Are you looking for the best online brokers in Australia? Thanks to the rise of online share trading platforms in the past couple of decades, it’s now easier than ever to buy shares online or on your mobile phone.
But with so many options to choose from, you'll want to make sure you're picking the right one for you. Our guide covers everything you should consider when comparing investment apps, including fees, trading options and support features.
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There are plenty of things you'll need to consider when looking at different platforms, however it all comes down to how you're intending to use it. Ask yourself, do you want to buy Australian shares or are global shares important too? And do you consider yourself to be a beginner or an advanced investor?
The fees. Almost every online trading platform will charge you a brokerage fee when you buy or sell shares, ranging from around $10 to $30 per trade. However, fees may be calculated as a percentage of the transaction amount for larger trades and may also be lower depending on how frequently you trade. Some providers also charge ongoing subscription or inactivity fees on top of this, especially with the more feature-dense platforms.
What can you trade? Some trading platforms will not only give you access to Australian shares but also international shares. Others will also allow you to trade CFDs, forex, indices, currencies and much more, so look for this functionality if it's important to you.
Ease of use. Share market trading can be complicated and often requires you to respond quickly to market changes. With this in mind, look for a platform that allows you to make fast and precise trades with minimum fuss.
Access to market data and research. Does the platform offer dynamic, real-time or delayed market updates? Some platforms offer research and broker analysis on individual stocks that can come in handy.
Trade options. Consider the options available when you are buying or selling shares. Can you place orders at market and/or at limit, and are stop/loss orders an option to add more flexibility to your trading?
Reporting. Check what reporting tools each platform offers to help you track how your trades are performing, record dividends and pass on any relevant information to the ATO at tax time.
Margin loans. If you're looking to borrow money to build your portfolio, check to see whether the platform provider offers margin loans.
Customer support. Look for phone, email and live online chat support. Do they offer customer service 24/7 if you're having trouble placing a trade?
Education. Some platforms also feature a range of educational tools and resources, such as how-to guides and webinars, to help you get more out of your trading account.
Security. How secure is the platform and what measures are in place to ensure the safety of your funds?
Find the best share trading platform to suit you
How can you choose a share trading platform that's right for you? Ask yourself the following questions:
What type of trader am I? Are you a casual trader, an active trader or an expert investor? This will influence the features you're looking for in an online broker and their trading platform. From the ease of use of the system through to the market research information available, it's critical that the trading platform complements your trading needs.
How often will I trade? If you buy or sell shares once or twice a month (or even less), you’re most likely a casual investor. The more you trade each month, the more likely you are to need a share trading platform that offers an extensive range of features and expert analysis. Some platforms charge inactivity fees or higher broker fees if you don't place a minimum number of trades per month, quarter or year.
How will I place trades? Will you be placing all your trades online, via a mobile app or over the phone? Check the fees charged for the different ways to place trades.
What will I be trading? While shares are the most commonly traded security, you can also trade a wide range of other securities through online brokers. Consider whether you want access to international shares, forex and CFDs as well as Australian stocks.
How much does it cost? As well as ongoing fees, consider the brokerage fees that apply to your transactions and whether they may be waived or reduced if you satisfy certain criteria, such as placing a specified number of trades each month.
What fees will I pay to trade shares?
There are two main fees that commonly apply when you use online share trading platforms:
Brokerage fees. Brokerage fees are the charges that apply to each buy and sell transaction, and they usually vary depending on the size of your buy or sell order or how often you trade.
Ongoing fees. These apply monthly or annually, but not all providers will charge ongoing fees. This may depend on how frequently you trade, for example inactivity fees are often charged if you don't place any trades within a certain period of time.
Brokerage fees vary greatly between providers but typically start at around the $10 to $20 range. For large transactions, fees of around 0.1% and up usually apply. If you’re planning on making lots of trades, you’ll want to keep an eye out for a platform that offers low per-trade fees.
