Best Online Exchanges for Buying Stocks in 2023
Bogdan LashchenkoIntroduction
The world switched online long time ago and it entailed some things that used to be available offline but now could be done in the internet world. Purchasing different items, booking services, miscellaneous stuff, and even purchasing securities. We will talk about purchase of securities in the article today.
As this essential part of investor’s life is regulated, their online purchases have their own specifics, but generally purchase of securities online is not very different from how it works offline. Investors still have to pay tax from their income.
Also we should state that there are numerous online platforms that offer shares of various companies and they are different from each other by terms of providing services and tools that could be used by investors. We will look into several platforms of this kind and give you some information that will be sufficient to start investing in securities online. Let’s point out that commissions are either absent or extremely low on the majority of the platforms, so the process of investing must be very comfortable for users.
Best platforms for purchasing and selling stocks online
Interactive Brokers
Interactive Brokers must be one of the most famous resources of this kind. The American weekly magazine Barron’s, which is published by News Corp a branch of Dow Jones & Company, called this platform the best for online investment.
There are several reasons for this. Interactive Brokers attract their clients with low prices for a share, advanced trading on the platform, and also a wide selection of securities and very low margins. Their new product IBKR Lite can offer its customers purchasing of securities without any interest.
Some advantages of Interactive Brokers include a wide range, consisting of over 18,000 shares available for purchasing without commission, huge selection of other investments, and great tools that will enable you to do your own research.
The main disadvantage of the platform is difficult navigation on the website of Interactive Brokers, however, this downside could be considered subjective. If users understand how to invest on Interactive Brokers, they will simply have no reason to disregard this online exchange.
If Interactive Brokers used to be focused on more professional investors and traders, after the launch of IBKR Lite regular users got an opportunity to invest their money into shares. All kinds of deals are available for users, including both normal spot trades, and options, futures, mutual funds and even tools with fixed profits. It can be realized on 135 exchanges and in 33 countries.
Interactive Brokers also expanded the array for professional traders and gave them a chance to try out IBKR Pro that is different from IBKR Lite by a wider selection of securities, however, the interest is $0,005 per a share there. It is noteworthy that in case with IBKR Lite and IBKR Pro the minimum deposit of investors is $0 which means that anyone has a chance to start their investing journey. Another pleasant bonus is that if users are inactive, a service fee will not be charged from their accounts.
Another interesting feature of Interactive Brokers is the function of fractional purchase of shares which is a great move for beginning investors. In 2021, when the cryptocurrency market had the best figures, IB decided not to stay away and also started to flow into the deal. Now you can trade digital assets on IB as well. These include Bitcoin, Ethereum and Litecoin. The list may expand, however, it works rather as an additional function as trading digital assets should be done on specialized exchanges.
Interactive Brokers provide powerful tools for monitoring both assets that are already in investors’ portfolios and those that they want to pay their attention to. IB gives a chance to track assets with the help of different news that can affect the rate. Besides, users can set notifications to always be aware of what is happening.
Fans of margin trading will also like Interactive Brokers as deals are very low there. More professional investors use tools of IBKR Pro, and in this case the maximum margin will be 3,83%. Investors of a lower level, using IBKR Lite will get 4,83%. These rules work in case if operations do not exceed $100,000. Otherwise, the margin will be much smaller.
IB also has a mobile version of its platform which can give its customers an opportunity to track their portfolio on a smartphone. As well as in the case with a website, you can set notifications that will notify investors about interesting news that will concern assets and other moments affecting the value of securities.
As we have already mentioned that the main disadvantage of Interactive Brokers is confusing interface on the site. It is explained by a very big amount of information provided by IB. Inexperienced investors can easily get lost in all these figures and experience inconveniences in using the website. Other minuses include the fact that customers’ support on Interactive Brokers is not the best an is only done in emails and calls. It can complicate the process of introduction of beginning investors with the process of plunging into the world of money investment.
As for the rest, IB has plenty of advantages that can attract both professional investors and newbies that are only setting off in the sphere. Interactive Brokers will suit regular and advanced traders. Beginners should also try themselves out, but you should be morally prepared for the fact that the learning process can be a bit more challenging than it seemed at first. IB will be great for day-traders who spend every day making deals and speculating. Interactive Brokers will be perfect for those who are keen on margin trading, options and fans of thorough examination and international investors.
