I want to open a stocks and shares ISA. At present I have a sharedealing account with X-O (www.x-o.co.uk) and I’ve been making 1 or 2 deals per month. I’m approaching this as a long game and sticking with good companies. I am only planning in dealing in AIM shares at the moment.

I only want to trade in shares and I probably will only trade between up 10 times in a month (probably less). My portfolio will be under £25,000.

X-O still looks ok apart from the exit charges, but the cautious mentions here about price hikes in the future makes we weary especially with the exit fees. I’m young and learning so I want to have a decent amount of flexibility.

There is a decent comparison table here http://monevator.com/compare-uk-cheapest-online-brokers but it seems to lean more towards funds rather than active trading for someone interested in learning about investing in the stock market.

  • Believe I know a tool that can help you, but want to clarify before answering… (i) How much are you starting with & putting in per month? (ii) Not sure I understand your investment style. 1 or 2 deals/month, long game, sticking with good companies – all sounds like long term value investing. AIM shares, active trader, up to 10 trades a month – sounds like you're trying to exploit short term price movements. Asking because 10 deals/month sounds a lot for a sub £25k portfolio; most platform charges will take a huge % chunk out of that unless you are making stellar gains on short term movements – marktristan May 3 '16 at 15:23
  • At first lets say £10,000 and then £1,000 per month. Its still possible to check all the company fundamentals of AIM companies. I don't see AIM as more of a risk and my main strategy is not to exploit short term price changes unless I see an obvious opportunity. – Andrew Welch May 4 '16 at 7:46

I wouldn't only consider the entry/exit cost per trade. That's a good comparison page by the way. I would also consider the following.

  • How good is the platform uptime? you may expect it all to be 100%, buts not true!
  • What level of fundamentals data do they provide?
  • What sot of technical analysis do they provide?
  • Do they provide a "depth of market" screen? I personally find this to be very helpful in choosing the entry price on the day.
  • Do they provide "stock screening" facility within their site?
  • How 'quick' is their execution? Some online brokers have a poor reputation for delaying trades to save on brokerage, but still charging brokerage to you.

This depends if you are planning on using your online broker to provide all the information for you to trade. I have lower expectations of my online broker, not meant to be harsh on the online brokers, but I expect brokers to assist me in buying/selling, not in selecting.

Edit: to add to the answer following a comment. Here are three pieces of software to assist in stock selection

  • I don't know what you mean by 'depth of market' and 'stock screening' but I know where to find plenty of quality data on the markets without the sharedealing outfit providing it. If anything I don't want them to provide it to keep their costs down. – Andrew Welch May 4 '16 at 7:47
  • investopedia.com/terms/d/depth-of-market.asp - provides an idea of the number of buyers and sellers at various share prices. Stock screening is the process you would go through to screen the whole stock market, subsetting down to the ones you are considering buying. This is an automated process. I've updated my post with another post I put up last week with stock software recommendations. – Marcus D May 4 '16 at 8:17

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