UK Stockbrokers and Brokerage Firms

There are a large number of stockbrokers and brokerage firms providing service to investors in the United Kingdom. Choosing which one to trust with your hard earned cash can be a daunting task indeed. All stockbrokers in the UK are required to become licensed and are regulated by the Financial Services Authority (FSA). However, that does not mean that all brokers are the same. Serious consideration should be given before handing over your financial future to a stockbroker. So how do you choose from all of the UK stockbrokers and brokerage firms? Asking friends and co-workers is one way to get some references. However, it is best to also do some research on your own. We will help break down the process to ensure that you are making an educated decision.

One of the first decisions you should make are whether or not you would like to research your own investments and make your own trades or if you would like help from a stockbroker. If you are interested in making your own trades (the trades are actually executed by a licensed broker, you simply place orders on your own), then an online broker is probably the best bet. An online stockbroker will usually be much less expensive than a live broker that you will meet with face to face. If an online share dealing account sounds like something you are interested in, you are invited to read our chapter on How to Buy Shares Online, along with this article.

Large Brokerage Firms

Many large brokerage firms in the UK have a presence both online and in locations around the country. One of the largest firms is Barclays Stockbrokers, a part of the Barclays Financial Group. They offer a number of different accounts including ISAs and other investment accounts. These may be managed online or through one of the many local Barclays Banks offering brokerage services. Barclays is not the least expensive of the online brokers, but it is nice that if needed, you could visit a local branch and speak to someone about your account. Online trading is offered at ₤12.95 per trade, a fair price for the service they provide. They also offer fully managed accounts and other stockbroker accounts that allow for more personal interaction with a broker, of course at an additional fee.

TD Waterhouse

Online share dealing is also available through TD Waterhouse. They too are not the least expensive stockbroker at about ₤12.50 per trade, even though they mostly deal online. TD Waterhouse is a large company, however, and puts the weight of their name and reputation behind their site. They offer a great deal of information and they do have an office in downtown London, called the London Investor Centre, which anyone with an account is invited to visit. There they offer live seminars, additional research resources and you can even book an appointment with a representative to speak one on one.

Charles Schwab

A large US based company making a presence in London is Charles Schwab. They are a very popular choice in the States and also have an office, the Schwab’s London Investor Centre, in downtown London. Charles Schwab is a great choice for investors looking to trade in US securities as they have resources, accounts, and other services designed just for that venture.

Loyds TSB

Lloyds TSB is another large banking group in the UK that also offers share dealing accounts. With offices throughout the UK, Lloyds TSB offers hands-on help with creating and managing a portfolio. If you prefer, though, you may deal shares online without the help of a broker. Their regular rate for online trading is ₤15 per trade.

Halifax

Those trading shares online without the help of a stockbroker will appreciate the wealth of information available to their clients from Halifax. An online share dealing account through Halifax offers trades from ₤11.95. They offer mobile trading, an online research centre, several choices of accounts and are also available either by phone or in person at one of their branches. Like many of the larger brokerages, they also offer face-to-face meetings with financial advisers by appointment. These advisers can help walk you through the investing process and even set up accounts and make investment recommendations.

Redmayne-Bentley

Investors seeking personalised advice and who do not mind paying a bit more for top-shelf service should visit their nearest Redmayne-Bentley Stockbroker. They have offices throughout the UK, at which you may sit down, one on one, with a stockbroker. He or she can help you create a financial plan for the future while pointing out and executing immediate financial opportunities.

Execution Only Share Dealing

There are a number of execution only online share dealing services available to UK residents. Execution only brokers offer no personalised advice; they simply fulfil the orders as placed by their clients. The lack of personal attention equates to a lower fee in most cases. Just because these brokers do not offer advice does not mean that they do not offer very valuable resources however. In fact, some of them offer invaluable amounts of data including independent research, news, articles, charts and quotes and even practice accounts.

Motley Fool

The Motley Fool share dealing service is one such online provider that has an immense amount of information available at your fingertips. Their website, at fool.co.uk, has up to date news and articles written by professionals in the financial world. They offer free investing guides, research and general advice for new and experienced investors alike. Their share dealing service is available for only ₤10 per trade and offers all of this advice along with additional investor tools available for free, 24-7. They also allow international trading for a small premium.

Interactive Investor

Another such service is Interactive Investor, which also allows clients to deal shares for ₤10 per trade. They feature a portfolio builder service, which adds shares to your portfolio on a regular basis, for just ₤1.50 per trade. This is a great way to start investing and for those who do not have a large amount of money to invest at one time but understand the importance of saving and investing.

Selftrade

Likewise, Selftrade also offers regular investing for ₤1.50 per trade. Their regular share dealing account charges ₤12.50 per trade, but offers discount to only ₤6 per trade for frequent traders. They define frequent trading as more than 100 transactions in a calendar quarter, which is quite a lot for the average investor.

Opening the Correct Type of Account

Stockbrokers and trading sites, whether based on the web, through office locations around the country, or a combination of both, offer a number of different account options. It is just as important (perhaps more so) to open the right type of account as it is to choose the right stockbroker or even the right shares to purchase. If you are unsure, take advantage of the customer service available through each company, but also research for yourself. We have an article entitle Types of Trading Accounts, which examines each of the accounts and explains their benefits as well as their restrictions. You may then compare each UK stockbroker against each other and decide what is best for your personal situation.