Low Cost Share Dealing, Cheapest, Internet, Online, UK

UK share dealing has exploded amongst retail customers ever since online share dealing platforms became prevelant.

When giving advice to those new to equity investing, we always recommend them to start with share dealing in the UK markets first. There are a number of reasons for this, which include the lower cost of UK share dealing versus trading in and out of positions in shares listed on exchanges in foreign countries, and the natural familiarity they will have with the companies listed on the UK exchange.

UK share dealing is cheaper for UK residents than trading in other foreign exchanges for several reasons.

First is the complexity in executing cross-border transactions which can often involve a number of brokers and online share dealing platforms. Secondly, especially the case of emerging economy stock exchanges, there is generally high liquidity in the shares listed on the LSE. This high liquidity results in lower bid-ask spreads or commission costs associated with the UK share dealing.

To develop the second point, this is something the idolised investor Warren Buffet hits on all the time. One of his key investment mantras is to invest in stocks he understands and those where the price does not imply he is paying over for too much expected earnings growth. For UK investors it is important to realise that the companies you best understand and are familiar with are those you have grown up interacting with. These are the companies you should first consider when deciding to build a portfolio of UK shares.