In my twenties, I eagerly ventured into the stock market with my bank’s brokerage account, only to face high commissions and make investment errors. This experience taught me valuable lessons about timing, risk, and diversification. It also highlighted the importance of costs, like brokers’ fees, in investing.
To help beginners avoid these pitfalls, I’ve compiled a guide on top online brokers, outlining their pros, cons, and fees.
Why Can You Trust This Article?
I’m passionate about the finance world and have been testing the most popular brokers for years. Additionally, our unique methodology uncovers each broker’s pros and cons, thoroughly examining their costs. This is combined with our regular content updates and expert authors.
Josep GarciaFinancial Advisor
Be prepared, as this guide is extensive. But if you’re short on time and just want to get straight to the recommendations, here’s a brief summary of the best brokers for different needs:
Let’s get down to business and help you find the broker that best suits your investment style.
Best Brokers for Beginners: An Overview
Platform
Facts
Summary
2.5 million users.
10,000 stocks.
Trading 212, popular among European investors and boasting 400,000 + users. It’s well-designed and highly intuitive, making it suitable for beginners. It offers fee-free investing in Stocks and ETFs. It doesn’t include certain assets, such as crypto or bonds and others.
32 million users
3,000 stocks
300 ETFs
eToro’s known for its user-friendly platform, offering quick account setup and access to a wide range of markets for fractional stocks and ETFs. Users can also invest in cryptocurrencies.
2.5 million users
50 + Exchanges
DEGIRO, regulated in the EU and UK, is known for its user-friendly platform and extensive ETFs and shares offerings. It’s available in select European countries but not in the US, Canada, and others. Note the accumulating fees.
800,000 + users
3,000 + stocks
150 + ETFs
XTB, based in Poland, offers fee-free trading in stocks and ETFs, featuring a broad range of assets with full or fractional investing. However, it has a less intuitive interface, a limited demo account, and doesn’t serve US clients.
Interactive Brokers
2 million users
150 markets
Interactive Brokers, serving many countries, offers investment in diverse assets. While its global reach is a strong point, the platform can be less intuitive and somewhat difficult for beginners. The wide array of offerings, though advantageous, might also be a bit confusing to newcomers.
330,000 + users
2,800 + CFD
Plus500, a specialized CFD broker, provides a wide range of CFD options not ideal for beginners. Be aware of its inactivity fee.
400,000 + users
1,500 + CFDs
AvaTrade focuses on CFD trading with fixed leverage and a selected asset range, potentially challenging for novices. The platform isn’t the easiest to navigate, although it supports multiple deposit methods. However, asset options are limited.
Users not disclosed
2,250 + CFDs
IC Markets presents a steep learning curve and needs external platforms like MetaTrader or cTrader. Its investing platform is fairly outdated. While it focuses on CFD trading with fixed leverage, it also offers algorithmic trading.
250+ assets
IQ Option, exclusive to derivatives, features a well-designed interface and a substantial demo account. Despite limited asset choices and fixed leverage, it offers excellent charting tools.
What Is A Broker?
A broker, either an individual or an organization, acts as an intermediary in transactions, particularly in finance for trading assets like stocks. Yes, the midleman.
Brokers, likened to matchmakers, connect you to parties for buying or selling assets, like Apple shares. Some, like Plus500, act as market makers, trading directly with you. Brokers charge a commission or spread for their services.
Why Do I Need A Broker?
Good question!
A broker is essential for trading on the stock exchange, acting as a platform to buy or sell financial assets.
Imagine this: you get a lucky $500 tax refund and decide to invest it in shares, like Intel.
But how do you go about investing that money in Intel?
You could try knocking on doors in your neighborhood, asking if anyone owns Intel shares and wants to sell them at a fair price.
But, let’s be real, that’s not really an option.
Instead, brokers step in to connect you with fellow investors who are ready to trade (buy or sell assets) with you. Sometimes, they even handle the trading themselves.
Just like most of us don’t go directly to the farmer for potatoes, cabbages, eggs, or lettuce – think of the shopping hassle! That’s where brokers step in, acting like a supermarket for your financial needs.
The Best Online Brokers For Beginners
Discover top brokers offering insights into the current market. Remember, specialization varies; some excel in derivatives like CFDs, others in assets like shares or ETFs.
Trading 212
Trading 212 stands out as a beginner-friendly broker, renowned in the UK, France, and Germany for its easy-to-use platform that boast 2.5 million users.
