Online brokers in comparison – adviser around trading and share depot
Who wants to trade with securities, needs a depot. In the past, branch banks were primarily responsible for this. With the time of the Internet, however, the first direct banks as well as pure brokers came on the market, with which you can conduct your trading transactions on the Internet. But what is important in an online broker comparison?
Online broker calculator for December 2022
Legal notice: The free comparison does not provide a complete overview of the market and is financed by commissions that we receive on product transactions. The main ranking factor is the overall result, which is calculated based on the filter settings and the respective product conditions. The listing starts with the highest returns and ends with the highest costs. In the case of products with equal returns/costs, the closing ratio is also taken into account. D. h. Products that are chosen more often in relation to the calls here are ranked higher. Unfortunately, we cannot check the authenticity of the ratings, which we sometimes obtain externally.
Order volume: 1000 € / orders per year: 12 orders
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What is an online broker?
To understand what an online broker is, the explanation of a broker is important. A broker is an intermediary between the stock exchange and the investor. So if you want to buy securities, you can submit your orders to the broker and he will execute these trades for you on the stock exchange.
For the brokerage work the broker charges a fee – the order fee (or also order costs). At the same time the broker receives a commission from the respective trading center for the mediation. Additional broker fees are incurred, for example, for the safekeeping of the purchased securities or for additional advice.
In contrast to a normal broker the trades run with an online broker the trades all online. You can invest in stocks and ETFs from anywhere or inquire about your securities account in real time.
Why should you choose an online broker??
If you already have a securities account and handle it classically via your house bank, you certainly know the high costs that come with a securities account.
The costs of an online broker, however, are usually much lower. While you usually pay a custody account management fee and additional order costs of more than 10 euros per order for a securities account at a branch bank, the costs at an online broker are far lower. However it depends here also on the kind of on-line broker.
In addition, specialized online brokers are much more clearly structured than is the case with most branch banks, since brokerage is the main task of the online broker.
Online broker comparison: What is important in an online broker?
Meanwhile there are very many online brokers. New providers are added every year. This has many advantages for you as an investor, as the competition ensures an increasingly better overall package among the providers. However, the large number of brokers also makes it difficult to choose the right provider. What you should look for in an online broker, we explain in this section.
Fees
The most important aspect of an online broker is the fee structure. To see through the fees of an on-line broker, is not at all simple thereby. This also makes it all the more difficult to compare individual providers with each other in an online broker comparison. The following fees are the main ones charged by an online broker:
- Order costs
- Custody fee
- Costs for additional orders such as duplicates
First and foremost, the order fee is important. While this can cost well over 10 euros at a deposit account of your branch bank, at most online brokers you will pay an amount between 5 and 10. Incidentally, other costs come your way through the trading desk that don't come directly from the online broker.
Also important is the notion of a "front-end load" – this occurs primarily in relation to ETF savings plans. The best online brokers today charge a fee of less than 1 percent for executing an ETF savings plan. Many ETFs you can nowadays with online brokers even free of charge besparen.
In addition, online brokers sometimes charge a custody fee. The fee is for the broker to keep your securities safe and secure. How high the custody fees are, is very different: monthly or quarterly settlements are common. With some online brokers, the custody fee depends on the value of your securities. However, the best online brokers do not charge such a fee.
Trading offer
You can not trade the same securities on every exchange. Since an online broker acts as an intermediary, the broker should support as many trading venues as possible. Make sure that there are enough German trading places (especially Xetra) and foreign trading places available.
In addition, nowadays there are many ways to participate in the performance of shares, commodities or even cryptocurrencies. This can be done using ETPs (exchange traded products), which track the value of an underlying product.
In order to build a diversified portfolio through a single provider, an online broker with many different asset classes on offer is recommended.
Security
Make sure that online brokers have at least one registered office in the EU. For regulatory reasons, we recommend an online broker from Germany. Because then your deposits are protected. Your deposits are kept in a settlement account, which is not managed directly by the broker.
German online brokers namely work with licensed banks that provide the clearing account. Thus, the Deposit Protection Fund covers your euro balance up to 100.000 Euro at the broker, if it should not be invested.
