dividends are a simple way for major corporations to pass on their profits to investors.

You are eligible for your part of the earnings if and when the companies declare dividends. The amount of dividend income you receive will fluctuate based on the company's performance. Dividends are not paid on every share, however if that’s the case then they are usually paid every three to six months.

Stock dividends at work,

  • Suppose you own 500 HSBC shares
  • Every three months, the company distributes dividends
  • HSBC has announced a dividend yield of 7% this time around
  • This works out to be £0.28 / share
  • You own 500 shares, thus you'll get £0.28 x 500 shares = £140

The nicest aspect about dividends is that they are paid on top of whatever Capital Gains you have earned. In a perfect world, you'd be investing in equities that appreciate in value while also paying out regular dividends.

While previous performance isn't always a reliable predictor of future outcomes, the annualized average returns of the FTSE 100 over the last 25 years are shown below.

In order to replicate these results, you'd have to make an investment in a FTSE 100 tracking mutual fund or an ETF.

Compound Growth

Many investors choose to reinvest an asset's profits rather than cashing out capital gains or waiting for dividends. Compounding is a term for this. You may produce a compounding effect by keeping shares for a longer period and reinvesting capital gains often.

Consider the following example of Compound Growth

  • You make a monthly investment of £100 in an asset with a 6% return
  • You'll have invested £13,200 and have £18,915 in ten years
  • You’ll have invested £25,200 and have £50,640 in 20 years
  • In 40 years, you’ll have invested £49,200 and have £209,201

Since you profit on the earnings you reinvest on top of the original investment, your investment increases in this way. This implies that you will receive more income on your initially invested funds as well as your compounded earnings each year.

As the gains during the initial period are modest, compound growth needs patience. However, in the long term, it may be quite profitable. Although you must account for share volatility, fees, and inflation, compound interest may be one of the most effective methods to increase your wealth through stocks if done correctly.


Considerations Before Buying Shares in a Corporation

Although stock exchanges have traditionally done well, this is not true for all businesses. Many companies, either in the UK or abroad, are today worth a significant fraction of what they were at their previous peaks. This is particularly true in the UK premium banking sector, with companies like Natwest and HSBC never fully rebounding from the 2008 financial crisis.

In light of this, we've compiled a list of useful share advice to help you minimize your risks while learning to invest in stocks and shares in the UK for the first time.

💡 Tip 1: Diversify your portfolio

Diversification, in an essence, is the polar opposite of placing all of your eggs in one basket. Rather than investing in a couple of firms, a well-diversified portfolio might include maybe hundreds of different stocks. Not only that, but you'll be investing in companies from a variety of industries, ensuring that you're not overly focused on a particular area. 

Consider the following scenario, 

  • You've got £5,000 to stake into the equities market.
  • An unskilled investor may decide to invest the full £5,000 in one firm.
  • At £50 per share, a savvy investor most likely would acquire stocks in 100 different firms. This would also cover a variety of industries.

💡 Tip 2: Begin with minimal stakes

If you've never invested in shares in the UK before, it's a good idea to start with small holdings. In fact the majority of registered UK stockbrokers ask you to invest a minimum amount, which is usually between £100 - £200. You are not, however, compelled to invest your whole amount in a single deal.

Trading platforms like eToro, on the other hand, allow for a $10 (£7.60) minimum stock investment. As a result, starting with little quantities will allow you to gain confidence without breaking the bank.

💡 Tip 3: How to Conduct Stock Research

You should also get the knowledge of studying equities while learning how to buy stocks. We're not talking about highly technical details, like derivatives or chart reading, here. Instead, make sure you're aware of any significant market changes that might affect the value of your investment.

For instance, 

  • Assume you have a £3,000 investment in Royal Mail.
  • What effect in your opinion will it have on the stock price when Royal Mail announces plans to layoff tons of employees?
  • Negative news like this would very certainly trigger a huge sell-off by investors.
  • As a result, the share value will decrease.
  • With that in mind, selling the stock as the news breaks would give you the best opportunity of limiting losses and recovering to a larger extent.

