How to open a share trading account

If you want to invest in shares, you'll need to sign up to a stock broker. You have two choices here – you can hire the services of a traditional full-service broker or you can do the trading yourself through an online broker (aka share trading platforms).

Online brokers allow you to buy and sell shares in publicly listed companies over the Internet. Where previously you needed to call up a broker to buy and sell the shares for you, these days investors can trade directly by opening an online share trading account for a much lower cost.

This guide allows you to easily compare online share trading accounts, and takes you through the steps involved when choosing a platform.

Steps to open a trading account

1. Choose a broker
2. Select your membership level
3. Provide ID
4. Link bank account
5. Submit application
6. Start trading

Share Trading Account Offer

IG Share Trading Offer

AUD 8

Standard brokerage - Australian shares

Share Trading Account Offer

Competitive broker fees on Australian shares, international shares, forex and CFD trading.

• Brokerage - AU shares: From AUD 5 or 0.05%
• Brokerage - US shares: USD 0
• Sign-up process: Instant
• Support - After hours: Yes

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Important: Share trading carries risk of capital loss.

Open a share trading account today

• Share trading

Important: Share trading can be financially risky and the value of your investment can go down as well as up. Standard brokerage fee is the cost to trade $1,000 or less of ASX-listed shares and ETFs without any qualifications or special eligibility. If ASX shares aren’t available, the fee shown is for US shares.

Why trade shares online?

When people think of share trading, many still imagine a crowded and chaotic trading room floor. The reality is that thanks to modern technology, the vast majority of share trading is done online. According to a report from Investment Trends, the number of active Australian online share investors grew from 595,000 in November 2014 to 635,000 in May 2017.

Trading shares online offers a secure and easy way to manage your investments. You can place trades at a time and place convenient to you, while buying and selling shares offers the potential to benefit from share price increases and also enjoy an income from dividend payments.

There are of course risks attached to trading shares, including the potential to lose the money you invest, so it’s important to make sure you’re aware of those risks before you start trading.

See the finder.com.au share trading guide.

How do I choose an online share trading platform?

You'll need to carefully consider your trading needs before deciding on the right online share trading platform. Some of the issues to consider include:

• Trading knowledge and experience. Some online share trading platforms, for example CommSec and SelfWealth, are designed to suit retail investors, rather than institutional investors and traders. Other trading platforms have special features geared towards highly experienced traders, such as advanced charting tools, speedy execution of trades and live market data. These features may come at a cost, however, and may not add much value if you are a less experienced trader.
• Available markets. Some share trading platforms only provide access to companies listed on the Australian Securities Exchange (ASX) while others will also allow you to place trades on international markets. Some trading platforms will also provide access to other trading instruments, for example forex and contracts for difference (CFDs).
• The fees involved. There are two main costs you need to consider when choosing a share trading platform: the brokerage fee and the ongoing fee. The brokerage fee applies each time you place a trade and is usually around $10-$25, but could be higher based on the size of the transaction. Ongoing subscription fees are charged monthly and vary depending on the provider and the account features you select.
• Trading resources. From educational tutorials to research and investment advice, check what tools a platform offers to help you make informed trading decisions.
• Customer service. If you ever have a problem or need help with a trade, check to make sure you will be able to access prompt and helpful customer support.

It’s also worth pointing out that it can be a lot easier to open a share trading account if you're an existing customer of the same financial institution; for example if you’re a CommBank customer opening a CommSec share trading account. In this case, you won’t have to provide your name, contact information or proof of ID.

Did you have these enquiries about opening a share trading account?

• Do I need to be an Australian resident to sign up for a share trading account?

  This depends on the share trading platform you select. Some are only open to Australian residents while others accept customers from all over the world.

• Is it free to sign up for a share trading account?

  Some share trading platforms don't charge anything to open an account. However, other platforms that offer in-depth research and dynamic market data often attract monthly fees. Make sure you're also aware that a brokerage fee will always apply when you place a trade.

• How can I buy shares online in Australia?

  Check out our step-by-step guide to buying shares online for all the information you need to get started.

• Can I place trades over the phone?

  Yes, many online share brokers also offer a phone trading service.

• Do I need to open a share trading account to buy shares?

  Not necessarily. You can buy shares in a float (also known as an initial public offering or IPO) by filling out an application form in the prospectus and paying by cheque, while it's also possible to purchase shares through a managed fund. You may even be able to purchase shares in the company you work for as part of an employee share scheme.

• Do I need to buy shares through a broker?

  Not necessarily. As per the above question, you can also buy shares through an IPO, managed fund or employee share scheme.

• Can I open a joint share trading account?

  Yes, many platforms will allow you to open a joint account.

• Do the “Big Four Banks” all have their own share trading platforms?

  Yes. These are CommSec, ANZ Share Investing, nabtrade and Westpac Online Investing.