What are some things you should look for in investment platforms?Hampton Wealth
Investing may be an age-old practice, but the rapid development of technology has changed the way we see the concept in totality. In recent years, online investment platforms have made waves in the finance space. For the most part, these execution-only investment platform empower individual investors by providing more choice, and more freedom.
With that being said, not all investment platforms are up to par. Some of them may lack minor components that benefit investors, while other platforms are complete train wrecks with complaints and major technical issues. It might just be a question of preference in some cases. So, how are you to know which one suits you and your wealth management goals best?
Here are a few things that you should look out for when choosing an investment platform.
Look for platforms that provide the basics
Platforms should generally provide online services that help investors buy, hold and sell things like shares or trusts. The platform should be able to monitor the performance of your active investments.
If a platform lacks any of these basic aspects, it’s probably best that you continue your search elsewhere. Of course, there may be some exceptions to this rule (such as specialised platforms that are hyper-focus on one specific investment vehicle or one particular service).
Look for decent analytics
This may be subject to preference, but for the most part, investment platforms that offer comprehensive tracking and monitoring capabilities are popular choices for cautious investors. Each interface may offer tools, features and information suitable for various depths of analysis, so it’s up to you to do your homework and compare your findings in order to identify the best platform for your needs. As a rule of thumb, platforms should at least provide live updates on your running investments, provide a user-friendly preview of market rates and offer other details that can help you make quick and concise decisions on the spot.
Pay attention to charges and fees
Platforms usually charge fees based on different pricing structures. They may charge an ongoing administrative fee that comes from a percentage of your total investment. Otherwise, they might charge you a flat fee that’s due on an annual or monthly basis (this pricing model is quite common and generally quite popular among users). It’s also worth noting that your portfolio could largely determine which of these options will lead to lower fees for you.
In addition, the frequency with which you invest could also determine which platform suits you best. Some providers might charge you a certain amount every time you make a trade, while others won’t issue any fund-dealing charges at all. If you switch to another platform after signing up with one, additional charges may be incurred, since most platforms will require an exit fee.
Consider the size of your portfolio
Remember, the size of your portfolio could ultimately dictate which platform you should use. In order to avoid drowning in fees, find the option that suits your budget. Smaller portfolios (between £5,000 – £50,000) may be better off with a provider that charges a percentage fee. This way, you won’t have to bear any recurring expenses that don’t correlate with your earnings.
If you have a bigger portfolio (in the £50,000+ range), or if you are a frequent trader, you could benefit from a platform that offers a fixed fee (since increasing your investments won’t lead to increased costs based on percentages).
Look for efficient platforms with great tech
Look under the hood of any online platform (especially when a great amount of money is involved). Users of platforms now demand and expect seamless efficiency. This can be in the form of the interface’s ability to reduce administrative workload (manual tasks or billing). If these aspects seem inconvenient from the get-go, consider doing more research before signing up.
Look for platform versatility and stability
Platforms should cater to a wide range of clients from different walks of life and with unique investment needs and preferences. If a platform lacks investments, versatility is compromised.
On the other hand, a wide range of investments is pointless if a platform’s foundation is not secure. Real issues can arise if small technical errors aren’t resolved quickly. This boils down to platform maintenance and service management on the back end. Look for reviews, updates and testimonials. See if there are any serious complaints and whether or not they are frequent.
Signing up for an investment platform can be exciting. However, not all platforms are created equal and depending on your goals, some may lack the features you need. Our esteemed advisors have the knowledge and experience to guide you in your investing journey. Contact us today and schedule a call to find out what investment is right for you.
Hampton Wealth specialises in sourcing high quality, listed bonds and funds with a focus on providing returns in excess of normal off the shelf investment options.
Find out more at HamptonWealth.com