Start Investing with an Online Brokerage Account

If you’re ready to start investing, here is some basic information about finding and setting up an online brokerage account

Alanna Petroff 19 September, 2012 | 6:20PM
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If you are ready to start investing, the next decision you have to make is a logistical decision: what kind of account will you use to invest and build your portfolio?

Beginners may want to invest with the help of a financial adviser to gain more investment expertise, advice and perspective. An adviser will generally help you create a financial plan, monitor your portfolio and execute trades. But many investors who feel comfortable with their own investment knowledge and investment decisions may choose to invest on their own using an online brokerage account.

“Too many people spend their time wondering what [investments] to buy, when they should be considering how they’re going to manage [their investments],” said Mark Dampier, head of research at Hargreaves Landown, which offers online brokerages accounts. Having a suitable investment account is “by far the most important thing. If you don’t have the administration system and logistics worked out, you can’t manage your portfolio,” he said.

Online brokers have been gaining in popularity over the last decade as it’s become more common to bank, trade and invest online. It’s also considerably more convenient to see your portfolio online instead of having to look through reams of paper statements.

Online brokers allow investors to set up accounts, deposit money into their accounts and then buy and sell equities, funds and other securities within these accounts. Many different kinds of online brokerage accounts are available for individual investors in the UK. Some are geared towards beginners while others cater to advanced investors. Some brokers have very basic offerings and charge very low fees, while others have a more full-service approach, which generally results in higher fees. 

Fees and charges are a big consideration for any investor who is considering opening an online account, but other factors will also influence the ultimate decision about where to open an account. Brokerage accounts can differ in terms of order execution speeds, informational and analytical tools and the variety of tradable assets available to investors. Some systems are also sleeker and more user friendly, while others may be clunky. Customer service levels could also influence where an investors will choose to set up an account.

Below is a short list of some of the brokers offering online brokerages accounts to individual investors in the UK:

Hargreaves Lansdown

Hargreaves Lansdown is a leading online broker in the UK. It’s Vantage Account allows investors to have funds, shares, investment trusts, ISAs and self-invested personal pensions (SIPPS) in a single account.

It’s important to see all your investment together in one consolidated area and the Vantage account provides that, said Dampier.

To set up an account, simply call in, you’re screened to ensure you are not laundering money, and then you can deposit money into your brokerage account right away from your bank account. In many cases, you can start investing the same day that you open your account, said Dampier.

TD Direct Investing

TD Direct Investing offers a TD Trading Account which allows clients to manage their investments online and on the phone.

"Today's DIY investor needs easy access to the tools and products that will help them make the most of their investment portfolios,” said Stuart Welch, CEO at TD Direct Investing. “At TD investors can enjoy online access to our free research tools, invest in over 2,000 funds, access tax efficient products such as ISAs and SIPPs and trade on the go via the TD Trading App. UK investors can apply online for an account with TD and if successful, begin trading on 17 international markets all in the same day."

TD Direct Investing has roughly 200,000 clients in the UK with over £5 billion in assets under management.

Fidelity Worldwide Investment

Fidelity offers a secure online platform to invest in equities, funds, ISAs, and pensions. Investors have to sign up for each account separately (i.e. you must sign up for a funds account and also sign up for an ISA account separately) but then once the accounts are up and running, you can access them all together online.

HSBC Sharedealing

Investors  can use HSBC’s InvestDirect or InvestDirect Plus sharedealing accounts to make their investments and track their portfolios.

Halifax Share Dealing

Investors can choose from a variety of different online trading accounts, including the Halifax Share Dealing Account, which lets investors buy shares on seven of the world's largest markets. You can even open a Fantasy Trader Account to learn about investing without risking any of your own money. According to the website, the “Fantasy Trader Account gives you a virtual £10,000 to practice trading on the stock market.”

Barclays Stockbrokers

Barclays Stockbrokers offers investors a range of different kinds of online accounts, including the MarketMaster account. This account “is a flexible and convenient trading account that gives you access to a range of asset classes and markets, including shares, gilts and bonds, funds, ETFs, ETCs and covered warrants,” according to the website description.   

Interactive Brokers

Interactive Brokers provides investors with access to basic and very advanced investments. Investors can access “stocks, options, futures, forex, CFDs and bonds on over 100 market centres in 19 countries from one account,” according to the company. “Our technology stands apart from other UK online brokers in that it supports multiple asset classes, over 50 order types, real-time risk tools, execution, clearing and custody services,” states Interactive Brokers.

Saxo Capital Markets

Saxo offers three different kinds of trading accounts--Classic, Premium and Platinum--that cater to more advanced investors and traders. Clients can trade forex, CFDs, ETFs, stocks, futures, FX forwards and FX options.


The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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About Author

Alanna Petroff

Alanna Petroff  is a financial journalist with Morningstar UK.

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