Have you ever wondered how to buy and sell stocks from the UK and the best platform to do so? Well, this work has answered just that question for you and further provided a list of the best platforms to buy and sell stocks in the UK today.
The high cost of establishing a company in the UK has prevented many desiring citizens and residents from owning a company in the UK today. Well, stock trading seems to have compensated a little for this lack as it provides investors the opportunity to participate in driving the affairs of a company; influencing its price, when they become shareholders in the company. This has become one of the driving forces why a lot of people are attracted to stock trading today. A second category of people known as investors seem attracted to stock trading in the UK just to make profits alongside its proprietors. Nevertheless, irrespective of the reason why you may have been attracted to stock trading for the first time, this work is here to help you push this desire to the next level. Hence, we have exposed in this work, useful guides on how to buy and sell stocks in the UK. You will also find in this work the list of our recommended brokers for stock trading in the UK. This will make it easy for you to make your choice and begin trading. This work has therefore provided an answer to many of the frequently asked questions in the UK regarding stock trading.
What is stock trading in the UK?
Stock trading is an investment package for making profits through buying promising company’s shares in the UK at lower prices and selling them at higher prices. Stock trading enables individuals to participate in the ownership of a company by investing in its shares. Often, stock trading enables companies to seek public funds for running the company by listing their shares through an initial offering for the public to invest in. Here, investors hope to receive dividends from buying a company’s stock while others hope to sell them off to new buyers when the price rises in the future.
Meaning of Stock Brokers
Stock Brokers are intermediary financial service providers; linking the individual to the stock exchange market. Often stock brokers list various approved stocks on their platforms, making it possible for traders to come together to buy and sell their preferred stocks. Without stock brokers coming to bridge the gap between the individual and the stock market, it would have been very difficult for the individual to trade stocks from the comfort of their homes today.
Role of stock brokers in the UK
Stock Brokers in the UK play an indispensable role for citizens and other residents in the UK. Thus, they link the traders through their platform to the London Stock Exchange (LSE), where they can buy and sell their preferred stocks. They also facilitate over-the-counter (OTC) transactions for private stocks. Added to this, stock brokers in the UK provide market information regarding various stocks listed on their platforms which assists investors in making decisions on which stock to either buy or sell.
Types of stock brokers in the UK today
There are three main types of stock brokers in the UK today. We have discussed them below:
List of best ten stock brokers in the UK
To make stock trading easy for beginners residing in the UK, we have provided the list of the ten best stock brokers in the UK today. They include:
Step-by-step guide on how to buy stocks from UK stock brokers
There are five major steps for buying and selling stocks in the UK today. They are discussed below:
The trader is therefore expected to choose one out of the three types of accounts listed above.
Ways of Buying and selling stocks in the UK
There are three major ways of buying and selling stocks in the UK today. We have discussed them below:
What stocks are offered by UK stock brokers today?
Below is the list of the best twenty stocks offered by the UK brokers today:
Do stock traders in the UK pay tax?
It is an existing law in the UK for all stock traders to pay tax for all investments made in buying stocks, especially when they are not made from the personal saving accounts or pension accounts of the investor. For each share purchased from a broker, the trader is charged a tax of 0.5% on the total transaction carried out. These charges applied for trading stocks electronically in the UK are called Stamp Duty Reserve Tax (SDRT). However, this stamp duty does not apply when one purchases smaller AIM-listed UK shares from an exchange.
Is stock trading a lucrative business in the UK?
Stock trading no doubt is a very lucrative business in the UK today; which offers investors an opportunity to make profits from their investments, especially when they buy promising company’s shares, at lower offering prices in the exchange market, and wait to sell them at higher prices. Averagely, stock traders in the UK made 10-15% profits annually from their stocks investments. Others could make lower or higher depending on the success rate of the stocks they have purchased. It is therefore very necessary for UK stock traders in the UK to make proper research and investigations about a particular stock, before proceeding to buy or sell them through a broker.
Factors to consider while choosing a stockbroker in the UK today
There are some important factors to consider while choosing a stock broker for trading in the UK today. We have discussed them below:
Guide on how to legally trade stocks in the UK without taxation
The only legal way to avoid taxation while trading stocks in the UK, is to invest in the UK stock market using a ‘tax wrapper’. A tax wrapper is a government exemption from paying tax when the individual wraps his money around his saving and investment accounts. Thus, tax exemptions are given to investments into stocks shielded under tax wrappers.
Generally, there are two main tax wrapper accounts that could be used for tax-free stock trading in the UK today. We have discussed them below:
Above all, apart from using the tax wrappers to reduce tax payments, one can also use a general investment account to trade stocks. A general investment account permits you to invest up to £12,300 without having to pay taxes on your returns.
Advantages of stock trading in the UK
Disadvantages of Stock trading in the UK