Geared towards the European and American markets, Trading 212 offers a variety of investment options, including real and fractional shares and ETFs. Its compatibility with iOS, Android, and web browsers like Safari and Chrome enhances accessibility. However, it doesn’t support external trading platforms like MetaTrader or cTrader.
What I Like About Trading 212:
- This platform’s intuitive design streamlines the trading experience, offering a seamless account setup and a user-friendly interface, ideal for beginners.
- Trading 212 attracts new investors by eliminating trading fees on stocks and ETFs, making it a cost-effective choice for budget-conscious traders.
- As a broker regulated by the EU and UK authorities, it ensures a secure and compliant trading environment.
- The flexibility to set up accounts in USD, GBP, or EUR allows traders to manage their investments in a preferred currency, reducing potential foreign exchange issues.
What They Should Improve:
- The lack of social investing features on Trading 212 might deter traders who value community insights and copy trading opportunities.
- Its support materials are somewhat limited, which may leave users seeking more in-depth guidance or advanced trading support.
- Without algorithmic investing options, Trading 212 may not appeal to traders interested in automated or high-frequency trading strategies.
- The exclusion of US clients restricts the platform’s global reach, limiting its accessibility to a significant market of potential investors.
If you’re residing in Europe or the UK and have an interest in the world of stocks and ETFs, an intuitive online broker could be a valuable resource for you. This platform makes investing more accessible and user-friendly, especially for those new to the financial market.
eToro
eToro is a renowned market maker established in 2007 (initially RetailFX) in Israel. It has expanded globally, with offices in the UK, US, Australia, and Cyprus. With a massive following, eToro ranks among the top broker choices, boasting an impressive 32 million registered users.
Their marketing efforts include partnerships with celebrities like Kristian Nairn (Hodor from Game of Thrones) and Alec Baldwin. Not to mention their omnipresence in online ads, including YouTube, all while catering to millions of users.
What I Like About eToro:
- Regulated by reputable authorities in countries like Cyprus and the United Kingdom.
- Boasts an intuitive platform, a user-friendly smartphone app, and a handy demo account for practice.
- Allows you to invest by mirroring other investors for inspiration – copy trading.
- A vast array of asset classes is available for trade, including fractional shares, ETFs, and cryptocurrencies.
- eToro offers the option to invest with or without leverage, unlike some other market makers such as XTB.
What They Should Improve:
- A relatively high initial deposit is required; you won’t be able to deposit less than $10.
- Withdrawal commissions may apply in certain cases.
- It lacks a news feed to help you stay informed about your investments.
- Spreads could be a bit lower.
Investing in fractional shares and ETFs is a strategic option for long-term investors seeking affordable access to real assets, sans trading fees. It’s worth exploring, though fractional shares have their unique aspects. Additionally, there’s the option to mirror other traders in real time, but please, take time to study and grasp the associated risks before diving into trading.
eToro is a multi-asset investment platform. The value of your investments may go up or down. Your capital is at risk.
DEGIRO
DEGIRO, an extremely popular broker in Europe founded in 2013, is based in the Netherlands. It’s been gaining popularity and currently serves well over 2.5 million clients in 18 different countries, primarily in Europe.
DEGIRO enables online trading in numerous markets, including the United States, United Kingdom, Germany, France, Spain, Australia, Japan, and more. You have the flexibility to trade with or without leverage. Additionally, they offer a promotion allowing commission-free trading of select ETFs once a month when you invest a minimum of $1,000.
What I Like About DEGIRO:
- Opening an account with DEGIRO is effortless, and its platform is user-friendly.
- DEGIRO is regulated by multiple financial authorities, including the German BaFin and De Nederlandsche Bank.
- DEGIRO offers a diverse range of tradable securities, including stocks, ETFs, bonds, options, and futures from markets in the US, major European countries, Asia (e.g., Hong Kong, Singapore, Tokyo), and Australia.
What They Should Improve:
- It’s not possible to trade some assets such as CFDs, Forex or Cryptocurrencies.
- There is no demo account for you to practice with, but opening a regular account is free of charge. Of course, you can’t practice as you would with virtual funds.
- Unfortunately, DEGIRO is limited to clients in the United Kingdom and select European Union countries. It’s unavailable for those in the United States, Japan, Singapore, Australia, and similar regions.
DEGIRO appears to be a solid choice for both beginners and experienced traders. It’s simple to use, yet offers various order types (like stop loss) and research tools that appeal to advanced users. However, it’s not the top choice for trading derivatives.
