Last updated: November 1st, 2024
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With the Australian economy buffeted by inflationary headwinds and rising interest rates, few of us have mountains of investable cash left over at the end of each month.
But the 125% surge by the Magnificent Seven stocks (Meta, Microsoft, Alphabet, Amazon, Apple, Tesla and Nvidia) in the last 12 months demonstrates that even modest sums, invested well, can deliver meaningful returns during economic uncertainty.
Remember that investing small amounts can eat away disproportional amounts of capital through flagfall brokerage fees.
By the time I factor in the rampant CPI and the opportunity cost of my personal time, my shares must appreciate by at least 10% before I break even.
I’ve picked the best discount investing apps in Australia to help you navigate this minefield.
1. Webull.
Best cheap stock broker in Australia.
Webull became available in Australia just over one year ago after becoming one of the most popular cheap stock brokers in the United States.
Let’s see what the fuss is all about.
Pros.
Unlike Interactive Brokers (which I’ll discuss in a moment), Webull gives you access to a tightly focused set of assets.
US options, Hong Kong stocks and Chinese A-shares are also available.
Apart from reducing fees, this approach eliminates distractions. You don’t feel the pull to invest in high-risk asset classes (looking at you, crypto and CFDs) and instead focus on building medium to long-term equity portfolios.
Most people will pay just $4.9 per side to trade on the ASX.
Webull’s official rate is 0.0003 x trade value with a $4.9 minimum, meaning trades above about $16300 will attract a slightly higher fee (e.g., a $30,000 buy order will cost $9).
Buy orders of US stocks are also very competitive, although they involve more complex arithmetic.
In a nutshell, you’ll pay about the same rate, but in US Dollars. If you want to get geeky, the rate is 0.00025 x trade volume on buy orders.
Because Webull is keen to earn your business, they’re waiving commissions on the first 20 trades. This is excellent, as it allows you to create your initial portfolio without chipping away at your capital.
Expert Tip.
Webull doesn’t insist on a minimum deposit amount. You could buy $20 worth of shares if you want to, but remember that ASX trades attract a $4.9 brokerage fee. In this example, you’d be paying almost 25% in fees (and the same again when selling).
Fractional shares are available, which is handy when buying large-cap stocks (did you know that one Class A share of Berkshire Hathaway is worth about US$686,000 as of November 2024?)
The app looks and feels like it deserves to be the centre of your trading experience rather than an afterthought. It gives you access to a large set of technical analysis tools and real-time market data.
Cons.
Webull’s strict focus on Australian and international stocks is also its weakness. Interactive Brokers is still your best bet if you plan to find opportunities in commodities and bonds.
Yes, you get access to some emerging Asian markets and US options, but it’s not the same as being able to trade stocks, forex, cryptocurrencies, options, bonds, futures and funds in 150 markets from a single, integrated account.
Trading CFDs on Webull isn’t possible, either. If you plan to use leverage and trade derivatives, you’ll need a “big boy” CFD trading platform like Pepperstone or Vantage.
Expert Tip.
Margin lending is available, but the 9.6% interest rate isn’t cheap. If you plan to buy shares with borrowed funds, shop around – you’ll find brokerages that offer sub-6% interest rates.
Don’t forget that you’ll need to convert your AUD into USD when purchasing S&P500 shares and EFTs, and this will attract a market-up spread of about 50 basis points. It’s not terrible, but it translates to about US$5 for every AU$1,000 you transfer.
Webull’s educational materials are quite basic, but let me reiterate – don’t expect your broker to teach you how to trade.
Last but not least – Webull’s mobile-only interface may irritate older folks and people who want the option of a desktop trading experience.
Important!
A web interface is apparently in the works, but the company remains tight-lipped about its roll-out date.
Overall.
Webull is an excellent cheap stock broker. Use it to build a portfolio focused on Australian and US equities plus US options.
Paying $4.9 per side is great, especially when Webull offers CHESS sponsorship on your ASX shares.
I wish Webull offered access to European and UK financial markets, bonds and mutual funds. And no, it doesn’t offer copy trading.
Important!
But let’s remember that this is a no-frills, cheap stock broker. If you want the kitchen sink, go with Interactive Brokers instead.
✔ Cheap fees on ASX, US, HK and Chinese stocks
✔ First 20 trades for free makes it even cheaper
✔ CHESS sponsorship on ASX shares
✘ No copy trading features
✘ No CFD trading, forex, crypto or commodities
| How The Webull Stacks Up | Score |
|---|---|
| Market Access | 4.5 |
| Fees | 5.0 |
| Ease Of Use | 5.0 |
| Customer Service | 4.5 |
| Research & Analysis | 4.0 |
| OVERALL | 4.6 |
2. Selfwealth.
Cheapest stock broker for investing large sums.
