Trading 212 Review: ISA, CFDs & More – Best Investing App?

Trading 212 allows people to invest in shares, exchange-traded funds (ETFs), commodities like gold, forex and contracts for difference (CFDs) all in one intuitive app. You’re also able to invest using an ISA to help maximise your gains through a tax-efficient account.

Their mobile app is currently number one in the UK with over 200,000 reviews and 15 million downloads. They entered the UK market in 2016 as a forex trading app and by 2017 were one of the first companies to offer zero-commission investing and have since gone from strength to strength.

If you’re thinking about creating a new account, then make sure to read this Trading 212 review to see if they’re right for you and which account type will suit your needs.

If you want to sign up for an account, go to Trading 212 below.

Trading 212 Account Types – CDF vs Invest vs ISA

When opening an account there are three types to choose from, ISA, Invest & CFD. Each account has their own set of unique qualities that will make them more suited to certain investors, below I’ll run through them.

Trading 212 Invest

This account type allows you to invest in over 3,000 shares and ETFs from all over the world. This includes companies listed in the UK, US, Germany, Netherlands, Madrid and Switzerland which give you more choice of investments compared to their closest rival, FreeTrade.

You can get started investing with only £1 and can do so with zero commissions, which is an excellent way to get started in the world of investing, especially when compared to other platforms that charge up to £12 per trade and high minimum monthly charges.

Trading 212 ISA

Trading 212 thankfully offer a stocks & shares ISA account through their platform. Each person in the UK gets an ISA allowance, and in the 20/21 and 21/22 tax years it is £20,000 per year. This allows you to invest up to £20,000 each tax year and all the returns generated from your investments are tax-free.

This tax-free return includes both dividends and capital gains that you earn from your investments. There also aren’t any fees for administration, commissions or dividend reinvestment too.

You can start investing with this account for as little as £1 and the ISA account is practically exactly the same as the Invest account, so try to focus on using up your ISA allowance first so you can keep more of your gains. This means it’s an excellent way to start your investment journey.

Trading 212 CFD

The CFD accounts lets you trade using contracts for difference (CFDs) which are effectively a bet on whether you think the price of an asset will rise or fall. This bet can be placed on most assets including stocks, forex and commodities and has the potential to be very lucrative.

However, due to the complex and often irrational nature of the stock market, reliably predicting the movement in the price of certain assets can be very difficult. As a result, this account type should really only be the most sophisticated of investors that understand the risks.

Trading 212’s own website claims that 76% of all of their CFD investors lose money so make sure you do your research before venturing into investment area.

Thankfully Trading 212 have a Negative Balance Protection Policy for retail investors which means you will never lose more money than you’ve initially deposited.

To start trading with this account there is a minimum of a £10 deposit and there is a currency conversion charge of 0.5%.

Trading 212 Fees

One of the biggest benefits of trading through Trading 212 is the fact they offer zero-commission trading. This means there aren’t trading fees which can be up to £12 with other brokers which can be a huge percentage of your overall investment, especially for people with lower value trades.

For example, those people investing £250 in one trade, with a £10 trading fee it would equate to a 4% cut of your overall investment meaning that your investment would have to rise 4% to just break even. That also doesn’t take into account any selling fees, which could also be £10 per trade, or if you want to invest into multiple investments to diversify your portfolio.

With Trading 212, there aren’t any trading fees. They make their money through the spread, which is the gap between the buy and the sell price of available assets. They do offer relatively tight spreads compared to alternative providers.

There is also a currency conversion charge of 0.5% and a stamp duty charge for share and ETF purchases. There are also no fees for withdrawing money from your account.

Is Trading 212 Safe?

Trading 212 is regulated for the Financial Conduct Authority meaning it has to comply with strict rules and regulations to keep your money safe. This includes holding your funds in a separate client account to separate it from their operational activities.

They’re also part of the financial Services Compensation Scheme, which means that up to £85,000 of your money is protected in the event Trading 212 becomes insolvent.