Interactive Brokers
IBKR, a US-based group with over 40 years’ experience in the financial sector, serves over 2 million customers. They promise low fees, user-friendly tools, and a wide variety of assets and markets. But, does it all hold true?
It maintains an official presence in countries including the United States, Luxembourg, the United Kingdom, Canada, and Japan, thus being supervised by numerous institutional bodies in these serious countries.
What I Like About Interactive Brokers:
- Available in numerous countries, including the US, Canada, UK, Japan, Australia, Brazil, and many European countries.
- Offers a wide range of products, including stocks, ETFs, mutual funds, bonds, currencies, and derivatives like CFDs and futures.
- Provides access to 155 markets and countries with support for 26 different currencies on its platform.
What They Should Improve:
- The app’s user-friendliness and the account opening process could be simplified.
- The commission system might be complex, given the extensive range of features, assets, and markets.
- Full platform access requires downloading software, and the web/mobile versions might miss some desktop features, like trading specific instruments such as bonds, warrants, or futures.
Interactive Brokers suits both experienced investors (e.g., for derivatives trading) and those looking to trade stocks, ETFs, funds, or fixed income assets.
XTB
Founded in Poland in 2002, it operates in many countries, including the UK, Germany, Italy, France, and Spain. Offering extensive market access, its comprehensive investing platform features various options and tools, such as robust charts for technical analysis.
XTB enables trading in CFDs on shares, ETFs, indices, Forex, and commodities. In select countries, trading in real shares and ETFs is also available. Its offices are located in various countries, including the United Kingdom, Spain, Germany, and France.
What I Like About XTB:
- Registered with the UK FCA and other regulatory bodies in Spain, France, Germany, and Portugal.
- Opening an account is easy. There is also a demo account where you can test the platform with fictitious money.
- Fast fund additions via credit/debit card, bank transfer, Skrill, PayPal, and other e-wallets.
- Spreads seem to be among the tightest in CFD trading.
- XTB offers trading in both real assets like stocks and ETFs, and CFDs. Additionally, you can trade fractions or full assets.
What They Should Improve:
- There is a minimum deposit of $250.
- Derivatives trading requires leverage, but stocks and ETFs can be traded without it.
- While the platform offers numerous options, this added complexity can make it more challenging to use compared to others.
XTB caters to serious traders in derivatives, requiring a minimum deposit of $250. It’s also for those interested in stocks and ETFs, though availability varies by country.
IG Broker
Founded in 1974 and boasting over 200,000 clients globally, IG Broker ranks among the world’s most popular brokers. Offices are located in the United Kingdom, Germany, the United States, France, Japan, Singapore, and Spain.
As a market maker, it specializes in CFDs, offering over 17,000 assets for trading. However, competitors like XTB and eToro offer more diverse product portfolios.
What I Like About IG Broker:
- A prominent broker with over 200,000 users, showcasing a longstanding tradition in finance.
- IG doesn’t impose a minimum deposit when opening an account.
- Intuitive, featuring numerous charts and analyses for use.
- Includes a demo account for practice and testing brokerage skills.
- Available in multiple countries, including the USA, UK, Japan, Singapore, Spain, France, Germany, Holland, and Italy.
What They Should Improve:
- An inactivity fee is charged if no trading occurs for 2 years.
- More suitable for derivative traders than for stock trading.
- Multiple account types with varying spread levels and features can be confusing.
- Spreads may not be the most competitive at present.
Ideal for intraday traders seeking advanced features like charting and specific order types, such as stop-loss. If you have no trading knowledge, I would suggest you look for another alternative with which to trade real assets such as stocks, ETFs, funds or bonds.
AvaTrade
AvaTrade, operating since 2006 as a derivatives broker, has gained the trust of 400,000 + clients to invest their money. AvaTrade enables trading in various CFDs, including stocks, currencies, ETFs, cryptocurrencies, indices, and commodities. However, buying and selling underlying assets like stocks, ETFs, or fixed income isn’t possible.
What I Like About AvaTrade:
- Opening an account with AvaTrade is 100% online and fast.
- The spreads on their CFDs appear to be tight.
- They have a trading calculator that will help you understand how much you will pay in commissions on each trade.
- This broker is regulated in several major countries, including the UK, Ireland, Australia, Japan, and South Africa.
What They Should Improve:
- It doesn’t have the widest choice of markets and instruments for CFD trading.
- It’s unavailable in certain countries, including the United States and Canada.
- AvaTrade is only able to trade derivatives.
