Guiding consumers since 2009

Which online equities trader is the best for you?

By Staff Writer
Through accessibility and easy-to-use interfaces, many investors and traders have switched to online platforms. However, there are a number of different platforms to choose from. With EasyEquties now officially live, and etfSA just recently launched, online traders are spoilt for choice.
 
However, EasyEquities might be up for a challenge when it comes to the 'cheapest online trader platform crown'. If they are concerned they aren't showing it. Almero Oosthuizen, head of marketing at GT247, the company behind EasyEquities, said that they welcome the competition.
 
"Both the SATRIX and etfSA offerings are great offerings and we welcome any competition. We do however offer all the products available in their offerings on the EasyEquities platform. Pre EasyEquities this was one of the most affordable ways to invest," said Oosthuizen.
 
However, when it comes to picking an online trading platform, it is vital knowing that your money is safe and that transactions aren't too expensive. Here's a roundup of a few to consider:
 
EasyEquities
 
EasyEquities allows investors to buy fractions of shares for as little as 13 cents. According to the EasyEquities website: "Fractional ownership allows you to purchase a portion of an equity, instead of being limited to whole-equity quantities."
 
"[It is] easy, affordable, secure equity ownership for everyone. Quite frankly its investing, just made easy!" said Charles Savage, CEO of GT247.
 
This allows savers to invest any amount of money up to just over R33 million. The EasyEquities site will also calculate the amount of commission on the purchase of the shares you buy.
 
"This is designed to broaden access to Share ownership, including people who have never invested before in equities," said Savage.
 
They point out that their brokerage commission of 0.25% is lower than PSG Online, Sanlam iTrade and Standard Bank. They also don't charge a monthly admin fee. However, you do pay for telephonic purchases which cost R50 extra.
 
"R50 telephone charge is necessary as we want to discourage investors from trading over the phone as this requires experienced and expensive resources to manage and resource the service," said Savage.
 
(For more information on EasyEquities, click here.)
 
etfSA

etfSA is the home of Exchange Traded Funds (ETF's) and is an internet based information and transaction website that provides simple and efficient solutions for investors wishing to discover, understand, manage and profit from the world of ETF's, so explains its website.
 
Investors may invest lump sum investments from as little as R1000, or invest with a recurring debit order starting from as little R300 per month.
 
(For more information on etfSA, click here.)
 
Satrix
 
"The first to launch Exchange Traded Funds (ETFs) in South Africa in 2000 with the launch of its flagship Satrix Top 40 ETF (with a market capitalization of nearly R9 billion), Satrix has been a pioneer in the passive investment industry; launching a number of new and innovative index tracking products over the years," explains the Satrix website.
 
(For more information on Satrix, click here.)
 
FNB
 
First National Bank (FNB) has three products when it comes to online trading: the Share Saver, Share Builder and Share Investor. "We try to cater as many people as possible," says Carin Meyer, CEO of FNB Share Investing.
 
Share Saver is an online product where you pay a monthly fee depending on your portfolio size, however, a minimum monthly investment of R300 has to be made. This product does not allow you to pick your own shares, but rather have your money invested for you across the top 100 companies on the JSE.
 
(For more information on Share Saver fees, click here.)
 
With the Share Builder, the number of shares you can buy into is limited, but you can choose which shares you want to invest in and you can buy Krugerrands. "We limit the number of shares so that the clients do not feel overwhelmed by too much information, but still have the freedom to choose which shares they want to invest in," said Meyer.
 
You have to have a minimum account balance of R100, and pay a monthly fee of R19.
 
(For more information on Share Builder fees, click here.)
 
The Share Investor allows you to look at all the shares on the JSE: "This is for those guys who are comfortable," says Meyer. This has a monthly fee of R49, with a minimum account balance of R200.
 
Standard Bank
 
"For a first time investor there are two paths available, when getting started. So we have two different products and they are tailored to different mechanisms of investing," said Humphreys.
Standard Online Share trading, a division of SBG Securities, has different online trading options depending on the needs of the investor. The Automated Share Investment (ASI) platform is a cost effective way for clients to get into the market, and is recommended for first time traders.
 
You can schedule purchases every month, and payment is automatically linked to your bank account. However, you have to be a Standard Bank Internet Banking client in order to use this product.
 
"We have built this product specifically for the client who is looking to make frequent small investments in shares and who embraces the long term nature of investing," said Mark Humphreys, senior business manager for Standard Online Share Trading
 
The first option, explains Humphreys, is the ASI. It is housed within Standard Bank's internet banking platform, and because of that it is only available to Standard Bank clients.
 
"That is the most entry level product. It is designed for making monthly or bi-monthly small investments (in the range of R500 to R5000). To keep things simple all transaction costs (inclusive of brokerage, securities transfer tax (STT), investor protection levy (IPL), STRATE & VAT) are included in the fee of R20 plus 1%" said Humphreys.
 
Humphreys went on to say that there are approximately 100 stocks available on the ASI platform, which are the top 40, most of the ETF's, and some of the upper end mid-cap stocks as well.
 
Once you are a little more experienced, you can migrate to the Standard Online Share Trading platform, which is R60 a month, with access to a wider range of products and features. You do not have to be a Standard Bank client to use this product.
 
However, when it comes to advice, Standard Online Share Trading cannot tell you which stocks to buy, and which to leave, but will provide you with the means to make the decision for yourself.
As part of their client education programme Standard Online Share Trading offers face-to-face courses and webinars (online seminars) for those wanting to know more about trading. There are also and how-to guides available on their website.
 
For more information on Standard Online Share Trading prices and products, click here.
 
For more information on Standard Bank prices and products, click here.
 
Absa
 
Absa has two options. Their online trading platform allows clients to trade shares and ETF's, as well as check their accounts at any given time. The second service is a telephonic one where clients place trades through a simple call and have the ability to monitor their stocks online.
 
Absa does not have a monthly account fee, but they do charge a brokerage rate of 0.4% of the value of securities traded. There is a minimum brokerage charge of R120 per trade according to their website.
 
Absa do not have educational information at the moment but Robert van Eyden, the head of stockbroking at Absa added: "There will be a concerted effort on educating people about the shares."
 
Product prices 
 
  Monthly fee Min. account balance Min. brokerage charge*
FNB      
Share Saver 0.4% per annum pus VAT - 0.10%
Share Builder R 19 R 100 R 50
Share Investor R 49 R 200 for SA citizens, for foreigners it is R500 R 49 for SA citizens, for foreigners it is R75
       
EasyEquities - - R2.50
       
Satrix 0.65% of investment R300 0.10% of investment
       
ETFSA 0.75% of investment R300 0.10% of investment
       
Standard Bank      
ASI   No min. account balance, but R25 (including VAT) inactivity fee if you don't invest in 60 days. R20 + 1% of investment (includes brokerage, STT, IPL, STRATE and VAT)
Standard online share trader R 60 – this will be wavered if 3 or more trades are made within a month. None R 60 or 0.5%
       
Absa* R66.67 - R 120
 
Source: FNB, Absa, Standard Bank, ETFSA, Satrix, and EasyEquities prices correct as of 25 November 2014. Absa's prices to come into effect as of 1 January, 2015.

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