Any money you trade with and invest on the platform is done so at your own risk as asset prices can go up and down.

Best Trading 212 Features

There are a ton of great features that you’ll be able to utilise when you open account, and I’ll go through a few of them below.

Pies & Auto-invest – How Does it Work?

A pie is a collection of assets that you can select yourself, each being able to hold 100 securities. Each security is then represented as a slice of the pie and when you invest money into your pie, it will automatically split the money based on the percentages you selected.

For example, you could create a pie dedicated to the FAANG tech giants Facebook, Amazon Apple, Netflix and Google, and put each of them at equal weighting, so 20%. Now any money you invest into this pie will automatically be invested into these 5 companies.

The only condition is that the companies you select have to allow you to purchase fractional shares, which means that you don’t have to buy a full share at a time. I explain fractional shares in a bit more detail below.

You can also combine this pie feature with another great feature called auto-invest. This is where you can schedule investments to automatically deposit money into your account based on your investment preferences.

This takes all the effort out of remembering to invest so you can set yourself up for success. This feature can be disables or changed at any time.

Fractional Shares

Fractional shares are an excellent feature that allows you to invest in a company without having to buy a full share. This drastically lowers the barrier for people to get into investing, with some stocks being thousands each, for example, Berkshire Hathaway shares are over $350,000 each.

This also allows you to make use of the pie investing feature that I’ve highlighted above.

Within the app settings, there is an option to toggle fractional shares on so you can see a small F against the logo when you’re searching for companies to invest. This makes it a lot easier to see which ones offer the feature.

Community & Tutorials

The community within Trading 212 is a very useful resource to get started. It includes discussions on investing strategies, market trends and also includes useful video tutorials. They also have a great YouTube channel with over 500,000 subscribers and hundreds of videos helping you make the most out of the platform.

If you are new. to investing and want some quick guidance, make sure to read this post on how to invest in the stock market for beginners.

Referral Codes – Free Share Promo

Trading 212 are currently offering a free share to people that open an account that is up to £100 in value. To find your link you can go into your account and tap on the “More” menu tab and you should. be able. to see the “get free shares” option.

You will get your free share within 3 business days after your friend has verified and funded their account with the minimum deposit.

Customer Reviews

Trading 212 is currently the UK’s number 1 trading and investment app with over 15 million downloads and 4.7 out of 5 on the Apple store and 4.5 out of 5 on Google Play.

Many of the reviews highlight how they love the commission free trading and cite how they were charged a lot on their previous platforms. They also mention how intuitive the app is to use with a lot of useful features.

There are a few negative reviews around setting up accounts being slow, which is to be expected from their recent influx of new customers. They have released a statement saying they’re increasing their customer support capacity, so that should be fixed very soon.

Trading 212 Alternatives

When looking at alternatives to Trading 212 you have to know what functionality you’re wanting to use to allow you to more effectively compare platforms.

The best way to separate this is by the different account types offered, the Stocks & Shares ISA account, share dealing account and CFD trading account. Below I’ll highlight some of the best alternatives so you know where to focus.

Stocks & Shares ISA Alternatives

• Interactive Investor
• Moneybox
• AJ Bell
• Nutmeg
• Hargreaves Lansdown
• Fidelity
• Legal & General
• Saxo Markets
• Vanguard

Share Dealing Alternatives

• eToro
• Hargreaves Lansdown
• Degiro
• Fineco Bank
• Interactive Investor

CFD Alternatives

• eToro
• City Index
• XTB
• ActivTrades
• CMC Markets

Verdict

Overall Trading 212 is an excellent investing app, especially for beginners with their zero-commission trading, intuitive app and great guidance and tutorials.

One feature for the UK market that makes them stand out for me personally is their ISA account that lets UK residents make use of their £20,000 ISA allowance to help shield gains from tax.

If you want to get started, head over to Trading 212 and open an account in a few minutes.