Shares can be traded conveniently via smartphone – this now works with many providers. But no one is like the other. In order to avoid running costs, a broker without custody fees is recommended. We introduce you to the best apps for beginners.
Inflation that is seven percent and savings account interest that is close to zero percent: Even those who weren’t among the model students in math class will notice: If everything gets more expensive and my savings don’t grow with it, I can afford less and less of it. If you leave money in your savings account, you are currently literally burning it. No wonder more and more people are turning to alternatives such as stocks and ETFs, even if they involve a higher risk. A popular entry into the stock market world are broker apps for iOS & Android. Once verified with your ID card, shares, funds & ETFs can be traded.
We present three providers without custody fees in detail. The applications are each available free of charge for Android smartphones and iPhones.
The new generation of trading: broker chat instead of broker appointment TradeRepublic, Scalable Capital and eToro are three well-known stock brokers
Providers promise long trading hours, which are usually uninterrupted. A good app and strong infrastructure are essential. When it comes to choosing a broker, providers without custody fees are attractive in terms of price, but sometimes come with a few drawbacks. Even the largest providers lag behind at peak times. ID verification, depot opening and payment usually takes 2-3 days. Additional costs for a share purchase sometimes amount to less than one euro. However, short-term gains in the stock market are taxed at a rate of 25%.
In times of high volatility it is quite possible that trading will be halted. Be it due to technical problems or liquidity problems. In the USA, RobinHood was the “big player” so far, in Germany the concept of stock trading via smartphone was made known by TradeRepublic.
In the meantime, other German providers such as Scalable Capital have also joined. Foreign apps play along too, promising extra fun by copying other members’ purchases and sales. However, this so-called social trading, for example via eToro, is associated with additional risks, just like betting on falling prices, i.e. “shorting”.
TradeRepublic: Berlin startup for modern shareholders
Tesla, Apple and Amazon are “Popular Stocks” on TradeRepublic – they can be traded for one euro per trade. In addition to a clear portfolio, the constantly changing ranking is part of the chic TradeRepublic app, which combines live courses and trading.
Those who open an account are advised that stock trading involves risks. In the case of GameStop, AMC & Co., TradeRepublic promised to provide its customers with additional protection. Trading was suspended, the startup contacted its customers by email and pointed out the “risks for you”. The company later apologized for failing to meet expectations of a “modern, democratic and free broker”.
TradeRepublic became known in Germany for its funny advertising videos and the unrivaled cheap trade. RobinHood is the company’s American model. The app is “very intuitive”. Users can buy and sell stocks in seconds. The price color red or green symbolizes whether the depot has already achieved a price gain today.
Deposits are only possible by bank transfer, new amounts are credited several times a day. Payments are usually on the account after two bank working days. TradeRepublic for Android and TradeRepublic for iOS are available for free download in the stores.
Trade Republic: Open a depot now for free
Scalable Capital: Chic depot with additional features
With a Prime or Prime-Flex membership, Scalable Capital customers can trade as much as they like with a minimum volume of 250 euros per purchase. The flat rate costs 4.99 euros per month, with annual payment the costs per month are 2.99 euros.
But the application also offers free membership with no custody fees. In addition, customers can not only manage their depot via the app, but also via the web via the browser. If desired, the app can be used for two-factor authentication.
In October 2020, Scalable Capital had to notify 32,000 customers that an employee had abused internal access to customer and ID data. 23,000 of the customers had already made payments to the depot. The company now promises that it is “technically ensured” that the incident cannot be repeated.
A deposit is possible in cooperation with the Baader Bank both by deposit and by direct debit. The application is available for free download as Scalable Capital for Android and Scalable Capital for iOS.
Scalable: Open a depot now for free
eToro: Buy stocks with PayPal
Pioneer in copy trading, eToro was founded in Tel Aviv and is based in Cyprus. The company thus benefits from its independence from the Bafin – but it also involves additional risks. In addition, you pay extra for the conversion, it is converted into US dollars.
Users can follow their role models’ profiles on the eToro social stock network and mimic their purchases and sales. As a result, investments are associated with a particularly high risk, since it is difficult to distinguish serious investors from risky speculators.
Deposits are possible via PayPal, credit card, Klarna and many other payment methods. Furthermore, eToro is possible on forex trading and trading with the Bitcoin & Co. courses.
eToro is available as an app for Android & iOS, as well as directly via the browser. Note that eToro only charges no custody fees if you are actively using your account to trade.
eToro: Open a depot now for free