Check out our best shares to purchase guide for additional information on stock advice and selling shares.

💡 Tip 4: Consider putting together a copy trading portfolio

If you're unfamiliar with how stocks and shares operate, a copy trading portfolio could be worth investigating. Platforms for novice investors, such as eToro, allow you to copy the trades of more experienced investors.

This includes not only their present portfolio but also each and every investment inside it. The best part is that you can check out the trader's qualifications before committing any funds. Copy trading allows you to invest in stocks without having to do any of the legwork, which is why it's so popular among rookie investors.


Choosing a Stockbroker in the UK and other Countries

You've learned about buying stocks, but have you partnered with a trustworthy stockbroker that understands your investing goals? There are a lot of brokers in the field, with each one having its own set of features, fees and trading assets, so you should do some research before committing to one.

The following are a bunch of significant things to keep an eye out for, when hiring a stockbroker.

Financial Conduct Authority (FCA) Regulated Brokers

By far the most crucial factor to examine before joining up with a UK stockbroker is whether or not it is regulated by the Financial Conduct Authority (FCA). This ensures that you may purchase, sell, and exchange stocks in a safe and secure manner.

Brokers regulated by FCA, bring the following benefits to the table,

  • Before they can lawfully accept UK traders, all FCA registered brokers must go through a rigorous and drawn-out application procedure.
  • The FCA will examine the platform's finances every quarter.
  • All customer finances must be kept separate from one another in separate bank accounts. This provides an important protection since it prevents the broker from using your cash to support its own operating costs.
  • Segregation of bank accounts also means that your funds would be ring fenced if the broker ran into financial difficulties.

Overall, if a UK stock trading platform doesn't have that all-important FCA license, don't sign up with it.

Payment Methods Used in The UK

After determining the broker's regulatory status, you must determine which modes of payment it takes. Debit/credit cards and bank account transfers are accepted by the great majority of UK share selling platforms. Bank Transfers are better suited to deposits of more than £10,000. Bank wired money takes from 1 to 3 business days to arrive in your account, depending on the broker, but they may be credited in as little as two hours if you use a quick bank transfer.

E-wallets like Neteller, Skrill, and most notably Paypal are accepted by stock brokers like eToro. In terms of accessible banking methods and minimum deposits, here's how some big UK brokers stack up.

Stock Broker Payment methods Minimum deposit
eToro VISA, MasterCard, Bank Transfer, PayPal, Skrill, Neteller £50
Capital.com VISA, MasterCard, Bank Transfer, Trustly, Apple Pay £20
Libertex VISA, MasterCard, Bank Transfer, PayPal, iDeal, Sofort, Neteller €100 (£85)
Plus500 VISA, MasterCard, Bank Transfer, PayPal, Skrill $100 (£75)
AvaTrade VISA, MasterCard, Bank Transfer, Skrill, WebMoney, Neteller $100 (£75)
Fineco Bank Transfer No minimum deposit

What Types of Stocks Can You Buy in the UK?

There are thousands of publicly traded corporations across hundreds of stock exchanges around the world. Importantly, the markets you can have access to will be determined by the broker with whom you join up. You can purchase, sell, and trade over 10,000 different firms on eToro, Plus500, and Alvexo, for instance.

This applies to companies that are listed at, 

  • London Stock Exchange (LSE - UK)
  • Alternative Investment Market (AIM – UK)
  • NASDAQ (US)
  • New York Stock Exchange (NSE - US)
  • Tokyo Stock Exchange (Japan)
  • Hong Kong Stock Exchange (Hong Kong)
  • And many others, in every country of the world

It's ideal to go with a stock broker who covers both domestic and foreign markets since this will provide you the best possibility of risk diversification. For instance, eToro allows you to buy stocks from 17 different marketplaces.


Brokerage Fees in the UK

When looking for a stock broker, there are a lot of fees and charges to consider, including trading commissions, yearly account charges, and withdrawal costs.

