Trading 212 Commission Free Trading: A Review Of My Experience
Trading 212 is a commission free London based brokerage that was founded in 2006. They offer 3 main investing services, a CFD account, an Invest account, and an ISA account. Being one of the most trusted brokerages around the globe Trading 212 is FCA regulated, and investors are protected by the FCSC up to the value of £85,000 or an equivalent currency.
Trading 212 is the number 1 trading and investing app in Europe, but it is supported around the world and is quickly becoming one of the most used investing apps with over 14,000,000 downloads since 2017. The owners of Trading 212 have not disclosed how many countries the app is available in, but based on the current speculation on forums and social media, people can sign up from all 7 continents but the only currencies you can trade with are Pounds, US Dollars, or Euros.
Trading 212 allows you to trade and invest in precious metals, commodities, currency pairs for forex trading, and over 3,000 securities from all over the world. It has the largest library of instruments at the disposal of the investor.
Pros
- You can open demo accounts to practice trading.
- They offer both an online website version and a phone application.
- Trading 212 is a commission free brokerage, meaning all of your profit goes straight into your account.
- There is no withdrawal fee when taking your profit out, also it takes less than 2 working days.
- You can choose to open either an Invest account, CFD account or ISA. But you can also have multiple.
- You can invest in fractional shares, so you can start trading from as little as £1
- There is a tight spread on the CFD account.
- You can access a full analysis report and economic calendar from within the app.
- There is no minimum account deposit or withdrawal.
Cons
- There is an inactivity fee on certain accounts, so CFD accounts have an inactivity fee after 180 days of not placing a trade. However this fee will not take you into debt.
- You cannot short sell assets on an invest account, this process is called options trading and is not available as you require leverage.
- You have to calculate your allocations manually to keep your portfolio structured. If you plan on depositing recurring amounts, you will have to manually spread your deposit across your portfolio every time.
Trading 212 Overview
This type of account is generally called a spread betting account. You do not own any assets you buy, and you do not pay tax on any earnings, however this type of trading comes with the highest risk. You need to deposit £10/$10/€10 to trade in this account.
You require leverage to trade in a CFD account of which Trading 212 will provide 1:500 for professional users, and 1:30 for retail traders. But remember, the higher the leverage, the higher the potential loss. Also if you go over your leverage allowance, you could end up being in debt to the brokerage.
This type of account is generally used for forex and commodities trading.
This account is for the long term stock investors. You can purchase fractional shares of companies you would not normally be able to afford and build your portfolio over time to grow your wealth. You can start with £1/$1/€1.
I personally have an Invest account and find it to be the best brokerage I have tried in the last 5 years. It’s easy to use and most importantly… Free!
As I mentioned you can invest in fractional shares, so you can buy as little as 0.01% of a share. So if you wanted to buy an Amazon as of the 31st March 2020 it would have cost you £1,949.72, but if you don’t have a spare 2 grand to lay down, you could buy £0.19 worth of a share. This is the type of account I recommend most to my readers and members of my course.
The ISA account is only available for those who are resident in the UK. If you are from outside the UK you won’t have access to this form of account, but you will still be able to access the others.
The ISA account says what it is on the tin. Open a tax free ISA which you can deposit up to £20,000 per year and choose your risk based on the investment options. There is no commission, no trade fee, and no charge for dividend reinvestment. You can start from £1.
Safety When Investing
As I mentioned above Trading 212 is FCA regulated and FCSC protected, so you don’t have to worry about the company running away with your money.
Another great feature Trading 212 has added are price limited and stop losses. This might not sound like anything new, but Trading 212 automatically calculates your stop loss to manage risk when day trading, and plan investments when investing long term. You can set your risk level, or the percentage of your account you want to risk (we recommend no more than 2%) and when you place a trade, the software will automatically calculate your stop loss so that if you do lose a trade, you don’t lose anymore than you allocate.
Signup Incentive
The only signup incentive Trading 212 offer is a free stock worth up to £100 once you deposit into your account. However this is only available in certain countries which are always changing.