Fidelity
Fidelity is a broker company that deserves to be called one of the most comprehensively developed in the world. As well as in the case with many other brokers, it does not have commissions in security deals or funds that are traded on the market. Fidelity will work not only for beginning investors and those who have been doing it for a while, but also for professional investors of their money into securities.
Another advantage of Fidelity is a great selection of securities available for purchase. Investors and traders will be offered over 3,300 mutual funds without commission for transactions and also tools that will help users to do their own research of stocks.
Another plus of the platform is the mobile version that will provide new opportunities for investors and make tracking securities even more functional. You should also know that the mobile app is very popular. In Google Play it has over 5,000,000 downloads and rated 4,2 out of 5 based on 118,000+ reviews.
Fidelity Investments express their interest in education of its clients. This is why the company made an educational course that will help beginning investors to continue their way to the world of big investments and also strengthen the knowledge and investors and traders already have as they already have some experience even though they want to improve their qualification. By the way, this course will be great for different kinds of clients starting from day-traders that make speculative deals every day and finishing with investors who invest their money in the long term.
Some disadvantages include limited broker services. Fidelity give their clients a chance to sell not only on spot but also in options and also provide a chance for fractional purchase of assets. Nevertheless, the platform will not enable making deals with derivatives. Therefore, traders and investors will not be able to open future deals which will push some users away as they prefer this kind of trading. Trading commission with the help of a broker is too high in some cases and reaches $32,95.
This year Fidelity got a chance to trade not only securities but digital assets as well. Now investors and traders can make deals with Bitcoin and Ethereum. As in the case with Interactive Brokers, this action is suspicious as such things should be done on specialized cryptocurrency exchanges. Nevertheless, Fidelity expanded their tool set and investors can use the opportunity to try themselves in one of the two digital assets if they like trading securities.
We should understand that we cannot say about a complete absence of any interest on Fidelity. The company has already canceled lots of charges but it still has transfer commission and a fee for closing the account, however, it happens with different brokers which is not surprising at all.
Fidelity Investments can be praised for some innovative ideas. While chasing the title of one of the most remarkable and high-quality brokers, the company was the first to introduce the idea of index funds without expenses on the market. Thus, clients can create not only a well-balanced portfolio but also an almost free one where you will not have to have money for its service. As we have already said, over 3,300 mutual funds do not have any interest. Over 950 of such funds trade with commission of 0,5% or less. If clients want to buy funds that are not listed among the mentioned privileged stocks, in this case a purchase will cost $49,95, while selling the assets will not charge you anything.
Monitoring on Fidelity is also on a very good level. Research and testing tools are available for clients on the advanced trading platform for professionals and on the normal one for more casual investors. These tools provide historical data for ten years that helps people to make a decision.
Fidelity is different from many similar platforms with its downloadable software Active Trader Pro, which gives a chance to adjust the interface and necessary financial tools for yourself. Clients can use the necessary market and technical filters with advanced tools for options and tickets for several deals where you can keep delayed orders. Active Trader Pro can process up to 50 delayed orders.
We should also speak about the mobile application that will give users all the necessary opportunities to trade and invest without an access to personal computers. The iOS and Android app was rated by users well thanks to the fact that in mobile Fidelity there is a chance to track quotes in real life. Besides, users can not only invest or trade, but track assets that interest them and make subscriptions to the ones that will notify users about all interesting events related to any security or crypto asset. Additionally, Fidelity always improve their mobile app to improve optimization for various mobile devices and simplify user’s experience. It will give them a chance to be compatible in comparison with Interactive Brokers who are known for the complexity of their tools and interface for regular users.
Fidelity made an interesting test for investors that will filter all the unnecessary tools and keep the most necessary ones for the style of trading and investment that they prefer. The research tools are good enough to use and sort.
Fidelity’s unique feature is a chance to set up an youth account. This term means making an investment portfolio for people aged 13-17. Teenagers can run their independent operations being watched by their guardian. People with youth accounts can get access to all assets, funds and fractional shares.
Owners of youth accounts can invest in some mutual funds on Fidelity. The main distinction of such accounts is not only the fact that they belong to people who have not come of age but also with an absence of the chance to do very risky operations. These include deals with options and margin trading.
