Cheapest Online Brokers in Australia – Best Brokers in 2020

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Best Online Brokers Australia for 2020

The StockBrokers.com best online brokers 2020 review (10th annual) took six months to complete and produced over 30,000 words of research. Here’s how we tested.

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 16 th 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

Best Overall
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 PlatformVisit 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 ProfessionalsOpen 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

Best Research
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.

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  1. 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.
  2. 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.
  3. 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.
  4. 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
NabTrade N/A Yes Yes $19.95 4 Stars
BellDirect N/A No No $15.00 4 Stars
ANZ N/A Yes Yes $24.95 4 Stars
Amscot N/A No Yes $11 3.5 Stars

Explore our other online trading guides:

About the author: Blain Reinkensmeyer As Head of Research at StockBrokers.com, Blain Reinkensmeyer has 18 years of trading experience with over 1,000 trades placed during that time. Referenced as a leading expert on the US online brokerage industry, Blain has been quoted in the Wall Street Journal, The New York Times, Forbes, and the Chicago Tribune, among others.

All pricing data was obtained from a published web site as of 01/20/2020 and is believed to be accurate, but is not guaranteed. For stock trade rates, advertised pricing is for a standard order size of 500 shares of stock priced at $30 per share. For options orders, an options regulatory fee per contract may apply.

Advertiser Disclosure: StockBrokers.com helps investors across the globe by spending over 1,000 hours each year testing and researching online brokers. How do we make money? Our partners compensate us through paid advertising. While partners may pay to provide offers or be featured, e.g. exclusive offers, they cannot pay to alter our recommendations, advice, ratings, or any other content throughout the site. Furthermore, our content and research teams do not participate in any advertising planning nor are they permitted access to advertising campaign data. Here is a list of our partners.

Disclaimer: It is our organization’s primary mission to provide reviews, commentary, and analysis that are unbiased and objective. While StockBrokers.com has all data verified by industry participants, it can vary from time to time. Operating as an online business, this site may be compensated through third party advertisers. Our receipt of such compensation shall not be construed as an endorsement or recommendation by StockBrokers.com, nor shall it bias our reviews, analysis, and opinions. Please see our General Disclaimers for more information.

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Cheapest Online Brokers in Australia

One of the best ways to improve on your trading success is to ensure that your trading costs are as low as possible.

If this is something you are interested in, the information below will be of great use to you. Here, you will not only discover what the top discount brokers Australia are but also get a closer look at what makes them great.

Top Australian Online Brokers With Low Fees

Name Min. Deposit AU License Review
AU$100 ASIC License OPEN ACCOUNT
AU$100 ASIC License OPEN ACCOUNT
AU$50 ASIC License OPEN ACCOUNT

1. FP Markets

FP Markets is an online CFD and forex broker. This is an ASIC regulated brokerage that has been functioning for over a decade, making it one of the better-known brokers in the market. Here is what you need to know about this broker:

Instruments

If you choose to sign up with FP Markets, you have access to around ten thousands instruments. This allows you to be engaged with a wide number of instruments in share trading, CFD trading, and forex trading. Most of these instruments are related to CFD trading, allowing you to select from:

At the same time, you will also gain access to around 50 currency pairs for forex trading. As far as commodities go the top options are:

You even have the option to trade with Bitcoin if you want to.

Accounts and Fees

There are three different kinds of accounts, one for each trading category. For the share trading account, you can opt for the Standard which offers up a 0.11 percent commission fee and $14.95 minimum fee. For the non-leverage CFD account, the commission starts at 0.08 percent and there isn’t a minimum fee.

The three CFD accounts are the Professional, Platinum, and Premier, with minimum opening balances ranging from $1,000 to $50,000. For equity CFD, 0.08 percent for Australia to 2 cents a share when trading US stocks from Australia.

For forex accounts, Standard minimum opening balance is $100 while the ECN RAW account is $1000. There are no commissions for most of the Standard transactions. Instead, the cost is built into the spread. For the RAW accounts (forex and metals) there is a cost of $3.5 per 100,000.

Platforms

You can select from three platforms with this broker – the IRESS, MetaTrader4, and MetaTrader5. This is good news for traders of all capabilities as you should be able to find a suitable platform between these three. Now, of all these platforms, the IRESS does include a charge of $55 a month, including GST.

2. Amscot Stockbroking

Amscot Stockbroking is in the mix as the best stockbroker Australia. This broker provides traders with some of the most competitive prices on the market. Here is a closer look at how this broker functions:

Instruments

What puts Amscot Stockbroking on the map is the fact that it deals with the three major exchanges in Australia. These are the ASX, Chi-X, and Sydney stock exchange. Due to this, traders have all the instruments traded on these exchanges at their disposal. As such, it can offer a higher number of instruments than most other brokers.