The best part is that you may buy stocks on numerous UK share trading platforms without paying any transaction or annual fees. Instead, they profit from the 'spread,' which is a one-time conversion cost charged on when making your initial deposit (eToro, for instance, charges 0.5%).

Check out our stock broker comparison table below to get an idea of how much you'll pay once you've learned about investing in shares in the UK.

UK Stock Broker Fees Charge Per Trade Annual Fee Conversion Fee
eToro Free N/A 0.50%
Alvexo Tight Spreads N/A N/A (GBP deposits accepted)
Capital.com Free N/A N/A (GBP deposits accepted)
Libertex Variable Commission (based on volume) N/A N/A (GBP deposits accepted)
Plus500 Free N/A Up to 0.3%
AvaTrade Free N/A N/A (GBP deposits accepted)
Fineco From £2.95 per trade N/A N/A

The Best Stock Trading Platforms in the UK

It might be difficult to find the time to study the operational nitty gritty of an online brokerage. The top share dealing accounts that fulfill most of the basic standards and can function as portfolio managers for your investments are listed below. This includes the necessary Financial Conduct Authority license, as well as support for UK bank accounts and credit or debit cards, as well as the capacity to purchase and sell shares in both local and foreign firms.

1. eToro – Slick UK Stock Broker for Copy Trading

eToro tops the list of our preferred stock brokers since it enables you to buy over 800 different stocks without paying a commission. eToro takes the cost of stamp duty to reduce costs even lower, making it one of the most affordable brokers on the market. eToro is an FCA-regulated broker that is especially popular among millennials who are new to investing in terms of safety and security. It's straightforward and quick to open an account, and all it takes is a $10 (£7.60) deposit to get started.

You may invest in British blue-chip companies like Tesco, BT, and Rolls-Royce, as well as the top technology ETFs UK and trendy tech stocks like Amazon, Apple, and Tesla, at eToro. One of the key reasons for eToro's inclusion on our list is that it allows you to purchase and sell stocks without incurring any transaction fees. You can purchase bitcoin UK, Ethereum, Ripple, and a range of other cryptocurrencies on the platform.

This is a game-changer in the UK investing landscape and share trading, since firms like Hargreaves Lansdown charge upwards of £11.95 for every trade. Instead, just the 0.5% conversion cost on your deposit is considered a fee.

You will have to pay a tiny charge known as the spread if you want to trade stock CFDs, which have a leverage of up to 1:5. The distinction between buying real stock and trading stock CFDs may be found here.

The FCA has granted eToro a full license. It's also regulated in Australia (ASIC) and Cyprus (CySEC), giving you three levels of regulatory protection.

It just takes a few minutes to get started with an investing account. You can use a UK debit/credit card, bank account, or e-wallet to finance your account. After the broker has processed your money, it will be translated to US dollars for a charge of 0.5 percent. This allows you to trade internationally without having to constantly worry about currency rates. If you want to deposit more than £2,000, you must provide identification to eToro. The platform can handle huge transactions - up to £40,000 per card transaction and has no restriction on bank wire transfers. These would entitle you to a VIP account manager and a face-to-face meeting at the company's London headquarters.

Another advantage of eToro is its copy trading feature, which allows you to replicate successful stock investors and develop similar portfolios. However, there are additional fees associated with this function. Check out our eToro review for a more in-depth look.

Useful Hint: Because eToro does not compute any taxes you may owe, such as capital gains tax, you must do it yourself based on your country of residency.

Pros:

  • FCA-regulated and well-known brand. Sponsor of the Premier League.
  • Invest in equities without having to pay a commission or share trading fees.
  • Trades in over 1,000 equities listed on different international exchanges.
  • Deposit money using a debit or credit card, an e-wallet, or a UK bank account
  • Copying other users' trades is possible.
  • Customized eToro account with the ability to set up trading price notifications

Cons:

  • Not advantageous for skilled traders who prefer performing technical analysis.
  • Forex spreads are quite wide
  • On your deposit, there is a 0.5% conversion charge.

68% of retail investors lose money trading CFDs at this site.