Selfwealth is a homegrown Australian-owned and operated low-cost stock brokerage founded in 2012.
It quickly gained recognition in investing circles for its access to a good range of Australian and international share markets, cheap pricing and a refreshingly simple fee structure.
Pros.
I like simplicity, and Selfwealth delivers it in spades.
Instead of confusing you with volume-based fee tiers and surprise pass-through fees, the stock brokerage offers simple, flat, cheap pricing:
| Australian Stocks | AU$9.5 per trade |
| US Stocks | US$9.5 per trade |
Apart from being ridiculously simple, this fee structure makes the broker appealing to investors looking to deposit large sums.
Whereas Webull’s calculus of 0.0003 x trade volume works better on deposits below $32,000, Selfwealth becomes cheaper if you plan to deposit more.
Like Webull, Selfwealth lets you trade stocks and exchange-traded funds (ETFs) from the Australian Stock Exchange and the New York Stock Exchange, NASDAQ and HKEX.
A good set of trading tools is already included, but you can pay $29/month to access a more powerful market insight toolkit from Refinitiv, a global financial market data provider.
While it’s nowhere near as sophisticated as the copy trading capabilities of the (more expensive) eToro trading platform, Refinitiv lets you follow portfolios of expert traders and sanity-check your decisions against theirs.
Important!
You also get 90 days of free access to Selfwealth Premium, another twist on copy trading that lets you imitate the strategies of top traders.
Rather than explicitly mirroring the portfolios of experts, the platform recommends trades that will bring your portfolio closer to those of top performers.
Cons.
Selfwealth does have one (somewhat hidden) fee – a 60 basis pointy spread that you’ll need to cough up when buying and selling US stocks.
This is competitive, but probably has a markup of about 30% built into it. It’s not a market rate that the platform pays to its bank.
Refinitiv’s $29 monthly fee is also a sticking point for me. Selfwealth’s research functionality is definitely limited without it, and the company used to charge (a very reasonable) $9 for the service.
But at $29/month? That’s $360 per year eating into my capital.
Apart from those quibbles, I have no complaints apart from the fact that all the usual limitations of cheap trading platforms apply. You get:
- Access to a limited range of markets and assets.
- No access to leverage.
- Some flabby copy trading features.
Overall.
Selfwealth is one of the original cheap brokerages that took off in Australia, and is still one of the best.
Like Webull, it’s an app best suited for investors rather than traders.
Rather, it’s a platform for buy-and-hold investors looking to build medium to long-term equity portfolios.
Selfwealth’s simple brokerage fee structure is a breath of fresh air, while its mobile trading app is friendly, easy to use and intuitive.
Important!
Webull’s fees are still cheaper – until you invest significant amounts of money. Moreover, Webull waives all fees for your first 20 trades. And it’s CHESS-sponsored.
✔ Simple flat fee structure
✔ Competitive AU/US$9.5 commissions
✔ Basic social trading features
✘ The $29/month premium tooklit is too expensive
✘ Limited range of assets and no CFD trading
| How The Selfwealth Stacks Up | Score |
|---|---|
| Market Access | 4.0 |
| Fees | 3.5 |
| Ease Of Use | 5.0 |
| Customer Service | 4.5 |
| Research & Analysis | 4.5 |
| OVERALL | 4.3 |
3. Interactive Brokers.
Most comprehensive discount broker in Australia.
Interactive Brokers is one of the most established discount stock brokers in the world.
Regulated in Australia by ASIC and known for its huge market access and low commissions, Interactive Brokers is a comprehensive multi-asset brokerage that gives you access to over 150 markets from a single trading account.
Pros.
Interactive Brokers is the Swiss Army knife of brokerages.
The platform gives you access to a mind-boggling range of assets, including 17,500 stocks, 46,000 mutual funds, hundreds of ETFs, 24 currencies and over 100 trading pairs.
This abundance of options can become a distraction, but knowing that your broker sells everything you might ever want is also a relief.
Important!
If you’ve ever discovered that you must open and maintain a separate trading account to buy a non-mainstream ETF, you’ll know exactly what I mean.
The Swiss Army knife analogy continues with Interactive Brokers’ comprehensive range of fundamental analysis reports.
