Australian citizens looking to trade shares in the stock market have a variety of options. Online brokers come with a diverse range of offerings, from discount to full service, while others are known for their trading tools or research.
The Australian Stock Exchange (ASX) is the 16th largest in the world, with $1.44 trillion in total market cap, according to Wikipedia. Depending on the broker, Australians also have access to some of the largest exchanges in the world, such as the NASDAQ in the United States. Australian brokerages are regulated by the Australian Securities & Investments Commission (ASIC).
In this guide, we will break down the best online brokers for Australians.
Best Online Brokers Australia
Here are Australia's best online trading platforms for share trading in 2020.
- CMC Markets - Best Overall
- IG Group - Best Trading Platform
- CommSec - Best Bank for Share Trading
- Interactive Brokers - Best for Professionals
- Westpac - Best Research
Through its offices regulated in major global financial centers, CMC Markets offers Australian traders a wide range of offerings with excellent pricing and its Next Generation trading platform, which is packed with innovative trading tools and charting. CMC Markets has also been rated as Canstar's Broker of the Year the past eight years.
Best Trading Platform - Visit Site
Founded in 1974 and respected as one of the most trusted brokers in the world, IG offers Australian traders low cost share trading with excellent trading tools, research, beginner trading videos, and access to more than 8000 international share CFDs. Read Full Review
Best Bank for Shares Trading
CommSec is one of the largest online brokers in Australia, providing trading access to 25 exchanges throughout the world. While its shares trading fees are expensive, CommSEC offers traders a variety of trading tools and market research.
Best for Professionals - Open an Account
While Interactive Brokers is not suitable for casual investors due to its complex platform, it is an international trading leader and offers low-cost commissions desired by professional traders. New and casual investors should be aware though of the miscellaneous fees and minimums charged by Interactive Brokers. Read full review
Westpac is a more expensive option for Australians. However, the broker provides access to 30 international exchanges, as well as offering free reports, a stock screener, stock recommendations, charting features, and the option for more premium research provided by Morningstar.
Other Brokers To Consider
- Nabtrade - 4.0 Stars - Nabtrade offers investors domestic and international trading at competitive prices, with customizable charting, third-party research from four different companies, real-time streaming, company stock and research, a global scanning tool, and more. However, Nabtrade's mobile app has terrible ratings in both the Apple App store and Android Play store.
- BellDirect - 4.0 Stars - If you are looking to trade domestic stocks only, BellDirect offers average pricing, with research tools that include consensus research from 20 brokers, daily trading ideas, free conditional orders, and html5 charting technology.
- ANZ - 4.0 Stars - ANZ runs off the popular CMC Markets platform, which means traders have access to the following tools: trading guides to assist first-time traders and trading platforms that offer live news updates, advanced charting, and a stock filter tool.
- Amscot - 3.5 Stars - Amscot offers traders below-average commissions with the established IRESSTrader platform (paid subscription required). Traders also have access to research, raising capital, and advanced portfolio reporting from third-party sources.
Online Trading Differences: Australia versus the United States
Share trading online in Australia is similar in many ways to trading as a US resident in the United States. Australian investors fund an account, make a deposit, then place trades through a web or desktop platform, manage a watch list, and conduct research, just as US investors do.
However, there are several important considerations of which Australian investors should be aware before selecting an online broker in Australia, considerations that are not a concern in the US.
- Commission ranges – In the US, it is rare to see an online broker offering varying commission structures, whereas in Australia most brokers have variable rates that depend on the total value of the trade. IG, SelfWealth, and Westpac are three that have fixed rates, although Westpac’s is much higher than the other two.
- Mobile app availability – While every online brokerage offers a mobile app in the US, in Australia not every broker does. Established brand names such as Nabtrade and BellDirect still do not offer a dedicated mobile app, even though mobile availability is becoming a bigger trend in Australia. One in six online investors have said that having a mobile version of an investment platform influenced their broker decision, according to a report from Investment Trends.
- Paying for research – In the US, most brokers offer premium research from providers like Morningstar for free. In Australia, brokers are more inclined to pass the cost onto traders and offer premium research on a monthly subscription basis.
- Order types – Market orders, limit hours, and stop orders are standard across the industry. However, trading US stocks from Australia can vary from broker to broker in terms of what is available. This includes after-hours trading. Advanced order types, such as conditional orders, will also vary from broker to broker.
How to Choose an Online Broker
Australian brokers work hard to stand out against one another beyond branding and marketing. What really matters though is the trading experience you receive once you are a client with a funded account.
Here’s a list of tips to keep in mind to help you select the right online broker the first time:
- Read the trading costs fine-print. Share trading fees can vary by trade amount, security type, quantity, exchange, among other factors. Before selecting a broker, view the full commissions structure and see how it fits into your portfolio size and trading frequency.
- Make sure your broker offers the asset class you want to trade. If you only trade Australian stocks, then no problem; any broker will service you. However, if you want to trade international stocks, options, forex, or futures, you will need to do select a broker that supports those offerings.
- For active traders, read the fine print to compare potential service benefits. Discounted trades are just one perk of being an active trader. Some brokers will increase the quality of the market data being streamed into the account. Others will grant access to better research tools or offer dedicated customer support.
- Customer service. When contacting a brokerage for account-related inquiries, all investors look for fast connection times and helpful representatives to assist them. Like all businesses, support quality and timeliness can vary. For a quick gauge, once you narrow down to two brokers, call both on the phone and ask them several questions. This speedy exercise may reveal a lot about what to expect as a client.
- Account Security. Is two-factor login available? What is the broker’s security policy? How are your assets protected and secured on an ongoing basis?
How do you trade stocks in Australia?
To trade stocks online in Australia, you must first open a brokerage account with an online stockbroker. Once your account is opened and funded, conduct research to determine which company's shares you want to buy. Then, use the trade ticket to place your trade and buy shares.
Which stock trading site is best for beginners?
There are several important considerations for Australian investors choosing a broker as a beginner. First, an easy to use website and trading platform are crucial to success. Next, low costs will ensure that you are maximizing your investment each time you buy shares. Finally, a robust set of trading and research tools will help you find the best stocks to buy.
What is the cheapest way to buy stocks?
To keep trading costs low for buying and selling shares of stock in Australia, use a discount broker. Australian banks are more expensive than standalone online brokerages. That is why our top finishers in our Best Online Brokers Australia 2020 list are not banks.
Are online stock brokers safe?
When buying and selling shares of stocks as an Australian citizen, it is crucial to use a regulated online broker. The major regulator in Australia is the Australian Securities & Investments Commission (ASIC). Using an Australian broker that is fully regulated protects investors in the case of fraud or bankruptcy.
Best Online Trading Platforms Australia (Summary)
|Online Broker||Best For||Mobile App||International Stocks||Cost ($10,000 trade) *As of 4/19/19||Overall Rating|
|CMC Markets||Best Overall||Yes||Yes||$11||5 Stars|
|IG Group||Best Trading Platform||Yes||Yes||$10||5 Stars|
|CommSec||Best Bank for Trading||Yes||Yes||$19.95||4.5 Stars|
|Interactive Brokers||Best for Professionals||Yes||Yes||$8||4.5 Stars|
|Westpac||Best for Research||Yes||Yes||$19.95||4 Stars|
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