Usability
If you want to buy stocks, ETFs and other securities, it should be as easy as possible to do so. In addition to a clear user interface for the desktop version, we also consider a customer-friendly app to be particularly important.
The best online brokers also allow you to provide detailed trading statistics so you can keep track of your activities.
Part of the ease of use is that a broker will pay the capital gains tax for you so you don't have to deal with it again on your tax return down the road. You can be on the safe side if you choose a broker based in Germany, as they will pay the final withholding tax for you. With an online broker, you can submit an exemption request just like you would with your bank.
Support
The reason why mainly conservative investors choose a branch bank is customer service. Having a dedicated bank relationship manager makes many investors feel more secure about their own money.
This makes the support of an online broker all the more important. Younger brokers in particular rely on extensive FAQ areas for support, in which users can clarify the most important questions.
However, the best online brokers still offer live support via live chat or phone. A few online brokers even provide you with a personal customer advisor starting from a certain trading volume. However, this is so far rather the exception.
Additional functions
Nowadays, online brokers offer other functions besides securities trading. Learning content for entering the world of stocks and ETFs is also becoming more and more standard. Thus, beginners find their way faster on the respective platforms.
The best online brokers also allow you to transfer your current securities account. This is not yet possible with every online broker, as the securities account transfer is associated with costs that the broker may not pass on to its customers.
An additional function that more and more online brokers offer is the so-called securities loan. Even though this is risky borrowing, a securities loan is a real alternative to the more expensive overdraft facility.
The new generation of online brokers: What are neobrokers?
In the search for the best online brokers you will increasingly come across the term neobroker. The term Neobroker is composed of the words "Neo" (new) and "Broker" and means something like "new broker". Ultimately, a neobroker is an online broker. An online broker, on the other hand, is not always a neobroker.
Advantages of a Neobroker
As far as the advantages of neobrokers are concerned, they make themselves felt mainly through two components:
- Low fees and
- a user-friendly interface (mostly via app)
Neobrokers target especially young investors without trading experience. Because often securities trading seems very complicated. The costs are also a reason why many savers do not have a securities account until today.
Neobroker waive a fixed custody account fee. In contrast to classic online brokers, the order costs amount to significantly less than 5 euros. order fees of 1 euro and even free trades are becoming more and more the rule.
Most Neobroker do without complicated additional functions and trade offers such as security credits or CFDs, so that the customers do not feel overwhelmed on the commercial platform.
A special feature is nevertheless that many neobrokers additionally offer cryptocurrencies without resorting to certificates. On the other hand, this is not possible with most direct banks and classic online brokers.
Disadvantages of a neobroker
One of the disadvantages of a neobroker is the significantly smaller selection of securities. While investors who are gaining their first experience in trading stocks should be satisfied with the products offered, the situation is different for advanced investors.
Because while established online brokers offer trading on many different trading venues, neobrokers enter into cooperations with a few trading venues in order to be able to trade stocks as cheaply as possible. This comes at the expense of choice.
The disadvantages of neo-brokers are mainly noticeable in the support. Even if customer complaints occur even with the best providers, the of Neobrokern is often not available by telephone or live chat. Thus, in order to be able to ensure low costs, neobrokers rely on many self-service functions. In case of difficulties, customers then have a hard time finding the help they need. However, the support at Neobrokern has improved significantly in recent years.
What types of online brokers are still available?
The term broker is very general. Nowadays, special brokers for different purposes have emerged, which we can all call online brokers as far as they offer their services just online.
Well-known examples are CFD brokers, social brokers or crypto brokers. A CFD broker mainly offers leveraged derivative products, while with a social broker you can discuss with other users of the platform via a newsfeed like on a social network. Crypto brokers specialize in trading cryptocurrencies.
The best online brokers combine the features of these types of brokers without the cost to you going through the roof. However, you won't find a comparable number of shares at a CFD broker that also offers real shares. Similarly, a neobroker with cryptocurrencies does not offer the features of a specialized crypto broker.