You get Morningstar ratings, technical research tools, market commentaries, economic calendars and calculators.
Comprehensive fee summaries, trade logs and searchable portfolio performance reports give you a bird’s eye view of your trading strategy and provide opportunities to course-correct.
But let’s talk about the most important feature – the discount broker’s rock-bottom pricing.
Important!
Zero monthly inactivity fees and low commissions make Interactive Brokers great for defensive buy-and-hold investors seeking to build diversified portfolios.
You get a choice of fixed and tiered pricing.
Mortals who buy $500-$10,000 worth of shares will pay 0.00088 x trade volume with a $6 minimum.
In practical terms, it means all trades up to about $7,000 will cost $6 per side. Beyond that, the volume calculation takes over:
- A $20,000 trade will cost $17.60
- A $50,000 trade will cost $44.00
You’ll get a 30% discount on these rates if your monthly trading volume exceeds $3m.
This fee structure makes Interactive Brokers more than twice as expensive as Webull. But let me emphasise that the real price difference amounts to just a few dollars here and there.
Important!
Unless you open and close your positions multiple times each month, it’s not a difference you will care a lot about.
Cons.
Let’s start with the worst news – Interactive Brokers’ user interface. It’s not great.
The company has done a lot to improve its usability recently, but it still looks like it belongs firmly in 2005.
While Webull and Selfwealth have clean, modern, easy-to-use interfaces that get out of your way, Interactive Brokers has a decidedly complicated, clunky vibe.
To be fair, the brokerage offers four trading platforms — two for beginners (IBKR Desktop and IBKR Global Trader) and two for professional traders (TWS and IBKR Mobile Trader).
The former two are definitely more user-friendly.
Remember how I quoted the relatively cheap 0.008% brokerage fee earlier?
Well, it applies to stocks only. Each asset class on Interactive Brokers has a separate fee structure. You’ll need to become familiar with different rates for options, forex, futures and bonds.
- Next, you’ll realise that these fees are split into a geo-location-specific sub-category. For example, indices in North America have a different price to indices in the APAC region.
- Moreover, purchases of assets in APAC and Euro regions are more likely to trigger volume-based fees while purchases in US, Canada and Mexico will probably be done on a per-share basis.
Expert Tip.
I’m allergic to complexity. If you are too, Interactive Brokers may not be for you.
Overall.
Interactive Brokers is the most comprehensive low-cost brokerage in the world, and in Australia.
Unlike others on this list, it’s a true multi-asset trading platform, catering to beginner, intermediate and advanced investors seeking to build diversified multi-asset portfolios.
It’s not the cheapest brokerage on this list – but is the most powerful.
Its proprietary Trader Workstation (TWS) is an institutional-grade downloadable trading platform with access to deep research and sophisticated fundamental and technical trading tools.
Meanwhile, IBKR Desktop is a new addition aimed at retail investors who want less complexity.
Despite attempts to strip out complexity, IB remains a complicated, clunky beast. Its cheap trading fees come at a price – your time.
✔ Unparalleled range of tradeable assets
✔ Low commissions that get cheaper with huge volumes
✔ Unbeatable range of trading tools for sophisticated investors
✘ Complicated and intimidating
✘ Clunky user interfaces
| How Interactive Brokers Stacks Up | Score |
|---|---|
| Market Access | 5.0 |
| Fees | 4.5 |
| Ease Of Use | 3.0 |
| Customer Service | 4.0 |
| Research & Analysis | 5.0 |
| OVERALL | 4.3 |
4. Raiz.
Cheap Australian investing platform.
Micro-investing apps like Raiz allow you to earn interest on spare change that you would otherwise spend on alcohol and [insert your vice here].
Mine is 4WD spare parts.
You get a shortlist of pre-packaged portfolios with exposure to different sectors of the economy or particular asset classes.
Too good to be true?
Pros.
As a managed investment fund, Raiz gives you access to the share market with a minimum contribution of $5.
The pre-packaged portfolios mainly focus on ETFs that consist of Australian, Asian, US, European and UK big-cap stocks and Australian government bonds.
Safer portfolios will track more bonds and cash assets, while more risky ones will allocate more of your funds to international stocks.
Risk-seekers can choose even more aggressive portfolios that have exposure to crypto, while control freaks can tweak any portfolio to their needs.
What are the fees like?
Important!
The good news is that you don’t pay any sneaky deposit or withdrawal fees, and the fees you do pay are quite cheap. I’ll discuss the bad news in the Cons section below.
