• BullsEye Investors

Best UK Stockbrokers: A Guide for 2022

Updated: Feb 5

If you are based in the UK and are looking for the best stockbroker to kick-start your investing or trading journey then look no further!


There are certainly plenty of stockbrokers out there for you to choose from. From Interactive Investor to Hargreaves Lansdown to Trading 212; each offers something different.

As part of this episode of BullsEye Insights we explore the pros and cons of the leading UK-based stockbrokers, plus a few lesser known options, available to private investors in 2022.


Whether you already have an existing stockbroker and are looking to switch, want to explore the alternatives, or are looking to reduce your trading costs by finding a cheaper option, this handy guide will give you a whistle-stop tour of the main contenders.


Hargreaves Lansdown

Hargreaves Lansdown image

It is only right that we start with one of the largest stockbrokers in the UK - Hargreaves Lansdown.


Founded in 1981, Hargreaves Lansdown is listed on the London Stock Exchange and is regulated by the FCA. Many investors see this stockbroker as a safe choice because of Hargreaves Lansdown's long track record, and we could not agree more.


There are many benefits associated with playing it safe with Hargreaves Lansdown. They offer excellent customer service, high-quality educational tools, trading and investing tips and easy-to-use trading platforms - both online and through their mobile app.


In terms of coverage, Hargreaves Lansdown offers a broad assortment of investing products and services, including Stocks and Shares ISAs, standard Trading Accounts and Self-Invested Personal Pensions (SIPPs), as well as a growing selection of accounts for children, such as a Junior Stocks and Shares ISAs, Investment Accounts and SIPPs.


Hargreaves also performs strongly when it comes to coverage of tradable assets. Through an account with Hargreaves you can trade a broad selection of UK and international stocks, Exchange Traded Funds (ETFs), bonds and investment trusts. If you are UK based stock market investor, you're pretty much covered!


On the negative side, the fees for trading with Hargreaves Lansdown are quite high (at £11.95 per trade when making less than 10 trades per month) when compared with other stockbrokers. The trading fees do reduce the more you trade, however, if you aren't an active trader, you are unlikely to feel this benefit.


In addition the product fees charged by Hargreaves are also quite steep. Rather than charging a fixed fee, Hargreaves charge an annual fee of 0.45% of the value of shares held in ISA accounts. In addition, if you invest in mutual funds within your ISA, Hargreaves will charge an additional 0.45% of the value of your mutual fund holdings up to £250k, 0.25% between £250k and £1 million and 0.10% on balances between £1 and £2 million.


Therefore using an example, if your ISA holds £50k in shares and £20k in mutual funds, your annual ISA charge will be:


Mutual Funds: £20,000 at 0.45% = £90

Shares: £50,000 at 0.45% = £225

Total = £315 per annum


And that's before you factor in the impact of any growth to your ISA balance... and of course, trading fees!


Reliability and coverage of account types and tradable assets is key to your choice of broker, but product and trading fees should also rank highly when deciding which stockbroker is right for you. After all, paying your stockbroker more in fees will ultimately chip away at your investing returns!


BullsEye's verdict:

⭐⭐⭐⭐


😍 Easy to use trading platforms (mobile apps and online portal)

😍 Strong track record

😍 Strong product and service offerings - ISAs, SIPPs, trading accounts and children accounts

😍 Strong coverage of tradable assets, including international stocks

🙁 Product fees are relatively high compared to other brokers that offer fixed fees

🙁 Trading fees are relatively high compared to other brokers

 

Interactive Investor

Next, we have the second biggest stockbroker in the UK - Interactive Investor.


Interactive Investor was founded in 1995 and it is also regulated by the FCA. It provides a treasure trove of stock market information to its customers, as well as tools to help you make investment decisions. Interactive currently has £30 billion of assets under its administration, with over 300,000 customers and more than one million users. The group is based in Manchester, with offices in London and Leeds. Similarly to Hargreaves Lansdown, Interactive Investor has a great track record and is an established brand name, so you can have relative peace of mind if you decide to go with Interactive Investor.


Some of the reasons why Interactive Investor is such a good choice include the fact that deposits and withdrawals are quick and easy. Plus, the trading platform (both mobile app and online portal) is incredibly user-friendly. One of the positives which sets Interactive Investor apart is that it offers excellent customer service over the telephone - and this is not something to be taken for granted as not all stockbrokers offer this contact option. Typically, it is limited to live chat or email support!


