With all the share trading platforms on the market, finding the right broker can be difficult.
But in Australia, there's an additional consideration of whether to choose CHESS or a custody model.
If you are considering signing up to a broker, Finder, using our proprietary algorithm, has come up with a list of CHESS-sponsored brokers worth considering.
We use our proprietary algorithm in order to give each trading platform a score.
Set up by Finder's data scientists and investment experts, our algorithm takes into account broker fees, trading tools, educational resources and the list of available stock markets on each platform.
Our methodology to select the best CHESS-sponsored brokers rated platforms on the following features:
Availability of ASX CHESS-sponsored equities (Y/N filter)
Order types offered including market order, stop loss and other conditional orders
Research tools including broker ratings, PE ratios, dividend tracking and tax reporting features
Brokerage fees for Australian shares and ETFs
Platform fees including withdrawal fees and inactivity fees
Availability on desktop and mobile
Average user rating
Important: Bear in mind, there's no trading platform that's best for everyone as all our needs are different. What's best for you might not be best for someone else. However we hope this guide can help you to narrow down your options, regardless of your trading style or level of experience. If you're looking for more details, see our full methodology here.
Our top pick for a CHESS-sponsored broker is CMC Invest. In fact, it recently took out our award for best overall trading platform. CMC offers clients a range of financial options for less. For those looking to trade CHESS-sponsored shares, they offer free brokerage on trades under $1,000.
$0 brokerage on ASX trades under $1,000.
Comprehensive analysis tools for Australian equities.
Access the Cboe and SSX exchanges.
Hefty phone brokerage fees
Higher fees if you trade in some countries.
Brokerage fees: AU stocks: $0 brokerage (for buy orders up to $1,000) and $11 or 0.10% (whichever is greater) for all other buy and sell orders. US stocks: US$0 UK stocks: £0 ETF brokerage fees: AU ETFs: $0 brokerage for trades up to $1,000 (applied to the first buy order per ETF per day). $11 fee for trades up to $10,000. $15 fee for trades equal to or greater than $15,000. US ETFs: US$0 Options: ASX: $33/contract US: Not available Other markets available: Details here Inactivity fee: $0 Currency conversion fee: 0.60% of trade value
Selfwealth is a low-cost broker that runs off a flat-fee model. This makes it incredibly appealing to those trading larger amounts of money. But the broker goes beyond just flat fees, offering investors a number of features including copy trading and stock analysis tools to help them get ahead.
Low brokerage fees
Copy trading accounts
Strong stock analysis tools
Limited trading options
Brokerage fee per trade: AU stocks: $9.50 flat fee US stocks: US$9.50 flat fee Other markets available: Details here ETF brokerage fees: AU ETFs: $9.50 flat fee US ETFs: US$9.50 flat fee Other markets available: Details here Inactivity fee: $0 Currency conversion fee: 60 bps of trade value
CommSec is arguably the best-known share trading platform in Australia. It is the benchmark when it comes to a number of features, including educational resources, technical analysis tools, built-in broker recommendations and, of course, CHESS-sponsored shares.
Strong news and research ideas
User-friendly, especially for mobile
Data and monitoring tools
No inactivity fees on Australian holdings
Not the cheapest broker around for global stocks
No live chat support
Brokerage fee per trade: AU stocks: $5.00 (up to $1,000 trade value); $10.00 (over $1,000 up to $3,000); $19.95 (over $3,000 up to $10,000); $29.95 (over $10,000 up to $25,000); 0.12% (over $25,000) US stocks: USD$19.95 for trades up to USD$5,000; USD$29.95 for trades up to USD$10,000; 0.31% for trades above USD$10,000 USD$39.95 or 0.40% (whichever is greater) Inactivity fee: $0 Currency conversion fee: 0.55% of trade value
HSBC Invest offers a high quality trading platform for CHESS sponsored shares with plenty of research tools to keep you interested, including broker ratings, dividend search tools, technical analysis charts and a news feed.