You can deposit money into Raiz using a predictable method (recurring or ad-hoc transfers using a bank account), but there’s a whimsical twist.
Cons.
Raiz makes money by charging you a monthly management fee. You’ll pay $4.50/month for most scenarios or $5.50/month if you customise your portfolio.
Expert Tip.
If you don’t save regularly to increase your balance, this is a terrible deal. If I maintain $100, for example, I’ll still pay $4.50 per month, losing half of my money within a year.
Once your balance exceeds $20,000, the fee switches to a percent-based commission of 0.275% per year.
A $30,000 fund will cost you $82.50 per year, then.
While Raiz is transparent about its brokerage fees, remember that ETFs are likely to charge their own fees, which will eat into your profits even more.
Adjusted for this management cost, the total fee on a $30,000 investment is now $97.5. It’s not cheap, but also not the end of the world.
Whether this works for you depends on your financial habits.
Overall.
Raiz is a cheap investing platform (and the best micro-investing platform in Australia) because it doesn’t charge per-trade commissions while encouraging you to save your spare cash.
That said, Raiz does not fully replace all features of a bona fide stock brokerage.
I view it as a gamified savings tool. If you regularly contribute a few dollars over a few years, you may discover that you have enough funds for a “free” holiday.
Expert Tip.
Withdrawal of funds on Raiz takes 5 business days. This is painfully slow, but consider it a benefit – it will prevent you from withdrawing funds to make impulsive purchases.
✔ Invest your spare cash instead of blowing it
✔ Cheap-ish fees
✔ Round-up feature is innocent but effective
✘ Sub $1,000 balances likely to go backwards due to fees
✘ Limited control
| How The Raiz Stacks Up | Score |
|---|---|
| Market Access | 2.0 |
| Fees | 4.0 |
| Ease Of Use | 5.0 |
| Customer Service | 4.5 |
| Research & Analysis | 2.0 |
| OVERALL | 3.5 |
5. moomoo.
Good cheap stock broker for trading US stocks.
Does Australia need another cheap brokerage? Apparently. Like Webull, moomoo offers US and Australian stocks and ETFs. HK stocks are also on the menu.
Unlike Webull, moomoo doesn’t offer US options or Chinese A-shares.
Expert Tip.
Fees on ASX shares are excellent, at $3 per trade or 0.03% of trade value, whichever is greater. A $10,000 buy order will $3 while a $30,000 order will set you back a very reasonable $9.
But there is a catch—your shares won’t be protected with CHESS sponsorship. Yep, there’s always a catch.
But if you want to stick with US shares only, moomoo is your best friend. A US$0.99 fee per trade is about as cheap as it gets.
You will pay a small markup on their currency conversion fee, but that’s standard across all brokers offering US shares.
✔ Yet another cheap broker
✔ Cheapest available commissions on US shares
✘ Narrow range of assets
6. Spaceship Voyager.
Good (but not very cheap) low-cost investing platform.
Like most micro-investing apps, Spaceship allows you to invest lump sums or create recurring deposits.
Rather than giving you access to global ETFs, Spaceship offers premade stock portfolios built by Spaceship analysts.
The fee structure is OK. First, you pay a cheap monthly fee of $2. Second, you pay an additional management charge that ranges between 0.15% and 0.5% per annum, depending on your portfolio.
Important!
Even though Spaceship doesn’t charge any deposit or withdrawal fees, the management fees are not cheap. They will chew up $174 in fees annually on a $30,000 balance. I think Raiz offers a much cheaper rate.
✔ Yet another micro-investing app
✔ Invest directly in big-cap stocks rather than ETFs
✘ Raiz offers cheaper fees
7. CMC Markets.
Good multi-asset investment platform.
CMC Markets is not just an investing app.
It’s a powerhouse trading platform that offers a sophisticated suite of trading tools and access to shares, CFDs, forex, indices, treasuries, cryptocurrencies and commodities.
That’s over 12,000 tradeable instruments.
CMC’s proprietary CMC Markets Invest trading platform strikes a good balance of sophistication and ease of use.
Meanwhile, the mobile app, appropriately named CMC Markets Invest Mobile, is merely OK. It won’t offend or scare you, but I’ve seen better.
✔ True multi-asset platform with access to a huge range of markets
✔ Trade shares and CFDs
✔ Suitable for beginners and advanced investors
✘ Unnecessarily complex for beginners
Frequently Asked Questions About Using Cheap Stock Trading Brokers.
I have been bombarded with questions since starting to cover the world of online trading. Here are my answers to the most common ones.