- Its charting system could be more comprehensive.
- AvaTrade charges a very high inactivity fee.
It’s a suitable choice for those seeking a CFD trading broker, though it’s worth noting their range of markets and instruments isn’t the broadest. – e.g. eToro and XTB offer more.
IC Markets
IC Markets, founded in 2007, is an online forex and CFD broker based in Sydney. Offering over 2200 CFD assets, this broker includes stocks, currency pairs, indices, commodities, and cryptocurrencies. As IC Markets lacks its own platform, you’ll need MetaTrader or cTrader for trading.
What I like About IC Markets:
- Serving clients globally, IC Markets operates in many countries, including the UK, Australia, Germany, France, and LatAm.
- Regulated in multiple regions, including the UK, Australia, and the EU, IC Markets adheres to diverse standards.
- Opening a demo account with IC Markets is straightforward, and they’re also flexible.
- Trading options include social trading via Zulu Trade and algorithmic trading using programming
- The broker supports various currencies such as USD, EUR, AUD, JPY, and GBP.
What They Should Improve:
- Limited to CFD investments, it’s not suitable for those interested in real stocks, ETFs, bonds, etc.
- The interface, particularly MetaTrader 4, 5, and cTrader, is notably outdated.
- The range of instruments is limited compared to other platforms.
- Account security could be enhanced, notably by adding 2-factor authentication, and revising how usernames and passwords are delivered.
Who Should Use IC Markets?
Best for experienced traders, IC Markets is less ideal for beginners and long-term investors due to its focus on CFDs and steep learning curve.
IQ Option
IQ Option is undeniably among the prominent players in the online brokerage industry, boasting over 20,000 trades per day. It maintains a presence in 31 countries, including the UK, Germany, France, Italy, Portugal, and Spain.
IQ Option is headquartered in Cyprus, and its operations are regulated by the Cyprus Securities and Exchange Commission (CySEC). Additionally, the broker is registered with reputable regulatory authorities, including the British FCA, the Spanish CNMV, the Italian Consob, and the French Regafi, among others.
What I like about IQ Options:
- Professional platform with many options for charting and analysis.
- Investing economically in various financial markets (like stock exchange, Forex, cryptocurrencies) is feasible using derivative products.
- Regulated by many countries
What They Should Improve:
- Trading without leverage is not possible on IQ Option.
- Only derivative trading (with CFDs) is possible, not ideal for beginners or investors who don’t understand the risks.
- Offers fewer markets and assets than other trading platforms.
- The web platform tends to be somewhat slow.
- Unavailable to clients in the US, Australia, and Israel.
This platform is ideal for seasoned short-term investors seeking a fast and cost-effective way to invest in derivatives.
Types Of Brokers
There are many ways to classify different brokers, but for simplicity, they can traditionally be divided into two categories.
Market Makers
Market makers create a unique market for clients (investors) to trade in. Consequently, trades don’t reach the interbank markets. Orders are executed internally, with prices based on client supply and demand.
The market maker acts as your trading counterpart. They take the opposite position to your order: if you buy, they sell; if you sell, they buy.
Typically, market makers don’t charge trading commissions. They earn from the spread – the difference between their set bid and ask prices.
Example:
Imagine buying Apple shares via the fictional broker MarketMaker Inc. They offer a bid price of $117.66 and an ask price of $117.70 for clients. The $0.04 difference is the spread, which is how the broker makes revenue, besides various service fees.
You might know IG Broker, IQ Option, XTB, or eToro – some of the most popular market makers currently.
Advantages of market makers:
- Provide liquidity for buying or selling anytime.
- Offer user-friendly and often cost-free trading platforms, although inactivity fees may apply.
- Usually don’t require much capital to start investing.
- Lower costs and quicker trades than non-market maker brokers, ideal for derivatives trading
Disadvantages of market makers:
- Potential conflicts of interest, as they profit from user losses by being the counterparty.
- Mainly offer derivatives, riskier and more complex than equities, not ideal for novices.
- Set bid and ask prices to profit from spreads, which may be wide in rare cases, reducing profitability.
- Often require trading with leverage, meaning borrowing from the broker.
Many reputable brokers are market makers. If they practised fraud, they wouldn’t have a large user base. It’s wise to choose brokers regulated by trustworthy countries, like EU members, Japan, the United States, or other countries you trust.
STPs and ECNs (Non-Dealing Desk)
These brokers connect buyers and sellers, enabling the purchase and sale of financial assets.
