When it comes to investing, deciding the stocks or bonds you want to buy is sadly only half the battle. Investing successfully also means choosing the right trading platform to implement those decisions. If you do not select the right online platform for you, you run the risk of not being able to invest in what you want, when you want.
We’re going to look at how to choose the right online investment platform for you. We also outline why getting the right platform is so important. In doing so, you should be able to pick out an online platform that is perfect for you, right from the start.
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Why choosing the right online platform is key
It may sound over the top to say that choosing an online investment portfolio is just as important as any single investment decision. However, it is essential to use an effective platform right from the beginning. Getting the right online platform for you and your needs is crucial to making any investment decision.
Investing is a complex activity, so you need a platform that you can use. You also need a platform that offers the products you want to trade. Many of us will wish to have a multi-asset portfolio. To be able to construct one, you need an online investment provider that offers many assets.
How to choose the right platform for investing
When researching online investment platforms, consider them with the following factors in mind. You will need to do so with your money and your circumstances in mind. Some providers will be better suited to you than others.
Fees
Some providers offer all bells and whistles on their platform - but at a cost. For example, a platform may be able to be customised to a high degree or offer extensive research libraries. Those costs will often be high fees placed on every trade you make. As a result, those fees can materially impact your overall return - even when you make an otherwise brilliant investment. Different brokers charge and structure their fees in different ways - so make sure you know how any potential platform you use makes their money.
Software
The software that an online platform provides is one of the key ways it can differentiate itself from its peers. Some companies will have a modern or high tech platform, while others may have something more fundamental. The critical thing to remember when choosing a platform is picking one whose software works best for you. It may be that you need an advanced user interface to help make investment decisions through the use of charts or graphs for technical analysis. However, you may just want to place trades through a platform and little else. Whichever investor you are (and anything in between), ensure that the platform you choose has software that you can leverage to your advantage.
Product range
You may only want to invest in a small number of asset classes. Or you may want to invest in a broad range. Either way, it is crucial for you as an investor that the online platform you choose, offers the assets you want. If a platform doesn’t, but in every other way is what an investor is looking for, it will never be a suitable platform to invest through. Additionally, it can be beneficial to find specialists when it comes to asset classes you know you will invest heavily. For example, Hargreaves Lansdown is a specialist in trading UK stocks.
Processes
An online platform has to have a sleek and professional interface to place trades through. However, it is also essential that the company behind it has efficient processes too. If a company does not have efficient processes, tasks such as setting up an account or making withdrawals can be arduous. And they need not be. A professional trading platform will be able to perform day to day tasks without any issues. Read customer reviews during your research. In doing so, ascertain whether your prospective platform is capable behind the scenes.
Customer service
There will be cases with every company where a customer needs help. Its customer service, therefore, needs to be fast and useful. If lacking, you can be left with a sour taste in the mouth. Additionally, it can materially impact their ability to invest efficiently. Again, the competence of a company’s customer service can be understood by reading customer reviews.
Regulation
Check that your potential platform has not had any issues in the past with any regulators and ensure the FCA has not found any regulatory breaches with a company. If they have, investigate what that breach was and if it has been addressed. It could be that the breach is not something that concerns you or it could be that it has been rectified, so it’s no longer an issue. You need to be sure that your money will not be used in fraudulent or illegal ways but invested just as you want it to be.
Choosing the best online platforms
Not even the best online platforms are suitable for all investors. For that reason, you must research a prospective trading platform with your specific needs in mind. Looking at the above factors with these in mind will ensure you choose the best online platform for you.
