An Honest Critique of FreeTrade

Which ones?

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As a user (and investor) of Freetrade, I also found myself earlier in the year reverting to T212 to grab stocks that just weren’t on FT.

I’m not a fan of their UX and I always seem to be getting kicked into their CFD product, not sure why but feels a bit predatory. I like the simplicity and honest of FT, maybe it’s clouded by my (not so large) investment in them.

I can see why T212 is attractive with (from the outside) low fees, and from what I can tell they are profitable/make most of their money from their CFD accounts (against FT ethos), but who knows how much longer they’ll allow that product to fund other users. Here’s something to bear in mind (from their forum):

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My biggest criticism of FT is that it’s slow to add hot stocks / spacs. NNDM, DPHC, Tencent, GPV (green power), Blink, there are loads of overhyped stocks that are STILL not on the platform. I can live with having to pay 1% every time I buy/sell something and even with $10 subscription on top of it but at least let us buy hot spacs that can help make this money back. That is a real deal breaker.

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Freetrade are always going to have to balance the specific requests to list a few individual shares against the current strategy of trying to list more stocks in bulk seeing as they’ve added hundreds and hundreds of stocks over the last few weeks.

With SPACs I think theyre looking at how to list more of those in the future so hopefully will be able to give you what you’re after.

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I see recent Freetrade moves as a lack of proper strategy. Who are they building this for? I personally have no clue.

Are they targeting growth investors? — then where are hot spacs?
Are they catering to super long term passive investors? — where is the SIPP?
Young affluent families? — where is investment JISA?
People who want efficient investing? — where are low FX rates and USD accounts?
People who are new to investing? — where is more guidance in regards to how real time pricing works for example which is driving every new investor crazy?

I am sure they have done at least basic research and have personas or customer segmentation or whatever it is but this makes me wonder what those are.

They can’t do everything all at once it’s a process that takes time. They are in the process of doing a bunch of what you suggested. They have started adding more SPACS; SIPP’s are coming soon pending HMRC approval and the waitlist is open for them; I think a JISA is somewhere down the line as well as a LISA; they have improved pricing to have shorter refresh windows but have stated live pricing is very expensive; and they are aiming to add stock fundamentals, news and articles for new investors before Christmas.

They don’t have to target one specific niche group they’re targeting various demographics who would want to engage in long term investing, they have said frequently this is their goal. They have made it clear they are not for day trading, but for long term investing which can have various methods and demographics within that and they are developing the app to cater for any of these people but it won’t happen overnight.

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Fundamentally, freetrade are building (completely from scratch) a platform that goes against decades and decades of standard retail investment conventions.

I’m with you, they need to do as many of those features as you said as possible but they have to do it sustainably. Have you seen the Christmas list?

Beyond perplexed by this post. I can’t understand how you have the time and willingness to post it but not the same to do the research on the company you’re questioning.

Many of the points you’ve noted are already in development, part of the roadmap, or have been discussed through various mediums, and to say FT don’t have a strategy or specific target for it’s offering with a clear ethos at the heart of the company is, frankly, bewildering.

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“Everyone is our audience and everything is on the road map” is not a strategy.

Unless you are referring to something I don’t know about.

https://freetrade.io/building-freetrade - this, probably

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I think the strategy is pretty clear, in fact it’s detailed on their homepage:

We’re on a mission to get everyone investing, building a platform to help customers achieve better long-term financial outcomes.

I’d actually argue every “recent move” that FT has recently made is in alignment with that clear and transparent mission statement. The SIPP waiting list is out, more stocks and ETFs are being added at pace, Stock fundamentals/in-app content are due before Christmas, Plus has shipped, MWRR/TWRR are out, amongst many other updates.

While you believe they need to target a very specific niche of investors, they appear to somewhat disagree it needs to be done to that extent, and with the speed of growth - in particular user growth - they are enjoying, I’d be inclined to think they’re right.

To pick up on your particular point about “people who are new to investing?”, the FT Invest Hub is a solid resource (also listed on their homepage). In fairness it doesn’t contain guidance on real time pricing at the moment, but have you requested that? There’s new content added to that hub every single week, so it seems unfair to pick up on specific areas of missing content.

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While I don’t think that Freetrade need to target a specific niche of customers, I would agree with the sentiment that Freetrade have been targeting those who trade frequently as opposed to the majority of investors who tend to buy and hold.

I would also be cautious about concentrating on the growth of user numbers - as an investor or for a PE they are always good to see - but worth noting the FCA has recently raised concerns that too many new firms are concentrating on this metric at the expense of others.

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That’s interesting. Do you have any link for that? Thanks.