You won’t buy or sell assets directly from these brokers. Instead, they link you with other investors or liquidity providers, like investment banks. They’re not your trading counterpart; they simply facilitate asset trades between two parties.
Advantages:
- They offer direct market access, ensuring asset prices closely mirror real market values.
- Unlike market makers, they pose no conflict of interest, as they don’t trade with you but merely facilitate trades.
- This type of broker often offers the opportunity to trade real assets rather than derivatives
- Often, they enable trading in real assets instead of derivatives.
- Generally, trading without mandatory leverage is possible.
- You should be able to transfer assets from one broker account to another one.
Disadvantages:
- Slightly higher commissions may be charged, as this is their main income source.
- Minimum capital requirements to access their platforms may be imposed.
- Liquidity might not always be high due to reliance on matching buyers and sellers.
Things To Consider When Choosing A Broker
Before deciding on a trading platform, it’s essential to understand key factors.
Commissions
Choosing a broker requires considering commissions and fees, which significantly impact overall returns. Here are the main types of commissions you may encounter:
- Annual commissions: Some brokers charge an annual fee for account maintenance, although this is relatively uncommon.
- Inactivity Commissions: Some brokers assess inactivity fees if no trades are made during a specific period, like a quarter.
- Trading Commissions: Brokers often charge a commission for trading securities like stocks. However, some, especially market makers, don’t charge a separate commission, earning instead from the spread between bid and ask prices.
- Foreign Exchange Commissions: Trading in currencies other than your broker account’s base currency (like buying shares in Japanese yen) may lead to foreign exchange commissions.
- Funding Commissions: Requesting money for trading or failing to add funds to a negative account incurs a commission from the broker for the loan. Remember, these are charged daily and can accumulate significantly.
Leverage
Leverage, often used by investors like day traders, amplifies trading positions beyond the funds invested with the broker.
For example, if you invest $10,000 in the Forex market with only $1,000 as margin at the broker, your risk isn’t limited to $1,000. Your exposure and potential losses are based on the entire $10,000 investment, even though you only deposited $1,000 as margin.
Be cautious, as leverage can be risky if not understood properly. If the market moves against you, you’ll need to deposit more funds to maintain the margin. Failing to do so on time results in financing commissions, akin to interest charges on a loan from the broker.
Ease of Use
Trading platform usability is critical for your overall experience. It should be user-friendly and meet your specific needs.
It’s always good to check out the demo account, if available. Here, you trade with fake money – not thrilling, but it’s a safe way to learn without risking your capital.
Security and Accounts
Broker security is a controversial topic, and it’s tough to determine a broker’s security level. I typically consider a few factors:
- Are they regulated by a reputable country? For instance, is the broker in a loosely regulated distant country, or in a state with stringent financial legislation (like the USA, EU, Japan, Australia, etc.)?
- Are they a publicly listed company? While not a complete guarantee, a stock exchange-listed broker must disclose their accounts and undergo audits, offering additional reassurance to users.
Graphics and Analysis Tools
Many advanced users, particularly traders, seek a tool for drawing charts, projecting charts, and performing calculations. Ensure the platform you’re considering has all the features you need in a broker.
Additionally, check if they offer comprehensive tutorials. A broker with many features but without guides to explain them isn’t very practical.
Order Executions
Brokers have several options for investors when it comes to executing orders, so you don’t have to monitor the stock market continuously to determine when to enter or exit trades.
The most typical orders are:
- Market: This is the fastest way to instruct your broker to buy or sell an asset.
- Limit: These are orders in which the investor specifies the price at which they are willing to buy or sell. If a bid is found at that price, the order will be executed.
- Stop Loss and Stop Profit: These are price levels that determine when an order is executed to safeguard against market fluctuations. For instance, if you set a Stop Loss order at $99 for Apple shares, your broker will automatically sell your Apple shares if the price drops to that level – Stop Profit functions similarly.
- Dynamic Stop: The sell level of your order adjusts as the market moves in your favour. In other words, the price of your stop loss is calculated based on the asset’s price evolution.
Deposits And Withdrawals
Finally, you should ensure that you are aware of the methods your chosen broker offers for depositing and withdrawing funds from your account.
The most common methods include charging your credit card, bank transfers, or electronic payment options like PayPal or Skrill.
Additionally, you should consider the speed at which these funds are processed. For instance, if your account balance is negative, you may incur commission charges. To prevent this, it’s advisable to use the quickest deposit methods, such as PayPal or credit card, which are typically faster than bank transfers.