Offers ASX stocks, ETFs and mFunds, ASX options available, High quality research tools
No global stocks, Brokerage fees higher than others, No fractional stocks
Brokerage fee per trade: AU stocks: $19.95 per trade (up to $20,000); 0.11% for trades over $20,000 US stocks: Not available UK stocks: Not available Options: ASX: $30 US: Not available Inactivity fee: $0
You can trade ASX CHESS sponsored shares as well as global stocks using the Westpac Share Trading account. Great quality research tools and expert analysis specifically honed for Australian equities make Westpac a top contender for ASX traders.
Trade Australian and global shares, ESG ratings available, Good range of research tools
Brokerage fees higher than others, No auto-invest feature, No fractional stocks
High minimum investment of $500
Brokerage fee per trade: AU stocks: $4.95 (trades up to $1,000); $9.95 (trades $1,000 - $3,000); $19.95 (trades $3,000 - $10,000); $29.95 (trades $10,000 - $28,000); and 0.11% of trade volume (trades over $28,000). US stocks: USD$19.95 (trades up to USD$5,000); USD$29.95 (trades up to USD$10,000); 0.31% of trade volume (trades over $10,000). Other markets: Details here ETF brokerage fees: AU ETFs: $4.95 (trades up to $1,000); $9.95 (trades $1,000 - $3,000); $19.95 (trades $3,000 - $10,000); $29.95 (trades $10,000 - $28,000); and 0.11% of trade volume (trades over 28,000). US ETFs: USD$19.95 (trades up to USD$5,000); USD$29.95 (trades up to USD$10,000); 0.31% of trade volume (trades over 10,000). Other markets: Details here Inactivity fee: $0 Currency conversion fee: 0.60% of trade value
Stake is the cheapest broker on the market for those investing in ASX CHESS stocks and ETFs, charging just $3 brokerage per trade. As such, it's no surprise it makes our list. Better still, if you refer 3 friends, you can actually get free brokerage on ASX trades for a year.
User-friendly options
Cheap brokerage
Refer-a-friend bonus
Offers both ASX and US stocks
Having to pay for advanced tools through Stake Black
Fewer features than others
Brokerage fees: AU stocks: $3 (Up to and including $30,000); 0.01% (Over $30,000) US stocks: US$3 (Up to and including $30,000); 0.01% (Over $30,000) Other markets: Details here ETF brokerage fees: AU ETFs: $3 US ETFs: US$3 Inactivity fee: $0 Currency conversion fee: 70 pips (US$0.70 for every AUD$100 exchanged)
Moomoo is a low-cost, feature-packed investing platform that should suit a range of investors. Its recent launch of CHESS-sponsored trading is another advantage to its offering. You can trade Australian and international stocks as well as ETFs and fractional shares for low-cost brokerage while benefiting from moomoo's extensive charting and analysis tools.
Access Australian, US and Hong Kong stock markets
Low commission trades
Social and paper trading available
Extensive charting and research tools
No access to European stocks or Asian markets beyond Hong Kong
No access to crypto or forex markets
Brokerage fees: AU stocks: $3 or 0.03% of transaction value (GST inclusive), whichever value is larger US stocks: US$0.99 UK stocks: Not available ETF brokerage fees: AU ETFs: $3 or 0.03% of transaction value (GST inclusive), whichever value is larger US ETFs: US$0 Inactivity fee: $0 Currency conversion fee: 55 pips or 0.0055 AUD/USD
What are HIN and CHESS?
If you have a CHESS-sponsored broker, you'll also have a HIN with it.
That is because in order to register shares in your name, the CHESS-sponsored broker must issue a Holder Identification Number (HIN).
Think of a banking account.
It is remarkably similar to this.
If you decide to change brokers, this HIN will follow you around as long as the next broker you join is also CHESS sponsored.
Custodial share trading model
When you sign up to a broker, they'll either run off a CHESS-sponsored or custodian model.