Interactive Investor also has a strong product offering - Stocks and Shares ISAs, SIPPs, trading accounts, as well as a strong set of products for children, similar to Hargreaves Lansdown. And their coverage of tradable assets is also strong, with coverage across shares, both UK and international, mutual funds, ETFs and investment trusts. The only real drawback of opting to use Interactive Investor is that their analytics and charting tools could do with an upgrade.


In addition, Interactive Investor's product and trading fees are extremely competitive. For example, you can open an ISA and trading account together for a flat fee of £9.99 per month, regardless of your account balance. This means you know what you are paying in product fees regardless, and you aren't penalised if your investments grow. Trading fees are equally competitive - the first trade each month is free and thereafter fees are £7.99 per trade. In addition, Interactive Investor are currently offering new customers to open up a SIPP with no fee for the first six months, and then £19.99 per month thereafter.


BullsEye's verdict:

⭐⭐⭐⭐⭐


😍 Easy to use trading platforms (mobile apps and online portal)

😍 Strong track record and product and service offerings - ISAs, SIPPs and trading accounts

😍 Strong coverage of tradable assets, including international stocks

😍 Product and trading fees are flat and extremely competitive, with fee-free periods for SIPP customers

🙁 Research tools not well suited for advanced research and charting

 

IG

Another platform that we recommend when it comes to stockbrokers in the UK is IG.


IG, which was founded in 1974 and is one of the world’s biggest Contract For Difference (CFD) brokers. IG has been regulated by a number of bodies around the world, which includes the FCA in the UK.


There are many reasons why IG is considered one of the better stockbrokers out there for more experienced traders and investors, or for those investors looking for a managed investment service that doesn't cost the world.


IG's educational tools are exceptional and the trading platform itself is also great to use. Although the IG product offering is slightly more limited in terms of the different types of accounts it offers, it stands out as a front-runner when it comes to active trading and for those that want to try CFDs or 'spread-betting'. These products are not suited to inexperienced investors, or those with low risk appetites. But for those that are interested IG does offer some attractive accounts in this space.


IG also offers passive investors a cost-effective alternative to the traditional wealth managers, known as the IG Smart Portfolio. IG Smart Portfolios are expertly managed, broadly diversified portfolios with exposure to many global markets, such as fixed income and stocks, along with alternative investments like gold and property. At a fraction of the cost of traditional wealth managers, the IG Smart Portfolio is designed to help you reach your financial goals sooner. Your portfolio will be built to suit your risk appetite too, which we love at BullsEye Investors.


IG does offer standard trading accounts and ISAs, and its trading fees are relatively competitive. For example, IG charge 0% commission on US shares, and just £3 on UK shares, with a foreign exchange fee of just 0.5%. IG also offers some trading features that others don't, such as out-of-hours trading in US shares while the market is closed.


There are a few limitations you should consider as well, though. IG's customer support is relatively slow when compared to a lot of the other stockbrokers, such as Interactive Investor. The product portfolio is also fairly limited, and the stock CFD and forex fees are quite high when compared to other brokers offering similar products.


You can also get a demo account with IG, so you can try everything out before you sign up for an account on here.


BullsEye's verdict:

⭐⭐⭐⭐


😍 Easy to use trading platforms (mobile apps and online portal)

😍 Strong product offering for experienced and/or high-risk traders (CFD and spreadbetting accounts)

😍 IG offers a number of interesting features that you won't find elsewhere

😍 You can try before you buy with IG's demo account

🙁 Product and trading fees are relatively high

 

AJ Bell

If you are yet to find the perfect platform for you, another option that you may want to think about is AJ Bell. This stockbroker is known as one of the biggest discount brokers in the country, having been founded back in 1995.


It is quick and easy to open an account on AJ Bell, and it should not take you much more than 10 minutes. Their platform is easy to use, yet it is not overly sophisticated, which is why a lot of beginners are attracted to AJ Bell. There are a number of different account types on offer - Stocks and Shares ISA, Pensions (SIPPs), trading accounts and a number of accounts for children. Although outside of the standard product offering, the more complex products and services are fairly limited, with CFDs, futures, options, and forex lacking at the moment. Moreover, the technical research tools are rather basic, especially the charts, and so this platform is not advisable if you want to do advanced research.


