Investing in US stocks from the UK

Buying US stocks is easy - see how to find the right investment broker to trade US stocks.

US stocks have historically seen higher returns than those in the UK – not to say that this is an indication of the future results but it’s drawn investors towards it like a moth to a flame. For those of us that are in the UK, this means you need an international stock broker that lets you trade US shares. Luckily, there are plenty available to choose from. Find out how to invest in US stocks, more on why you might choose to and some things to keep in mind.

Can I trade US stocks in the UK?

Yep! You just need a broker that lets you invest in US stocks, we’ve listed some of these below – check out our reviews on them to find one that suits you. There are some things you need to take into consideration when investing in US stocks, including the fees involved and whether you need to fill out a W-8BEN form.

Some UK platforms which let you buy US stocks

How to invest in US stocks

  1. Choose a share-dealing platform. If you’re a beginner, our table below can help you choose.
  2. Open your account. You’ll need your ID, bank details and national insurance number.
  3. Confirm your payment details. You’ll need to fund your account with a bank transfer, debit card or credit card.
  4. Find the US stocks you want to buy. Search using the stock code or company name.
  5. Buy US stocks. Simply click “Buy” to finish your order.

You can invest in US stocks using a number of trading apps, brokerages, online share-trading platforms or by buying exchange-traded funds. Each will give you different levels of access to the US stock market, as well as trading options and features.

UK brokers for US stocks

Table: sorted by promoted deals first
Name Product Ratings Finder rating Customer rating Min. initial deposit Price per trade Frequent trader rate Platform fee Offer Link
FREE TRADES
eToro Free Stocks
Finder score
★★★★★
User survey
★★★★★
★★★★★
Expert analysis
★★★★★
User survey
$200
£0
N/A
£0

Capital at risk

Platform details
Finder Award
OFFER
Freetrade
Finder score
★★★★★
User survey
★★★★★
★★★★★
Expert analysis
★★★★★
User survey
£0
£0
N/A
£0
Claim your free share worth between £3 and £200. Capital at risk.

Capital at risk

Platform details
interactive investor Trading Account
Finder score
★★★★★
User survey
★★★★★
★★★★★
Expert analysis
★★★★★
User survey
£0
£7.99 (with one free trade per month)
N/A
£9.99 per month

Capital at risk

Platform details
Degiro Share Dealing
Finder score
★★★★★
★★★★★
Expert analysis
Not yet rated
£0.01
UK: £1.75 + 0.014% (max £5)
US: €0.50 + $0.004 per share
N/A
£0

Capital at risk

Platform details
Hargreaves Lansdown Fund and Share Account
Finder score
★★★★★
User survey
★★★★★
★★★★★
Expert analysis
★★★★★
User survey
£1
£11.95
£5.95
£0

Capital at risk

Platform details
NAGA
Not yet rated
Not yet rated
Not yet rated
£250
Variable
N/A
£0

Capital at risk

Platform details
loading

Compare up to 4 providers

All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.

Why invest in US stocks?

Over the last decade, the leading US stock indices have given investors much higher returns compared to those in the UK. By limiting your investments to only UK or European stocks, you may be missing out on the potential bigger gains offered by trading US shares.

The US stock market is home to many of the largest companies on the planet, such as Apple, Amazon, Microsoft and Facebook. Along with access to the world’s leading companies, the US stock market also includes the New York Stock Exchange and NASDAQ, which are two of the world’s largest stock exchanges, and offer deep liquidity and extensive trading opportunities.

“It’s just a really dynamic, exciting market with the broadest range of products,” Stake co-founder and CEO Matt Leibowitz told Finder. “It lets people diversify the way they invest.”

A couple of decades ago, it was difficult and costly to invest in foreign stocks. These days, many trading platforms and brokers offer low-cost access to many international markets, including the US stock market.

What to keep in mind when trading US stocks

  • How much is brokerage? Compare the fee each company charges every time you place a trade on US stocks. Be aware that this will be different to broker fees for UK stocks.
  • What’s the exchange rate? Exchange rates vary from platform to platform and this will partly be used to offset low broker fees. Check what these are first.
  • Will you need to pay a monthly fee? Some platforms require you to pay a monthly fee in order to keep your account running or to access certain features.
  • How is market data displayed? Check how up-to-date the market data offered by each platform is – being able to make trades based on current information is critical.
  • How many international markets can you access? Some platforms offer access to a few key international markets while others let you buy and sell shares on a much larger number of exchanges.
  • How easy is the platform to use? Is it fast, simple and convenient to execute a trade and monitor market performance?
  • What trading options are available? Is the platform just online or can you also place trades over the phone? Are flexible options like limit orders available to let you take advantage of market fluctuations?
  • Are education and research resources available? Trading shares is complex, so does the platform offer the necessary tools to increase your investment knowledge?
  • Is customer support available if you need it? How can it be accessed and when?
  • Can I fill out a W-8BEN form electronically? You need to fill out a W-8BEN formwhen trading US stocks to determine your tax status. Some brokers let you do this electronically while others ask you to return one by mail.

Pros and cons of investing in US shares

Pros

  • Access different investment opportunities. Trading via US stock exchanges allows you the freedom to take advantage of investment opportunities that are not available in the UK.
  • Increasingly more affordable. As a growing number of online share trading platforms compete for market share, brokerage fees are becoming more affordable.
  • Diversify your portfolio. If all your investments depend on the performance of one national economy – e.g. the UK’s – is your portfolio really as diverse as you think? Buying international shares protects you against having all your eggs in one basket.

Cons

  • Brokerage fees. You’ll need to contend with potentially higher brokerage fees whenever you place a trade on an international share market.
  • Exchange rates. The USD-GBP rate fluctuates frequently which might negatively impact your investment.
  • Additional fees. International trading accounts are sometimes subject to fees that UK-only platforms are not, such as inactivity fees and exchange fees.

Bottom line

Choosing to invest in US stocks can be a great way to get access to some rising tech stocks and diversify your portfolio. It’s a popular market for investors, but you need to make sure you know about additional fees, such as for currency exchange, that you’ll have to pay as well as commission. Work out how much you’ll spend before buying the stocks. You need to make sure you choose a broker that lets you trade US stocks.

All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.

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2 Responses

    Default Gravatar
    MannieMarch 20, 2020

    Why is it so difficult to find a US broker where I can buy shares. I don’t want EFT’s or CFD’s I want to buy a specific share and hold the share certificate.

    Help!!!

      Avatarfinder Customer Care
      TomMarch 20, 2020Staff

      Hi Mannie,

      Thanks for your question. These days, there are a number of online trading apps and brokers that let you buy US shares directly. If you’re looking for a low-cost way to invest in the US stock market, you may want to consider apps like Robinhood, Freetrade or Stake, all which offer the ability to buy US stocks directly.

      I hope this helps, but please let me know if you have any other questions.

      Regards,

      Tom

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