Some providers will not charge any monthly fees at all. However, more advanced trading platforms and those that offer premium services will often charge a monthly fee that could be as high as around $80 per month. A number of brokers will waive this fee if you perform more than a certain number of trades each month.
Finally, remember that many brokers offer different membership levels – for example gold, silver and platinum – which offer different features and therefore attract varying fees.
What companies offer share trading platforms?
The table below contains details of the fees charged by a selection of share trading platforms and accounts in Australia. Keep in mind that some of these platforms are geared towards casual investors while others are designed for experienced investors.
Control your investments. Online brokers give you the ability to take charge of your finances and invest your money in a range of local and global financial instruments.
Convenient. You can trade shares and boost your investment balance all from the comfort of your own home. Trading shares online can require much less legwork than for example, investing in property.
Affordable. The online share trading sector is becoming increasingly competitive, which is great news for consumers because it means better features and lower fees. The cost of buying and selling shares online has dropped markedly over the past couple of decades.
Information at your fingertips. Many share trading platforms give you access to a wealth of market news and company information to help you make informed trading decisions.
Risks of using share trading platforms
Lack of knowledge. The fact that you get to take full control of your investments can be a double-edged sword. While it allows you to take charge of your finances, it also means that you must rely on your own know-how to buy and sell shares. If you don’t know what you’re doing you can lose a significant amount of money.
Temptation to take risks. When you’re able to buy and sell shares in just a few quick clicks, it can be easy to forget that you’re dealing with real money and not just playing a game. Remember, these are serious financial decisions you are making and all trading carries a degree of risk.
Error. A simple typo and a failure to proof-read any buy or sell orders before you place them could cost you a lot of money. Review your orders closely before you submit them.
How do I apply for a share trading platform?
Once you’ve found the right online share trading platform, it’s quick and easy to apply for an account. If the platform is run by your bank and you already have an internet banking account, there’s often very little you have to do except deposit funds into your share trading account and start placing orders.
If you’re signing up for an account with a new provider, however, you’ll generally need to provide the following details:
Your name, address and contact details
Your tax file number
Your driver’s licence number
Your linked bank account details
Once you’ve deposited funds into your account – a minimum deposit amount may apply – you're ready to start trading.
Ready to start trading shares?
Once you've found a share trading platform and you're ready to start investing, it's actually quite easy to get started buying and selling shares. Read our guide on how to buy shares online here for a step-by-step guide to buying shares.
Share trading glossary
ASX: This is the abbreviation for the Australian Securities Exchange
All Ordinaries: This is an index of the performance of the share prices of around 500 of Australia’s biggest companies. Also referred to as the All Ords
Bear market: This term refers to when prices on the market are falling and further falls are expected to occur.
Blue chip stock: A blue chip stock is a large company with a steady history of turning a profit
Brokerage fee: This is the fee you must pay to a share trading platform when you use the platform to buy or sell shares
Bull market: This term applies when share market prices are rising and expected to continue to rise
CHESS (Clearing house electronic sub register system): This ASX system settles share trades and acts as the central registry for the electronic transfer of share ownership
Contract note: This confirms a buy or sell transaction and includes details such as the type of share, the price paid and the quantity traded
Dividend: Companies can distribute their profits or earnings to shareholders in the form of dividends. A dividend is calculated as a number of cents for each share you own
Float: The initial raising of capital through public subscription to a security
Fundamental analysis: This involves analysing the financial statements of a business to determine its overall financial standing.
Futures: Futures are contracts to buy or sell an asset at a specified future date
Limit order: A limit order specifies the maximum (when buying) or minimum (when selling) price you are willing to accept for a share transaction
Listed company: Listed companies have shares that are purchased and sold through the ASX
Live price: This is the price of a share at a precise moment in time
Market order: A market order is an order to buy or sell a share at its current market price
Short selling: This is when you borrow a security and subsequently sell it, with the obligation to buy it back in future at a much lower price
Volatility: This reflects the amount of fluctuation in share prices
Warrant: This gives its holder the right to purchase a security at within a certain timeframe and at a specific price
Yield: This is your return on an investment and is expressed as a percentage
Frequently asked questions about share trading platforms
The minimum amount of shares you can purchase in a company is $500.