Development of the new generations of investors will be facilitated by this type of an account but also a mobile app with educational materials that will help them to get used to the world of investments. When turning 18, the owners of teenager accounts will get a new status and all high-risk deals will be available for young investors.
Fidelity will work for all investors and almost all traders. It concerns not only their style but age. Only a few brokers can provide a chance to create accounts for teenagers and give them educational courses that will teach them how to manage money. The only audience that can be put off by Fidelity is traders that like high-risk deals as the broker doesn’t enable future trading. In all other cases Fidelity can satisfy almost all requests.
J.P. Morgan Self-Directed Investing
J.P. Morgan offers services not only of an investment fund where the stuff will accept financial savings and manage them on their own, investing into those shares that it thinks are necessary. This company has a different department that is related to investments and assets but it gives a chance to its clients to make the deals independently.
The company is especially interesting as the investment fund has been functioning successfully since 1789. The capital of J.P. Morgan surpasses $294,000,000,000. That is why the management of the organization decided to set up a project called Self-Directed Investing.
This platform for investments has its own advantages and some disadvantages that other services don’t have. One obvious advantage lies in a simple and intuitive interface where even those investors who have never made a single deal with securities in their life will be able to achieve new results. It is fundamentally different from what we could see in case with Interactive Brokers. Most commissions are $0. If investors have accounts on Chase where they can give their money at the disposal of the investment fund J.P. Morgan, it can be linked to Self-Directed Investing. Some disadvantages include limited tools for research and also a deposit of $2,500 if clients want to work with Portfolio Builder.
J.P. Morgan Self-Directed Investing positions itself as a simple platform and web-trading is the main advantage of the platform. Despite the fact that we have already mentioned the sum of $2,500 that you have to deposit to be able to use the tool Portfolio Builder, it does not have a minimum deposit. All investors, professional ones or beginners, can start their investment path with any amount. However, despite the statement, the platform does not have fractional investments in shares. But users can invest at least $1 in mutual investment funds if they want.
However, the low entry threshold in the industry through J.P. Morgan Self-Directed Investing, traders and investors can come across difficulties in terms of insufficient number of necessary research tools. It can be a kind of advantage for beginning investors but it will become a serious disadvantage for advanced investors. J.P. Morgan Self-Directed Investing will be great for classical investors in securities. Fans of active and risky trading, and also digital asset enthusiasts will not be able to find what they need. The company does not provide tools that enable working with cryptocurrencies, futures, forex markets and fractional shares. Only assets, bonds, funds and options are available tools on the platform.
We should go into details about the mentioned Portfolio Builder that requires a deposit of $2,500. Why is it good and why should we choose it? Because the process of investing money can be too confusing for the users that have never done anything like this before. The developers of Portfolio Builder created a special test that you will have to take. Based in the test, the algorithm will define if investors are ready to risk and the principle of diversification of their assets. After that Portfolio Builder will offer assets that the users will be eager to add to their portfolio.
Overall, if we speak about the audience of J.P Morgan Self-Directed Investing, in this case we would call beginning investors. J.P. Morgan Self-Directed’s tools are too simple and will not work for professionals that are used to working with a big number of variables. This platform can become the next step in the exploration of the world of investments for the clients who used to invest their money in investment funds but now want to learn to diversify their money on their own.
How to choose the platform for investment?
To understand what platform you need to choose for independent investment, you need to answer a few questions. Do you want to do long research on the market and analyze securities? In this case you Interactive Brokers will become a perfect fit for you as it is filled with similar things and it will not match anyone. If you prefer a simplified interface and you do not want to spend too much time on thorough familiarization with assets, in this case you should go for J.P. Self-Directed Investing. The system Portfolio Builder has to help you to build the right portfolio and do a part of the work for you.
If you value a public opinion about the exchange where you want to work, in this case Interactive Brokers will match these requests as it has been recognized as the best platform according to various experts from the world of finances.
Meanwhile, Fidelity will become a great option for you if you want to look through your success on a mobile app. Besides, if you are a parent who wants to teach your children investment of finances and right management, in this case Fidelity also wins a point because of the system of teenager accounts.
As for the rest, if you are not worried about the mentioned questions, you can just go for any of the three exchanges and start investing in securities.
Bogdan Lashchenko – content manager at EgamersWorld.Bogdan has been working at EGamersWorld since 2023. Joining the company, he began fillin the site with information, news and events.