Available Markets
It’s vital that your broker operates in the markets you’re interested in investing in. For instance, if you’re focusing on US stocks and your broker doesn’t operate in this market or offers limited assets, it’s a poor choice.
Generally, most brokers let you buy major assets from key markets, like stocks from the S&P 500, European, or Asian markets.
Conversely, if you’re interested in niche investments like specific ETFs or shares from lesser-known companies, you’ll need to research to find the right broker.
Consider a financial market as a forum where assets are traded between buyers and sellers. Below, we’ll explore various asset classes, like stocks, bonds, currencies, and derivatives.
An example of this:
In Barcelona, where I live, card enthusiasts meet weekly to trade cards. They have varied interests, from Pokemon to football, and even Harry Potter cards. Obviously, Barcelona isn’t unique in this aspect. Cities like Manhattan, London, Rome, Berlin, or Paris also have spots for trading cards.
Financial markets are quite similar.
Main Financial Markets
There are many types of financial markets, depending on the type of asset being traded. But the most important are:
- Money Market: This is where money and short-term assets are traded. It’s a wholesale market for large institutions and investors, known for its high liquidity.
- Capital Markets: These aim to raise capital for companies through shares and debt (medium to long-term), with higher risk. They include fixed income (e.g., shares) and equities (e.g., bonds).
- Foreign Exchange Market (Forex): Here, participants trade different currencies. For example, you can exchange euros for dollars.
- Bond Markets: Public and private entities use this market for financing. Investors can buy public debt, usually as fixed income securities.
- Financial derivatives market: This is a market where complex financial products, known as derivatives, are traded. These products don’t have intrinsic value, but rather depend on other assets. For instance, we can have a derivative product like a CFD on Tesla shares. The price of this CFD will depend on the price of Tesla shares, but it’s not equivalent to owning actual Tesla shares. We’ll delve deeper into these products in the next few paragraphs.
However, it’s essential to remain cautious, as these risks may not completely vanish, regardless of the market’s level of regulation. For instance, the cryptocurrency market remains unregulated, which is why it appears to carry a higher level of risk.
Available Financial Products
Various financial products are available for investment, categorized into fixed income and equity products.
Fixed Income
Fixed income assets, paying known interest over their lifespan, are a lower-risk choice, suitable for security-seeking investors. Although theoretically lower risk, they’re not risk-free and may involve default, liquidity, or interest rate risks. They can be public (like government bonds) or private, with foreign currency fixed income products carrying exchange rate risk.
Equities
Equity investments, offering an unknown return, carry higher risk than fixed income investments. Popular equity assets include shares, with separate categories such as Forex, cryptocurrencies, and derivatives.
- Shares: Investors buy shares to become partial company owners, with returns from dividends or sale price differences.
- Forex: This involves trading currencies, speculating on price fluctuations, usually with leverage and short-term trading.
- Mutual Funds: These pool money from multiple investors to invest in various assets, both equities and fixed income, offering diversification.
- ETFs: Very similar to mutual funds, but you can trade them at any time, unlike mutual funds. ETFs generally invest in some sort of index.
- Cryptocurrencies: Investments in digital currencies like Bitcoin are highly volatile and less regulated.
- Derivatives: Complex products like futures, options, swaps, and CFDs depend on underlying assets and are high risk.
What Types Of Assets Should I Invest In?
Consider index products that track financial indices. They often outperform managed funds long-term, have lower operating costs, and offer high diversification. Invest in index products through brokers like XTB or eToro, or consider a roboadvisor for simplicity.
Final Thoughts On The Best Brokers for Beginners
I hope this guide has helped you decide what type of broker you need and assess the different alternatives available in the market.
Remember, investing always involves risks. Here’s a basic piece of advice: Don’t invest in what you don’t understand. If you have questions, feel free to leave a comment below; I’ll try to help.
FAQ
A trader is someone who invests in the financial markets (i.e., an investor), while a broker is the agent or platform bringing investors together to facilitate asset trading.
Basically, no. With market makers (e.g., eToro, XTB, and similar brokers), the investment platform takes the opposite role in your investment (if you buy, they sell, and vice versa). They might profit more if you lose money. However, if they manipulated accounts or played against you, investors would likely stop using them. Still, a conflict of interest could exist.
If you’re keen on investing in the stock market and selecting your assets, yes, you’ll need a broker to facilitate these investments. If this seems too complex, consider simpler options like robo-advisors.