Accounts and Online Trading Rates

You can open an account with Amscot for absolutely no cost at all. There are no sign-up costs, monthly fees, or even any ASX royalty fees. Rather, the fees here are associated with the trading plans made available by the broker. Depending on what kind of trader you are, you can select from the ValueRate and TraderRate.

If your trade values tend to be less than $40,000 then your ValueRate is the best option here for you. Here a trade size of $5,001 will incur a brokerage rate of just $9.90. In fact, with this plan, you will find that the prices beat out many of the other brokers, as long as you trade less than $50,000.

For traders whose trade value tends to be greater than $50,000, the TraderRate works well. A trade size of 50,0001 will have a rate of just $33. The rate remains almost as low, even when the trading value increases up to $1,000,000.

Platforms

One of the downsides of this broker is that you are only able to rely on different forms of the IRESS trading platform. As you may be aware, this is one of the few platforms that require a monthly fee. As such, you will be required to pay $77. However, if $220 of brokerage is generated during the month, this fee will be waived.

3. Bell Direct

Bell Direct is actually an award winning broker, ensuring that you are in good hands when you sign up for a share trading account Australia. To find out just what this brokerage has to offer you, keep reading:

Instruments

One of the top reasons to select this cheap broker is the fact that there is so much you can trade with. This includes all ASX listed equities. To add to this there are also:

  • Interest rated securities
  • ETFs
  • Warrants
  • Managed Funds
  • Options
  • IPOs
  • XTBs

As you can see, you really are spoiled for choice. This makes Bell Direct a good solution for more seasoned traders who want to keep costs down.

Bonus Tip: If you are interested in forex trading then one of the cheapest online brokers is Vantage FX Australia.

Trader Fees

One of the main perks with this broker is that the more you trade, the less you actually pay. For instance, your first 10 trades of the month (up to $10,000) cost just $15. The 11 th to the 30 th trades are 13 or 0.08 percent, depending on which is higher. The 31 st trade onwards cost $10 or 0.08 percent, whichever is greater.

Platform

To add to the many benefits of signing up with this broker is the fact that it has arguably the best online trading platform Australia. This broker-approved platform makes it easier for traders to place trades more efficiently and quickly, improving your opportunities. This is aided by the fact that the platform is synced to up-to-date, with live information, ensuring that you have constant knowledge of what is going on.

These are the cheapest online brokers you can find anywhere. Not only are they affordable, these brokers also provide top-notch services and excellent trading opportunities.

Cheapest Online Brokers in Australia – Best Brokers in 2020

Interested in online trading but confused about which broker to open a trading account with? You’re not alone!

The online trading industry is an extremely competitive one and the choice of online brokers in Australia is seemingly endless. CompareCFDbrokers.com.au has one simple purpose in mind; to provide an independent comparison of some the leading online trading brokers in Australia, so traders can find a reputable, trustworthy and regulated broker to trade with.

The comparison table looks at some key features to consider when opening an online trading account;

Best CFD

Brokers

Who are they?

Leverage (Australia)

Regulation

Min. Deposit

Segregated Bank Accounts?

ASX Stock Comm. $

ASX 200 spread

AUD/USD spread

Spread Type

Welcome Bonus?

Trading Platform

Next Steps

Plus500

AU’s fastest-growing and

cheapest CFD broker

City Index

World-Leading CFD

B roker, T ight Spreads

TradeDirect365

Australia’s Best-Value

CFD Broker

What is online trading?

Online trading is the act of buying and selling an asset class such as currencies, futures, commodities, indices, stocks etc. through an online broker’s trading platform.

Once reserved for large financial institutions, online trading exploded in the late 1990’s/ early 2000’s when the internet became mainstream – thus allowing everyday investors’ access to the world’s financial markets. Nowadays, you don’t need to be a large bank or have $1m in the bank to trade; anyone with a computer and decent internet connection can apply for an online trading account.

In order to start trading, an individual would need to open a trading account with an online broker so they can execute their trades. There are many brokers to choose from and some are listed above in the comparison table.

It’s important to note that, while the financial markets are easily accessible these days, they should not be taken lightly and your hard-earned savings can be wiped out very quickly if you do not know what you’re doing or there is volatility in the markets. Please be careful.

What are the benefits of online trading?

You can speculate on both Rising and Falling markets: online trading allows you to bet that a particular market will go up as well as down. As an example, when we buy a stock we typically want it to go up in value so we can make a profit, but with online trading we have the ability to “go short” and sell an asset when we think it will decrease in value. This is one of the major benefits of online trading.

Trade using leverage: as mentioned above, online trading is a leveraged product which means you only need to deposit a small fraction of money in order to open significantly large trades. Leverage can be good and bad for retail traders, more on this in the section below.

