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Trading fees statistics
How do trading fees differ for investing platforms?
Trading platforms have made investing for the average person extremely easy through the use of apps. However, this does come with a cost. All trading platforms have fees – either flat or foreign exchange rates that vary considerably depending on which platform you choose to trade on. We conducted a survey on how much the average trader invests and looked into 13 trading platforms to compare their trading fees to see how much they vary for different types of investors.
- Over a decade, the average UK investor could lose £12,400 on broker fees.
- The average UK trader buys or sells £1,762 on each trade.
- The average UK trader makes 38 trades a year.
- Interactive Investor has the highest foreign exchange fee at 1.50%.
- Hargreaves Lansdown (£11.95) charges the highest flat fee.
- Degiro has the lowest trading fees of all platforms – with no flat fee and 0.10% foreign exchange fee.
How much does the average UK trader invest in a year?
Our survey found that the average UK trader makes 38 trades a year, buying or selling an average of £1,762 worth of stock on each trade. This gives an annual trading amount of £67,688.45 for the average trader. *Note that this money is likely to be recycled.*
What is the most expensive trading app for US stocks?
With a flat fee of £7.99 plus a foreign exchange rate fee of 1.5%, Interactive Investor is the most expensive trading platform to use. With £1,762 being the average amount per trade, Interactive Investor will take £34.43 for each trade, equalling £1,308 for a full year of trading.
The cheapest trading platform is Degiro, with no flat fee and a foreign exchange rate fee of 0.10%, each trade of £1,762 will cost £1.76 in trading fees. This makes Interactive Investor almost 20 times more expensive than Degiro in trading fees for US-based stocks.
|Trading platform||Total trading fee for a one off trade of £1,762.72|
Flat fees vs forex fees
Some more established trading platforms charge a flat fee for each trade. Hargreaves Lansdown has the highest flat fee of all platforms, charging £11.95 per trade. The other platforms that charge a flat rate are IG (£10), AJ Bell (£9.95), Interactive Investor (£7.99) and Fineco (£3.95). There are 7 platforms (eToro, Freetrade, Degiro, Stake, Trading 212, Lloyds and Halifax) that do not charge a flat fee.
|Trading platform||flat fee||forex fee total||total|
As shown in the graph above, there are some platforms where the flat fee is higher than the foreign exchange rate fee. The flat fee for Hargreaves Lansdown makes up 57% of the total trading fees for a £1,000 trade. AJ Bell’s flat fee makes up 54% of the total trading fee.
Beginner investors who may be more concerned with the risks of trading should consider the amount that is charged in flat and forex fees. For example, a £50 trade could end up paying £12.45 (25%) in trading fees if using Hargreaves Lansdown instead of Degiro, where the trading fee will be £0.05p (0.10%). This means £49.95 of the initial £50 will be invested into the chosen stock if you use Degiro.
Out of the 13 trading platforms analysed, 5 platforms will charge over £1 in trading fees for a £50 trade: Hargreaves Lansdown (£12.45), AJ Bell (£10.33), IG (£10.25), Interactive Investor (£8.74) and Fineco (£4.45).
There are 8 platforms where trading fees will be less than £1 for the £50 trade: Degiro (£0.05), Trading 212 (£0.08), Freetrade (£0.23), eToro (£0.25), Stake (£0.25), Revolut (£0.50), Lloyds (£0.50) and Halifax (£0.63).
|Trading platform||Total trading fee off a £50 trade||How much of your £50 trade will actuallly be invested|
Many experienced traders are attracted to the security and trust that leading investing brands such as Hargreaves Lansdown, AJ Bell and Interactive Investor provide.
Our graph shows that when the trading value increases, the difference between older and newer trading platforms also changes. For a single £10,000 trade, Interactive Investors has the highest trading fee, at £157.99, followed by Halifax (£125) and Hargreaves Lansdown (£111.95). The least expensive platform for trading fees would be Degiro at £10, followed by Trading 212 (£15) and Freetrade (£45). Interactive Investors trading fees are 15 times more expensive than Degiro when trading higher sums. When making a single trade for the average trade amount of £1,762, the fees are 20 times higher between the 2 companies.
|Trading platform||Total trading fee|
How much could be lost on trading fees over time?
If the average trader were to buy and sell US stocks at the average rate for a decade, they would pay an average of £6,415 in fees. However, the difference between the most expensive and cheapest would be £12,414. Three platforms would have fees above £10,000, with 1 above £13,000, while 3 platforms, eToro, Freetrade and Stake, would have fees of under £3,500, with Degiro below £700.
If younger investors were to continue trading for the next 40 years at this rate, they would pay an average of £26,233 in fees. The difference between the most expensive and cheapest platform would be £49,655. Three platforms would have fees over £40,000, including 1 over £52,000, versus less than £2,700 with Degiro and around £4,000 with Trading 212.
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