I’m always curious how others play.
What is your typical trade size ? I typically trade for around £3K in any given fund or stock and in average keep a stock investment for ca. 2 years. I don’t tend to do daily trades, I’m more of a long term investor. My holdings are probably split between 80% growth stocks and 20% value stocks (those who I believe have been over sold or see a M&A opportunity).
I’d be interested to know some answers to this question if anyone would be so bold?
I suppose it all depends on how big your portfolio is, and few would want to share that as it’s never as high as they’d like it to be.
Being a bit old school it just feels wrong for me to buy anything less than a grand - as historically you’d get ravaged by the dealing charges. A £15 dealing charge in and out is £30 then taxes and spread added on can easily exceed £50 cost to deal, so if trading under a grand you were paying over 5% and if trading in the low hundreds you were just flushing your money down the drain really. Only trades at over 5 or 10 grand made the charges become de minimis, but for most investors that could take a long time to accumulate.
I think i have just listed the main reason why Freetrade is such a great invention, because the small investor can actually exist without being ravaged with massive fees in percentage terms.
Even though i know this is no longer the case it still feels wrong to do tiny trades and feels like a waste of my and the broker’s time buying a share or two here or there, but i am guessing that is what most users are doing.
I have a suspicion that many of the new signups are people who normally do sports betting (one of them tried to sign me up at work!) and so i feel like the average is going to be very low, maybe £10 or £20 but then possibly averaged up into the low hundreds by old timers like us thinking we must trade 4 figures?
If no one wants to share their habits, does anyone know where we can find out any anonymised data like this eg. Company reports?
I’d guess you’re right; rather on the lower side. Generally, using the median here instead of the mean (average) would tell us much more. I mostly invest 1-2 times a month to distribute my paycheck savings. But that cannot go into the thousands (not that rich haha), so it will be around 20-300 per ETF/stock. Then once dividend income is received, I immediately reinvest- if possible - so these can be as small as £2 for fractional US stocks and can occur much more frequently.
I agree with you in FreeTrade that small investors can exist. The question is though whether FreeTrade will be able to make some decent profits giving that the average pot size is just around £2K?
Also for older/pro investors they tend to, like me, trade on a desktop rather App. So I think should FT come up with a Desktop Version then the infrastructure is in place to take out the competition or at least eat big time into their pie!!
Speaking personally I trade in the hundreds of pounds but that’s because I want to invest regularly to build up a portfolio over the long term with some core investments.
I also have alot of 20 or so trades top ups of existing holdings and skimming some profit to rebalance things.
Although I’m heavily skewed in one particular share currently…
I normally stick in about £800 a month at the moment after I’ve put money in to other savings and accounts. Then I split investments up pretty evenly. I’m a long term trader so probably stick about £400 in one ETF, then I’ll split the rest in to some other companies or ETF’s
When i started on Freetrade i thought id put in £50 a month with which to buy shares. I very quickly found myself transferring double that or more. I was saving everything i could and working overtime just to get money to my account.
I can only ever transfer over money i can afford, and i wish i could put in more, but the bills have to be paid! So in general i transfer over about £100/ month and then invest in my chosen shares.
My average is £15 - 20 at a time for American shares, unless there’s a bargain then i might put in more. I tend to buy UK shares in tranches of 5 or 10 depending on the share price.
Freetrade has been a revelation for me, and i hold many shares that would have made me rich had i had more money to invest. In that way the examples above are determined by my budget and i cannot cry over missed opportunities because i simply don’t have the money. It is what it is i guess
I feel like this is what Freetrade set out to achieve and they are giving regular people like me the opportunities to invest in the companies they love or believe in, little by little, brick by brick.
You have no idea how long i have been waiting to be able do that!
Absolutely. I’ve found this happen to me. I used to have the mindset of trying to invest a set amount each month but I’m actually actively looking at every expenditure and seeing how I can put more in each month.
Its great to hear and imo allows everyone to trade in whatever they want. I remember wanting to buy my first shares years ago and thinking I couldn’t justify a £20 transaction cost back then for what was a very small amount at the time so I never got into it.
I’m one of those too. Avg. single trade is probably £50-£100.
I’m very amateur but my trades are averagely between £10’000 & £15’000.
I’ve been in and out a few companies since I began in March. I’m currently up 90% but I have made plenty mistakes. Maybe beginners luck but I think it was more to do with getting involved at the right time. I know it’s not always going to be this easy.
Im currently only in 2 companies.
Zoom +6% and Tdoc +3%.
I also put £10k into freetrade in 2019 which will hopefully be my shrewdest buy.