This should not be a factor when you decide which brokerage to go with. But I still recommend Trading 212. If you want a free stock you can follow our unique link and the only catch is:
- You have to open an Invest account from your desktop or laptop
- Fund your account with as little as £1/$1/€1
- Then you should receive the free stock
If you open an account through our unique link, you will get your free stock. Then, once you deposit £1 or the equivalent currency, you will get a chance to join the affiliate program. Meaning you will have your own link to pass around and you can get more shares by referring more people. This is the way Trading 212 quickly grew their audience.
Platform Popularity
Trading 212 has a TrustPilot rating of 4.5 out of 5 based on the reviews on their website. You can check them out here.
But I did my own research by asking my online clients and Facebook group members what they though, and found this:
As you can see there is an overwhelming support of Trading 212 across my audience. This might seem forced data because I recommend Trading 212 and my clients and social media following trust me. But I want it to be clear that I would never recommend a product to someone without testing it myself.
You will see a video run through of my invest account further down so you can get a full user experience of the platform.
Education Resources
The Trading 212 app gives users free video tutorials on how to use it, basic fundamental analysis of stocks, and other basic investing knowledge. I have watched them and although they are for beginners they offer a wealth of knowledge that every investor should know before diving into the market.
As I mentioned before, the videos go over the basics of investing. You should consider doing more research and learning as much as you can before investing your hard earned cash.
As you can see there are 99 videos that you can watch and if you need a little more help… You can just check out our other blog posts!
You can find Trading 212’s terms and conditions here. Also you should read the FAQ pages on their website if you want to know more about the registration requirements.
The other educational tool is the Economic Indicators and Calendar. These functions give you the daily and weekly news updates as well as key dates to keep in mind when investing in certain securities.
Auto Pie Investing
Trading 212 has recently taken an idea from M1 Finance and started to allow investors to automatically fund accounts in the form of a pie.
You will be able to setup a pie, with as many as 100 stocks. Then all you do is set up a recurring amount each month or week to invest. Trading 212 does all the calculation for you, they invest your funds according to you objectives so the portfolio will be automatically balanced in line with your chosen allocation.
Copy Pie Investing
With the new pie investing features, Trading 212 also allows investors to share their pie’s with other app users. You can see what others are investing in, the annual return of their pie, and what allocations they set for each company.
You can then either save the pie for a later date, or copy it directly to your portfolio and start investing. You can check out my dividend pie here!
Account Setup
You will want to set up your account on the brokerage website because it can be complicated doing it straight from the app.
Just go to the Trading 212 website here and click on the button on the top right of your screen saying ‘Open an account’. Then you can choose either a ‘Real Money’ account or a ‘Demo’ account. Once you’ve chosen, you will need to enter your personal details such as:
- Country of residence
- Date of birth
- Tax identification number (if applicable)
- Then you will need to verify your identity by uploading a picture of your driving license or passport
Once you have been verified it’s as simple as depositing a bit of money from your credit card or bank transfer, then getting started.
How Trading 212 Differs From The Competition
Trading 212 has many features other commission free brokerages don’t offer, but the main difference is the user friendly interface. I don’t think I have come across a more diverse system on the market that is so widely available.
If you want to see my reviews of other trading apps check out the articles below.
Trading 212’s user experience
The user has access to all the features described above in a simple layout online or on a mobile device.
You can see from the platform above, you can save companies to your watchlist, see your current positions, see major information about certain companies, and search for over 1,400 securities worldwide. The education centre and economic calendar are available on the left, as well as any notifications such as price alerts and major news.
This is very similar to the mobile app.
You can access all of this information via the online website but I think the phone app is easier to navigate.
The verdict
My experience with Trading 212 was positive, there was no hiccups and very little wasted time during the setup of my accounts.
You can grab your free stock here!
Security and education provided with Trading 212 was superb, I think they make users feel safe when investing, and the customer service is fantastic. You can manage your portfolios down to 0.01% of an asset, and set yourself goals by ‘take profit’ limits and price action points.
I think for people in Europe this is the best commission free brokerage you will find. For those in the US, the best comparable brokerage app would be M1 Finance.
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