What’s The Best Way To Build A Diversified Investment Portfolio?
I’m not allowed to offer investing advice, but I’ll email you the names of educators I trust if you comment below.
Important!
Don’t listen to trading gurus on YouTube. They become gurus precisely because they fail to make money.
What would you do if you were making $10,000 per month in financial markets?
- Become a YouTuber, showing others how to do it, hoping to make ad revenue and sell a course.
- Double down on trading, hire staff to build a trading desk and scale your operation.
I hope that answers your question 🙂
Which Trading Platforms Have The Cheapest Brokerage Fees?
This is a complex question with no easy answers.
Yes, some platforms are cheaper than others. But one of the best ways to reduce fees is to improve your skillset (or change your mindset around investing).
For example, many people worry about withdrawal fees – because most brokers will give you a $5-$10 clip when moving funds back into your bank account.
If you’re paying withdrawal fees often, you’re likely thinking too short-term and taking chips off the table too often.
You are the problem in this instance – not the fee.
| Stock Broker | Brokerage Fee | Tradeable Assets | Signup Bonus? |
|---|---|---|---|
| Webull | 0.0003 x trade value with a $4.9 minimum to trade on the ASX (see text above for US markets) | Stocks and ETFs on APAC and US exchanges, US options | $0 Brokerage For First 20 Trades |
| Interactive Brokers | 0.00088 x trade volume with a $6 minimum for Australian equities (see IB website for US markets and other asset classes) | Stocks and ETFs on Euro, US, UK, APAC exchanges, CFDs, forex, options, crypto, commodities, bonds | None |
| Raiz | $4.5 or $5.5/month, then 0.275% on balances above $20,000 | Stocks and ETFs | None |
| Selfwealth | $9.5 flat fee to trade on the ASX + minimal currency conversion fee (see text above) | Stocks and ETFs on APAC, US and HK exchanges | None |
What Are The Risks Of Using Cheap Mobile Trading Apps?
I don’t trade via mobile investing apps 100% of the time, as I’m more likely to make emotion-driven, FOMO-based decisions.
Yes, their convenience allows me to perform fundamental research (e.g., what’s their P/E ratio?) while validating my thoughts using technical analysis tools.
Do I Need An Investing App To Trade Stocks?
No. You can trade using a web-based desktop app. Most brokerages in Australia offer both.
Did you Know?
Advanced investors spend most of their days trading via Meta Trader 4 and Meta Trader 5 – very dated but powerful (only available via download to your desktop) trading platforms.
How To Choose The Cheapest Brokerage For Your Needs?
Cheaper isn’t always better. Don’t fall for the glitzy marketing. The brutal truth is that most cheap online brokers are commodities without many differentiators.
But they differ in small and important ways that can help you get ahead in the financial markets.
1. Market Access.
What do you plan to invest in? Remember that volatility and opportunity are two sides of the same coin. You need volatility to make money.
Professional investors typically build diversified portfolios using multiple long and short positions across several classes.
They open “safer” positions as a hedge against riskier trades.
Important!
Multi-asset platforms like Interactive Brokers enable you to create sophisticated, diversified portfolios by giving you access to a huge range of markets. But this flexibility has a price – higher brokerage fees.
Meanwhile, simple, low-cost apps like Webull charge very low fees but offer exposure mainly to big-cap shares and ETFs in North American and APAc regions.
Net result?
Fewer opportunities to hedge.
2. Brokerage Fees.
Trading platforms make money through fees. They’ll get you in one way or another. The key is to choose a platform that suits your investing style.
I’ve already discussed how to reduce your trading fees above, but let me expand:
Important!
Zero-brokerage platforms usually mark up their currency conversion fees. They also charge above-market spreads on leveraged trades, hoping you place a few of those.
3. Ease Of Use.
The more clunky an app is, the less likely you are to use it. Test drive it using a demo account to ensure it’s intuitive, easy to navigate and bug-free.
Final Word On Choosing The Cheapest Stock Broker In Australia.
Cheap Australian brokerages offer plenty of opportunities to invest your spare change. Remember that, as with all things in life, perfect choices don’t exist – only trade-offs do.
Many guys spend months researching the best low-cost stock brokers, trying to find one with zero brokerage fees, a huge range of trading assets and a perfectly designed user interface.
Spend your time wisely. Focus on learning the basics of investing and building good money habits instead. Read the educational resources share trading apps offer, but don’t stop there.
They are not incentivised to help you trade well – because they make more money when you trade poorly.
Steven
Please drop me those educators.