When you place a buy or sell order, you will need to select whether you want to place it ‘at market’ or ‘at limit’. Market orders will be executed at the best available price on the market at the time the order is lodged, while limit orders allow you to set a maximum (when buying) or minimum (when selling) price limit for your transaction. If your limit price is never reached on the market, your order will not be executed.
Yes, some providers will allow you to open a demo account which allows you to trade dummy shares and get a feel for how the system works. This can be a great way to determine whether a certain platform is right for you.
Many ASX companies will pay dividends to their shareholders twice a year. Dividends are your share of the company’s profits or earnings and are usually paid as a number of cents per share you own. However, it is not compulsory for companies to pay dividends from their earnings and they may choose to reinvest those earnings back into the company.
There are a couple of ways in which you can generate wealth through shares:
Through a rise in the price of the shares you own, allowing you to sell them for profit
Through a company’s profits and earnings which they pay out as dividends to shareholders
Diversifying your share portfolio basically means spreading your share purchases across a wide range of business and industries to minimise your risk. For example, if you only have shares in a few companies that all operate in the manufacturing sector, you could be risking significant losses if the manufacturing industry suffers a downturn. But if you purchase shares in businesses across a wide range of industries, this spreads your risk out across different market sectors and can help safeguard your money.
Blue chip companies are large companies that regularly turn a profit. They are featured in the ASX Top 50 list and include companies like BHP and Telstra.
These are Commonwealth Bank’s CommSec, ANZ Share Investing, nabtrade and Westpac Online Investing.
When compared to the cost of investing in property, for example, shares are relatively cheap. They’re flexible, allowing you to buy and sell whenever it suits you and potentially make quick profits, plus they can be sold quickly and easily if you need quick access to funds. Finally, you don’t need a large amount of money to get started in shares, with the minimum trade limit set at $500.
Not particularly. Buying or selling is simply a matter of indicating how many shares you wish to purchase or sell and specifying whether you want to place a market order or a limit order.
Yes, depending on the share trading platform you choose and possibly on the level of membership you choose, you may very well be able to access expert stock recommendations.
Every online share trading platform will need to detail the fees that apply to members and transactions, both in terms of ongoing fees and brokerage fees per transaction. Read the fine print of your chosen platform to make sure you’re aware of all fees and charges that may apply to your trades.
Yes, some online share trading platforms will also allow you to trade international shares.
You’ll have to check the terms and conditions of your chosen online broker, but in most cases it is no problem to establish a joint account and start trading.
Yes you can, as long as the order is still open and has not been executed. However, keep in mind that market orders are placed instantly, so this really only applies to at limit orders.
The best approach to improve your trading skills is to research, research and research. From trading strategies to financial news, company announcements and market activity, staying up to date with anything and everything related to your planned trades and the share market in general could help increase your levels of success. There are also plenty of courses you can take to learn the ins and outs of online trading. Make sure you only study with a trusted education or training organisation.
The best place to go for information on the Australian Stock Exchange is asx.com.au.
Yes, there are two main approaches to borrowing money to purchase shares:
Margin lending. This is offered by some banks and large stockbroking firms and involves using your existing, shares or managed funds as security.
Using the equity in your home to take out a loan for investment purposes.
Unsecured loans, although these will have high interest charges.
However, remember that there are many risks associated with borrowing money for an investment on which returns are far from guaranteed.
Belinda Punshon is Finder's corporate communications executive, and previously worked as a writer on home loans and property. She has a Masters in Advertising, Public Relations and Journalism from the University of New South Wales and a Bachelors in Business from the University of Technology Sydney.
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