A custodian model basically means the custodian is the legal owner of the shares. This means that the broker owns the shares, not you. You are still a beneficial owner though, meaning you get the same dividends and capital gains. You just don't have the voting rights of CHESS shareholders.
The upside for this model is it is usually cheaper on fees.
The downside of a custodian model is that you have less direct control over your investment and less access to your holdings. Although it is worth pointing out that the entire US system works off a custody model.
Pros and cons of CHESS-sponsored shares
Pros
Let's start out with the good.
Direct ownership. With a CHESS-sponsored system lodged with the ASX, you're the legal owner of the shares because of your HIN.Your broker or trading platform simply acts as a middleman between you and the exchange. This means, if the broker happens to go under, your share ownership and the holdings themselves won't be impacted. You can simply shift your holdings over to another platform to continue trading.
Voting rights on shares. Another handy reason to go with CHESS-sponsored shares is that you'll be offered voting rights. As a company owner, you have the right to attend general meetings and to make decisions on directors' remunerations and other key factors that drive business performance. On the other hand, custodial brokers decide whether they wish to pass voting rights onto you or not.
Easier to switch brokers. If you decide to switch brokers, having your shares with a HIN can be incredibly handy. It typically means you'll just need to complete a 2-page online form and your shares will be sent, usually within a week. A custodian broker usually takes a little bit longer to sort out.
Did you know: Recent Finder research found that the average share trader could save approximately $1,048 in brokerage fees a year by switching to a more suitable online broker (calculated on 7 trades per month of $1,000). You might even save money by having more than 1 platform, especially if you are investing in both Australia and internationally.
Cons
Of course, there are some downsides to choosing a CHESS-sponsored model.
Lacks access to international markets. If you're looking to invest around the world, then the CHESS model won't help you since it is an Australian system. In fact, most of the world's largest share markets, including the US, run off a custodial model.
Higher fees. Now this will vary greatly depending on who you actually sign up with, but custodian models can mean cheaper fees for investors. This is one of the major reasons why investors choose them over CHESS sponsorship.
Fractional shares. Under a custodian share model, you can buy and sell fractions of shares, rather than a whole share. This can help you start out sooner especially when you're buying stocks that are hundreds of dollars per share.
Indirect share ownership. Given you aren't the holder of the shares, the custodian broker will do the administration on your behalf.
If you are unconvinced, here's a list of all brokers
Superhero has dropped its brokerage fee from $5 to $2 for trades up to $20,000 on ASX-listed shares.
Vanguard Investment Australia was found to have made false or misleading representations about ESG exclusionary screens applied to its index fund product in a greenwashing case brought against it by ASIC.
Australian trading platform Superhero has added a new AI feature that quickly summarises ASX company announcements selected by users.
ETF provider Betashares has launched a $0 brokerage investment platform that lets you buy units in individual ASX-listed ETFs or auto-invest into ETF portfolios.
The criminal trial against Sam Bankman-Fried (SBF), the founder of disgraced crypto exchange FTX, starts in the first week of October. SBF is alleged to have defrauded customer funds for his own use in business operations and political donations.
Interactive Brokers Australia has been slapped with an $832,500 fine by ASIC for failing to identify suspicious trading activity by one of its clients.
Sharesies has introduced a new monthly fee structure of $5, $10 or $20 per month for unlimited trades up to a certain amount. Alternatively, you can still pay as you go.
Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involve substantial risk of loss and therefore are not appropriate for all investors. Past performance is not an indication of future results. Consider your own circumstances and obtain your own advice before making any trades.
Cameron Micallef was a utilities writer for Finder. He previously worked on titles including Smart Property Investment, nestegg and Investor Daily, reporting across superannuation, property and investments. Cameron has a Bachelor of Communication and Media Studies/ Commerce from the University of Wollongong. Outside of work Cameron is passionate about all things sports and travel.
There are more than 100 banks in Australia and new ones pop up all the time. So how do you know what one to pick when you come from overseas? Finder has pooled all the information together to help you compare.
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