2. Alvexo – Popular CFD TradAlvexo – Tight Spreads on a Popular CFD Trading Platform

Alvexo is a great place to start if you're searching for a good place to buy stocks. You may trade CFDs on 450+ tradable assets, including FX, equities, commodities, and indices, using this reputable and fully regulated trading platform

You should consider many crucial parameters when choosing a trading platform to buy and sell stocks and other financial assets. What charges will I be responsible for? How many different sorts of accounts are there? Will I have to deal with any overnight or inactivity fees if I buy and keep stocks? All of these are crucial considerations for new traders to consider.

To begin, it's worth noting that Alvexo is a CFD broker. As a result, you will be speculating on the underlying assets' price fluctuations rather than taking ownership of any securities. With that stated, you can expect to trade CFDs with typical spreads beginning at 2.9 pips and leverage up to 30:1 if you establish an Alvexo Classic account. Furthermore, when you trade CFDs with Alvexo, you will not be charged a commission. If you keep CFD positions open after the markets close, you will be charged overnight costs. These swap costs are calculated using rates provided by the broker's liquidity provider and vary depending on the asset type.

There is a minimum deposit of €250 for non-trading fees, and certain payment methods include transaction costs. Swap costs are levied on all open transactions that are left overnight for each business day the position is open, as previously stated. In addition, if your account has been inactive for three months, you will be charged a monthly maintenance cost of ten units of the account currency.

When it comes to choosing the right trading account for your needs, Alvexo provides access to four different accounts. The most basic is the Classic account and this has a minimum account size of €500 with spreads starting at 2.9 pips. For a Prime account the minimum account size is €50,000 and spreads start from 1.8 pips. You’ll also find that the range of CFD instruments also varies depending on the account type.

Turning our focus to the trading platforms that Alvexo offers, forex traders will be glad to find that MetaTrader 4 is one of them. If you're just getting started with CFD trading, the Alvexo WebTrader and Mobile app are excellent options. On the main website, you'll also discover a wealth of educational resources under the Alvexo Plus option.

Lastly, Alvexo is tightly regulated by the Cyprus Securities and Exchange Commission because it is located in Limassol, Cyprus (CySEC). In terms of customer service, you can reach out to them by email or phone, and they have multilingual staff on hand to help you with any queries or concerns you may have. Read our in-depth Alvexo review for a more in-depth examination.

Pros:

  • On CFD transactions, there's no commission
  • CFDs on 450+ assets are available to trade.
  • MetaTrader4 is supported.
  • Tight spreads
  • Fully regulated by CySEC
  • Provides a free demo account.

Cons:

  • CFDs are the only assets in the portfolio.
  • After three months of non-use, there is an inactivity fee.

69.80% of retail investor accounts lose money when trading CFDs with this provider.


3. Capital.com – Trading Stock CFDs on the Best Platform in the UK

Capital.com is a CFD broker that trades over 3,000 stocks from the United States, the United Kingdom, and Europe. Capital.com makes it simple to go long or short on any firm, thanks to its large variety of shares that can be traded with leverage up to 5:1.

Capital.com does not charge any commissions, and the site has some of the lowest spreads we've observed in the UK. There are no fees for deposits, withdrawals, or inactivity, so you won't be surprised by charges in your account.

Beyond stock CFDs, Capital.com offers a wide range of assets to trade. Over 140 currency pairings, 84 cryptocurrencies, and dozens of commodities, ETFs, and stock indexes are available to trade.

Capital.com's proprietary trading platform, which is available on the web and on mobile devices, is a key part of what sets it apart. You get access to hundreds of technical indicators as well as charts that are extremely user-friendly. Capital.com also has a TradingView integration, which allows you to set custom indicators to analyze market movements. Better still, Capital.com's technology uses artificial intelligence to detect patterns in your trades and recommend strategies to enhance your win rate.

This broker provides a multitude of instructional tools for beginner traders. There are many videos and tutorials available that will lead you through the fundamentals of CFD trading and explain common trading methods. The platform even offers a specialized education mobile app that includes quizzes to assess your trading expertise.

