Share investment is an area with almost endless information available on the web. ProShare has lots of information on setting up a club. One way to build your confidence in share dealing is to join an investment club, where you can learn about the stock market and swap ideas. It is almost certainly a share scam, or a boiler room scam, where high-pressure salespeople try to convince you to buy a stock which they say is about to take off. If you are contacted out of the blue by someone inviting you to invest in shares, say no. Barclays Stockbrokers charges £12.95 per trade, but this falls to £9.95 if you trade between 15 and 24 times a month, and £6.95 for 25-plus. Many sites offer regular trading accounts for people who deal frequently, where the cost per trade can be as low as £1.50.
What's the best account for regular traders? Expect the rate to rise to 40% and the exemption limit to fall. This will probably all change in Tuesday's emergency budget, but for now you are allowed to make profits of up to £10,100 before you are charged capital gains tax at 18%. There is a 0.5% stamp duty reserve tax on all share purchases and profits from the shares are taxable, too. Obviously you can only deal with the amount of money you have deposited with the share dealer. The money is cleared from your online account. You'll get a real-time quote and have around 15 seconds to execute the deal. Then you choose the amount you want to spend, and deal. Select the stock name you want and you are given an indicative price quote, normally in pence per share. That jumps to £14.95 between £500 and £2,000, and to £29.95 for more than £20,000 (the Active Trader service charges a flat-rate £9.95). Hargreaves Lansdown's £9.95 deal on its Share Account is only on trades up to £500. Watch out for sites that charge higher fees if you trade bigger sums. But that becomes pricey once you start dealing in sums much above £1,000. It charges 1% on trades, with a minimum of £7.50 for real-time trades. If you are starting with very small sums, it's worth looking at the Share Centre.
If you prefer the comfort of a big banking name, Halifax and HSBC cost £11.95 and £12.95 a trade.
Hargreaves Lansdown has two services at £9.95 a trade, though its Active Trader service carries a £12.50 quarterly admin charge too. We found the cheapest flat-fee deals at Interactive Investor and the Motley Fool at £10 for UK trades with no other charges. There are dozens of online stockbrokers, all charging different fees. Killik & Co offers old-fashioned personal stockbroking, but with a minimum trading fee of £40.
HOW TO TRADE STOCKS BEGINNERS GUIDE FULL
There's a full list of brokers at the Association of Private Client Investment Managers and Stockbrokers (APCIMS). For example, Halifax charges £11.95 per trade online and from £15 per trade over the phone.
Most of the providers offer dealing services by phone, though these may cost a little more per deal. The dealer may also require a minimum deposit, often around £100.
HOW TO TRADE STOCKS BEGINNERS GUIDE PASSWORD
That said, if you set up an account with a company you've never had any dealings with before (eg, if you opt for Halifax share dealing but your bank account is with Lloyds), you won't be able to start dealing until you receive a password in the post. With your bank details and a debit card, you can start trading almost immediately with just a few hundred pounds. The cheapest way is to set up an online account (see table).
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