In the past, I’ve often dismissed investing in individual stocks and shares entirely.
This is largely because I’m a big fan of index fund investing.
However, part of this was that I was more comfortable with the principles of index fund investing compared to individual companies. A lot goes into stock picking and it’s an area I’ve been learning more and more about. It’s one of those areas where you can always be learning more and there’s also always somewhere out there who knows more than you. It’s humbling but interesting.
Many people getting started with investing like the idea of putting money into individual companies and buying shares. As long as this is done sensibly, it can be a good way to gain a better understanding of how the market works. Even if the end result is that it encourages you more into something like index fund investing, it can still be good experience.
With that in mind, I’m going to talk about my favourite place right now to buy individual stocks and shares.
Where is the best place to buy stocks and shares?
Investing has been a relatively expensive endeavour for investors in the UK for many years. Things are gradually changing.
I’ve always been a big fan of Vanguard because they offer a really cheap way to invest in index funds.
Sadly, many investment companies charge a hefty premium for investing in individual stocks and shares.
Thankfully a new player has entered the game. They’ve been around for a little while now and are constantly growing their services and offerings but I’ve become really impressed with everything they’re doing.
That company is Freetrade.
Why is Freetrade a good place to invest?
Cheap is good but free is even better.
As the name eludes, Freetrade lets you buy shares and funds with zero commissions charged. This can be a great way to trade inexpensively if you’re just getting started with investing and want to learn through first-hand experience.
I actually wrote a review for Freetrade for The Motley Fool and I was really impressed and have since used their platform myself for occasionally trading. (https://www.fool.co.uk/mywallethero/share-dealing/reviews/freetrade/) I’ve also written articles about Freetrade’s top investment trusts and their top investing tips.
Along with free trading, their platform is really nice and simple to use. If you can use something like Netflix, you’d cope fine with Freetrade.
Although the general Freetrade account is free, they charge for a premium version which has more features and access to more investments. The free account still lets you pick from thousands of investment options and for a beginner, this is ample choice.
What are the downsides to Freetrade?
No company is perfect.
As I just mentioned, Freetrade do have a tiered pricing system if you want an account with all the bells and whistles. Having to pay for an ISA and a SIPP is a big bummer for me.
You can still get by with plenty of investment options on the free account. It’s worth remember you have a Capital Gains Tax Allowance of £12,300 currently. This means you can make up to this amount with a general account before paying CGT.
So if you’re just dabbling with low amounts, the free account could do you just fine. If you’re investing larger amounts then it may be worth paying for the tax-efficient ISA features.
Another thing I don’t like about Freetrade is that it takes a couple of hours to deposit funds into the account. Which is a pain if a stock drops and there’s a temporary buying opportunity at a low price.
How can I get started with Freetrade?
If you use this link when you sign up you’ll get a free share valued up to £200 absolutely free. I’ll also get a free share, so we’ll both get something!
It’s a really simple sign up process and like I said, it’s dead easy to use the platform.
Just keep in mind that investing carries obvious risk, especially when it comes to individual companies and there’s no guarantee you’ll make money. Freetrade do offer access to different types of investment funds as well which can be a bit more stable but still carry risk so do your research and invest wisely!