How did we choose our best stock brokers in Australia?
The most important factor for us to consider when choosing the best Australian stock brokers was that they are regulated in Australia by the Australian Securities and Investments Commission (ASIC). Once the brokers regulation had been confirmed, we then researched and analysed the brokers stock trading service in great detail and assigned them with an unbiased stock brokerage rating based on our own findings. During this research, we gave great consideration to what we deem to be amongst the most important factors to consider when choosing an online stock trading broker, including:
- Regulation: A stock broker should be regulated by ASIC to provide online stock trading in Australia.
- Stock Trading Platforms: The stock broker should have a range of the best stock trading platforms with user friendly interfaces and trading tools for analysing the stock markets. The platforms should be compatible on desktop, web and mobile devices for trading stocks whilst on the move.
- Stock Trading Instruments: The stock broker should offer a large selection of global stocks in different markets for trading online.
- Spreads: The stock brokers spreads should be competitive, the tighter the better.
- Commission: The commission charged for trading stocks should be priced low.
- Fees: Other fees such as those charged for deposits, withdrawals, account inactivity, holding positions overnight, etc, should all be made clear.
- Execution Speeds: Traders buy or sell stock positions should be entered with minimal slippage.
- Liquidity Providers: The stock broker should incorporate top tier liquidity providers (LPs) in order to offer a deep liquidity pool to traders.
- Stock Trading Tools: There should be a good selection of trading tools for analysing the stock markets, planning/managing stock positions, stock trading signals, social trading, etc.
- Educational Materials: The stock broker should offer traders a range of educational resources on various stock trading topics to help them improve their trading skills and knowledge. Training tools can include video tutorials, stock trading guides, webinars, etc.
- Stock Trading Accounts: The stock broker should offer a choice of flexible trading accounts to cater for different levels of investment and experience levels.
- Account Deposit & Withdrawal Options: There should be a choice of convenient account funding methods, including online payment processors for fast and easy account funding.
- Client Support: The online stock brokerage should offer efficient and well-educated client support in order to respond in a prompt and efficient manner to all general and technical questions that traders may have.
Australian stock brokers regulation
Stock trading is a popular form of online trading that enables the trader to speculate on the rising or falling prices of a particular company or basket of selected stocks known as Indices. An online stock broker acts as the intermediary between you the trader and the exchange where the stocks are traded. Anyone can open a trading account with an online brokerage and use their online stock trading platform to buy and sell stocks. In recent years, online stock trading has continued to increase in popularity and with so many Australian stock brokers to choose from, it can make it difficult for traders to choose the best stock brokers in Australia for them.
For us here at Trading Brokers, we believe that one of the most important things to consider when choosing from the best Australian stock brokers, is that the brokerage firm is authorised and regulated by the Australian Securities and Investments Commission (ASIC). Using a regulated stock broker helps to give traders peace of mind that they are using a brokerage firm which is subject to strict rules and regulations put in place to help protect investors.
It is worth mentioning that there are some non-Australian stock brokers that still solicit clients located within Australia. There are also Australian stock brokers who offer online stock trading services to clients located in some countries outside of the Australia. In this instance, it would be a considered a sensible idea to ensure that the broker in question has the relevant regulation within the jurisdiction that they operate from.
Australian Securities and Investments Commission (ASIC)
The Australian Securities and Investments Commission is an independent Australian government body that acts as Australia’s corporate regulator. Established in 1998, ASIC’s role is to enforce and regulate company and financial services laws to protect Australian consumers, investors and creditors. ASIC reports to the treasurer and administers legislation for the Insurance Act of 1984, the Corporations Act of 2001, and the National Consumer Credit Protection Act of 2009.
Verifying the regulation of stock brokers in Australia
If a stock broker claims to be licensed by ASIC to operate in Australia, they should have a registration number to evidence this. This registration number will usually be located near the footer of the brokers official website. It would be a sensible idea to check that the brokers registration is valid and up to date on the official ASIC website. There are unfortunately scam brokers to be wary of. These scam brokers have been known to fake regulation with some even going as far to clone another brokers website. When you are checking a broker’s registration number, you should verify that the details of the brokerage firm including their website and contact details are provided and if they have any cases brought against them.