24/5 access: online trading lets you trade on markets from all around the globe, at all hours of the day. Most online brokers will offer, at a minimum, the major markets however some brokers will give you access to 30,000+ different trading products!

You do not own the asset: with online trading, you are purely speculating on which direction the price of an asset will move – you do not own the asset (unless you go and buy it direct from an exchange). Therefore, you don’t have to worry about ownership costs etc.

Top 5 considerations when choosing an online broker

There are a number of important factors to consider when choosing which online broker to trade with and some of these have been outlined below. Ultimately, deciding which broker to use is a very personal one and the final decision is up to you.

1. Trading Costs
This is one of the most important considerations as the lower your trading costs, the greater the opportunity there is to make a profit, all other things being equal. Please research and compare the costs involved before opening a trading account with a broker. Please ask your broker about the following, standard trading costs;

  • Spread charges: are spreads fixed or variable? How wide (expensive) are their spreads?
  • Commissions: are there any commission charges when trading with them?
  • Overnight financing charges: what do they charge to keep a trade open overnight?
  • Exchange fees: are there any exchange fees (i.e. ASX data feed fees)?
  • Inactive fees: unfortunately some brokers charge an inactivity fee which is absolutely ludicrous. Please ensure you know if they will do this and avoid brokers that do charge this ridiculous fee.

2. Regulation
Ensure your broker has the appropriate regulation before opening an account with them. In Australia this would be an AFSL (Australia Financial Services Licence) – look on their website for an AFSL number, this will mean they are ASIC-regulated. Do not trade with a broker who is not ASIC-regulated.

Online financial trading with a regulated entity has many obvious advantages; most notably that a broker will be closely monitored by the countries’ governing regulator and they will be required to work within a certain framework, ensuring brokers run a business in accordance with the local laws.

3. Reputation
Research the brokers you are considering opening an account with – what are other traders or industry experts saying about them? Are they a ASX listed company? Do they segregate clients funds? How long have they been in business?

4. Technology: is their trading platform easy to use?
You need to be comfortable with a broker’s software, including their trading platform and App as that’s where you’ll be making your trades from. If you don’t like their technology, go elsewhere. We’d recommend opening a few demo accounts and testing those before taking the plunge with a live trading account.

5. Range of markets
Ensure that the broker you want to trade with has the markets you are hoping to trade! Most brokers will offer the standard markets (FX, Gold, Silver, Oil, Indices etc.) but if you’re hoping to trade a smaller market or new asset then ensure the broker offers this.

How does online trading in Australia work?

Before you can begin trading online, you’ll need to open an account with a broker. Then you’ll need to decide which markets you want to trade. For example, do you want to trade forex or Gold? The Aussie 200, Wall St or the UK100?

TradeDirect365’s CloudTrade CFD Platform

Once you’ve opened your trading account with an online broker, the next step is to fund your account so you can place some trades. Remember, with online trading you’re simply speculating on the price movement of an asset – you do not own the physical asset.

Once your money has been applied to your trading account, you are ready to trade. Please ensure you know the costs involved in opening the trade before you open it. Each broker has different spread and commission structures so do your research before opening your first trade (more on trading costs below).

Another important point to remember with online trading is that you are trading on margin (leverage). This means you only need to deposit a small portion of money to open larger trade sizes. For example, broker X may offer leverage of 200:1 which is a margin rate of 0.5%. If you put $200 into your account, you can potentially trade market positions valued at $40,000 (200 leverage x $200)! Leverage can help boost your profits quickly but it can also decimate your trading account (and life savings) in a heart beat so be careful and know what you’re doing.

The main aim of online trading is to make a profit. If this is not your main aim then you need to reconsider what you’re doing! If you speculate correctly then you should make a profit from online trading. Obviously it’s not always that easy and the truth is around 90% of traders lose money.

How much does it cost to trade via an online broker in Australia?

There are a number of broker costs involved with online trading;

  • Commissions Charge: most brokers will only charge a commission on stock trades. Trades on most other markets, like FX, Commodities, Indices etc. will not incur a commission charge. Check with your broker before opening a trade however.
  • The ‘Spread’ Cost: the spread is the difference between the buy and sell price, and is essentially the cost of opening a trade. For instance, the spread on the ASX 200 is 1pt if the buy & sell price is 6,101 – 6,100. The lower the spread, the lower you are being charged, all other things being equal. TradeDirect365, for instance, have some of the tightest spreads in the industry which means they are charging you less to trade.
  • Overnight Financing Cost : an overnight financing charge is applied if you hold a trade open overnight. It is a small interest charge to cover the cost of holding a trade open overnight.
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