AJ Bell's product fees are reasonable, although, for example, they do charge a percentage custody fee for their ISA accounts of 0.25% for shares and 0.25% for funds. So as with all brokers that charge fees based on the value of your assets, you'll need to spend some time doing calculations to understand whether it offers good value for money. Trading fees are also relatively high, with AJ Bell charging £9.95 per share trade, although they do offer an exceptionally low trading fee for funds (£1.50 per trade). It is definitely worth doing your research into the relevant fees and charges with AJ Bell before jumping in.


We have also found the customer support team to be incredibly helpful at AJ Bell, and they tend to respond quickly too, which is always a big bonus.


BullsEye's verdict:

⭐⭐⭐⭐


😍 Easy to use trading platforms (mobile apps and online portal)

😍 Strong customer service and support

😍 Strong core product offering - ISAs, SIPPs, trading accounts

🙁 Research tools not well suited for advanced research and charting

🙁 Fees are above average, but research is required as custody fees are charged as a percentage

 

DeGiro

There is no denying it, DeGiro is probably not one of the first names you would conjure up when thinking about the leading stockbrokers for UK investors. Being based in the EU, DeGiro is not a household name in the UK, but it is definitely worth your consideration.


DeGiro might seem like a bit of a wild card to the average UK investor, but do take the time to research, especially if you are looking for a straight-forward trading account, with great, easy to use platforms, low fees and strong coverage across different asset classes (offering shares, ETFs, bonds, investments and much more) and international stock markets (from the US, to London, to Hong Kong).


Only last year, DeGiro underwent a merger which resulted in the biggest online execution-only broker being created in Europe, with its own banking license.


There is a lot to love about DeGiro. It is regulated by a number of top-tier regulators, and is a stockbroker to offer one of the lowest, flat trading fee structures, across asset classes. For example, trading US stocks and ETFs starts at no cost. Trades for UK stocks starts at £1.75 per trade. You certainly won't get those trading fees with the larger UK-based stockbrokers! DeGiro also doesn't charge any custody fees. Degiro's mobile app and web trading platforms are also easy to use and incredibly well-designed.


There are a few drawbacks to keep in mind however. One of the main ones being that you cannot make a credit card or debit card deposit. On top of that FX trading is not available and the research tools are fairly limited as well.


BullsEye's verdict:

⭐⭐⭐


😍 Great trading platforms (mobile app and online portal)

😍 Very competitive trading (flat) fee structures

😍 Strong coverage across asset classes and international financial markets

🙁 Only really offers an execution-only trading account

🙁 Limited account capabilities, such as limited methods for funding your account

 

Trading 212

Last but not least, we have Trading 212, which is a relatively new entrant to the market and offers a low-cost trading-only solution, without a lot of the bells and whistles. Trading 212 is regulated by the FCA in the UK.


Their educational offerings, research, and online tools are basic, and there is a limited scope of investments across international markets. However, being a fintech stockbroker, Trading 212 does offer 24/7 support with very good response times.


However, there are plenty of different benefits that are associated with going with Trading 212. This includes the fact that they do not charge commission on any trade - it is completely free. However, do be aware for currency conversions there is a charge of 0.15% and there are deposit fees of 0.70% charged above EUR 2,000.


Aside from the commission-free trading, which is obviously the main pull factor for regular traders looking to avoid trading fees, Trading 212 also offer fractional shares for trading and investing, and their platform and mobile trading app are simple and user-friendly.


Trading 212 also offer long and short trading with leverage through their CFD offering.


A lot of people have told us of how Trading 212 is simple and a joy to use - and this is certainly one of the major benefits of Trading 212. You could definitely do worse!


BullsEye's verdict:

⭐⭐⭐


😍 Great trading platforms (mobile app and online portal)

😍 Commission-free execution-only trading accounts and does offer CFD trading

😍 Good customer support and response times

🙁 Not suitable if you are looking for UK tax-wrapper products, such as ISAs or SIPPs

 

Final words on choosing a UK stockbroker


As you can see, there are plenty of different stockbrokers for you to choose from today in the UK.


Keep in mind that your choice of stockbroker must be arrived at with consideration for your specific circumstances.

  • What type of product or account are you looking for?

  • Which markets and asset classes are you looking to trade or invest in?

  • How frequently do you anticipate trading, and therefore how much will you be charged in product fees and trading commissions?

  • How do you want to access your account - online, telephone, mobile app?

  • What level of customer support will you need?

We hope that this has helped you to narrow down your search and find the best solution for you. Remember, there is no right or wrong answer, it is all about thinking about what you really want from a stockbroking platform and finding a solution that fits.


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