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Last updated: 14 April 2021
Execution only share dealing is a type of stock trading that lets you buy and sell shares without getting advice on which shares to buy or sell.
This is done through an execution only broker, who executes the trades that you decide to make without giving you any advice. This helps cut the cost of share dealing by avoiding the fees that come with advisory brokers.
You need to open a share dealing account that offers an execution only option, then you can add money to it and start buying and selling shares.
If you are confident in your ability to buy and sell shares, then an execution only account could save you money.
An execution only share dealing account lets you buy and sell shares without getting any advice first, meaning you can avoid paying any advisory or management fees.
There are several benefits to execution only share dealing:
Access to information and charts in real time
Buy or sell shares faster
Lower trade charges
No advisory costs
There are three main charges to look out for when choosing an execution only share dealing account:
Charge per trade: This is what you pay for each deal you make, whether you are buying or selling shares, e.g. £8 per trade.
Platform fees: This is what some brokers charge for using their platform, which can be taken monthly or annually, e.g. £50 per year.
Transfer fees: This is what some brokers charge when you transfer money out of your account, e.g. £25 per transfer.
Some share dealing companies offer a frequent trader rate, which reduces how much you pay for each deal you make. To qualify for this rate, you need to make more than a set amount of deals in the previous month.
The cost of each type of charge varies depending on the share dealing company you choose, so compare as many as possible to get the cheapest deal.
There are two more types of share dealing broker you could choose from:
Advisory: You get advice on which shares to buy and sell, but it is still your decision
Discretionary: You give authority to your broker to buy and sell shares on your behalf
If your shares are held in an ISA, you will not need to pay tax on your profit or purchases. If they are in a different type of account, you may need to pay capital gains tax and stamp duty.
The amount of capital gains tax you pay when you sell your shares will depend on your income tax bracket and how much money you have made from the sale.
You can find out more about paying tax on share dealing profits here.
No, you will need to choose an advisory or discretionary broker for advice on which shares to buy and sell.
No, only companies that are listed on stock exchanges, like the London Stock Exchange (LSE) or the Alternative Investment Market (AIM).
Many people think you need a lot of money to start stock trading, but that's not necessarily true.
You can start with just a few hundred pounds, and increase how much you invest gradually as you get a better sense of the market and also have more money to invest.
If you plan to make several trades each month a frequent trader account could reduce your cost per trade. Check the terms with each company.
Yes, but only if the company offers one. You still need to open an account online and add money before you can make any trades on the app.
We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.
You do not pay any extra and the deal you get is not affected.