The FCA (the Financial Conduct Authority) and CySEC (the Cyprus Securities and Exchange Commission) regulate Capital.com. The brokerage provides customer service through phone, email, and live chat 24 hours a day, seven days a week, making it simple to fix any concerns you may have with your account. To start an account with Capital.com, all you need is a £20 deposit, which you can do using a credit card, debit card, or bank transfer.

Pros:

  • CFD trading is completely free of commissions.
  • OOver 3,000 shares from the United States, the United Kingdom, and Europe.
  • Trade forex, commodities, cryptocurrencies, and other financial instruments.
  • Powerful trading platform that supports technical analysis.
  • Regulated by the FCA and CySEC
  • Customer service is accessible around the clock.

Cons:

  • Only CFDs are allowed.
  • Trading stocks with a low leverage.

75.26% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider.


4. Libertex – Trading Tight Spreads Stock CFDs with the Best Broker

Libertex is yet another fantastic trading platform to explore. Libertex has been active since 1997 and now has more than 2.2 million registered users from all around the world. Libertex has a superb reputation as one of the safest platforms for stock dealers, thanks to CySEC supervision. This is aided by a diverse range of tradable assets, which includes anything from shares to cryptocurrencies.

When you place a transaction with Libertex, you will be charged two distinct fees. To begin, when you open a position, you must pay a transaction fee, which varies based on the asset and the amount of the trade. Traders will also pay the spread, which is the difference between the buy and sell prices on an asset, because Libertex is a CFD broker. The amazing thing about Libertex is that the spread on stock CFDs is quite small, usually between 0.1% and 0.2%.

Libertex's minimum deposit is €100 (£85), which may be made with a credit/debit card, a bank transfer, or an e-wallet (such as Skrill). Libertex's web-based platform or mobile app are both available for trading, with full functionality for MT4 and MT5 also available. Finally, Libertex provides retail clients with up to 1:30 leverage on the platform's tradeable CFDs, guaranteeing that potential earnings from trading can be increased.

Pros:

  • CySEC-regulated
  • Competitive spreads from 0.1 pips
  • A wide variety of asset types are accessible.
  • Support for MT4 and MT5t

Cons:

  • On stock CFDs, users must pay a commission as well as the spread.

 66% of retail investor accounts lose money when trading CFDs with this provider.

5. Plus500 – Platform for trading stock CFDs with no commissions

Plus500 is another prominent trading platform that has gained popularity in recent years. This firm, unlike eToro, focuses solely on CFDs. The biggest disadvantage is that you will not be able to own the underlying stock. On the other hand, you'll be able to trade over 2,000 stock CFDs without paying any commissions.

Plus500 lets you use leverage on your stock CFD transactions in the same manner that they let you use leverage on other instruments. A £200 deposit would allow a maximum trading size of £1000 at a 1:5 leverage ratio for retail clients (and higher on other asset classes). When you use Plus500 to trade stock CFDs, you will have the option of placing a buy or sell order. This implies you may bet on the price fluctuating up and down. This is something that a regular stockbroker will not be able to accomplish for you.

In terms of the basics, Plus500UK Ltd is approved and regulated by the FCA (#509909), and its parent business is registered on the London Stock Exchange as a PLC. Plus500 allows you to establish an account in minutes and fund it using a UK debit/credit card, bank account, or PayPal. You'll need to make a £100 deposit to get started.

Pros:

  • CFD platform with no commissions — you simply pay the spread.d
  • There are thousands of financial instruments spread over a wide range of marketplaces.
  • Retail consumers can trade stock CFDs with up to 1:5 leverage.
  • If you believe the value of a stock CFD will rise or fall, you may purchase or sell it.
  • It only takes a few minutes to create an account and make a deposit.

Cons:

  • Only CFDs are allowed.
  • Experienced traders will benefit from this.

 66% of retail investor accounts lose money when trading CFDs with this provider.


Comparison of the Best Brokers

Let's explore how the top UK brokers compare in some important measures now that you know everything there is to know about them.

UK Stock Broker  Fees Min Deposit Margin 
eToro – our recommended choice 0% Commission $10  20%
Alvexo Tight Spreads $250 30%
Capital.com 0% Commission £20 20%
Libertex £2.95 €100 (around £85) 20%
Plus500 0% Commission $100 (around £75) 20%

The Pros and Cons of Shares Trading

Pros:

  • Shares have historically yielded yearly returns of 5% - 8%. That's preferable than a bank.
  • You won't have to wait days to acquire a firm share because of the high liquidity.
  • When the value of the shares rises, you can increase the value of your investment.
  • Dividends provide passive income.
  • Create a diverse portfolio of stocks to reduce your risks.
  • The FCA regulates all of the stock trading platforms included on this website.
  • Some online stock brokers provide commission-free stock purchases.
  • Deposit funds quickly and easily with a UK debit/credit card, e-wallet, or bank account.
  • In 1997, a £1,000 investment in Amazon would currently be worth £2.5 million

Cons:

  • You can end up losing money.
  • You will have to make your own investing decisions.
  • There is no certainty that the value of your stock will rise.

Conclusion

The practice of purchasing shares in the United Kingdom has evolved significantly during the last decade. You no longer need to put your buy and sell orders over the phone with a typical stock broker. Instead, just select a licenced online share trading platform, fund your account using a UK debit or credit card, and then select the equities you wish to purchase. We suggest eToro because it offers no commission trading and a large selection of worldwide stocks

68% of retail investors lose money trading CFDs at this site.

Trading Shares UK - FAQs

Absolutely, the great majority of stock brokers in the United Kingdom provide you with access to both domestic and foreign firms. The NASDAQ and the New York Stock Exchange are usually included at the very least. Brokers such as eToro take it a step further by allowing you to trade in less liquid marketplaces. Canada, Hong Kong, France, and even Saudi Arabia are included.
Stock brokers who service UK clients are regulated by the Financial Conduct Authority (FCA).
You normally have the option of paying with a debit/credit card or transferring money to a UK bank account. E-wallets are also supported by several brokers.
The majority of stock brokers in the United Kingdom charge a fixed fee for each trade you make. This implies you'll have to pay the same charge when you acquire shares and when you sell them. Brokers like eToro, for example, occasionally enable you to acquire shares without paying any fees.
You'll need to find an internet broker who has a direct AIM connection. If they do, you'll be able to purchase and sell AIM shares with a single click.
Companies can raise funds by selling shares. These businesses might put the money into research and development or new ventures. Through an Initial Public Offering, a firm will list its stock on a stock market such as the NASDAQ or the London Stock Exchange (IPO). Investors who purchase stock become shareholders, with the ability to vote and receive dividends.
The total declared dividends given to shareholders for all outstanding shares are referred to as DPS, or dividend per share. Divide the total dividends by the number of outstanding shares issued to arrive at the DPS.
Some IPOs are available through top-tier internet brokers such as TD Ameritrade, Fidelity, and Charles Schwab. Once you've met the requirements for an initial public offering, you'll need to submit a request for shares in the IPO. You'll be given a deadline to submit your shares order once the IPO 'prices.' You won't know if you were able to purchase shares in the IPO until after your order has been fulfilled.
Direct investing allows you to acquire shares online without using a broker. This implies you'll be purchasing stock from a publicly traded corporation directly. Coca-Cola and Walt Disney, for example, allow investors to trade shares in their companies without the need of a third-party middleman.

Disclaimer: Investing in stocks has a high risk of loss and is not appropriate for all individuals. Before purchasing shares, you should carefully evaluate your investing objectives, degree of expertise, and risk appetite. Above all, never invest money you can't afford to lose.

James Karl author check sign Pro Investor

James Karl is a British researcher and writer that specializes in finance, financial crime, and blockchain technology. Now based in Malta, Kane writes for a number of platforms in the online domain. In particular, Kane is skilled at explaining complex financial subjects in a user-friendly manner.