Trading 212: A Beginner's Guide To Investing

Trading 212 is a platform that offers commission-free investing, an auto-invest feature, and a large variety of stocks and ETFs to choose from. It provides a range of investment options, from buying stocks instantly to investing in ready-made or custom pies. Users can also take advantage of fractional shares, which allow them to own even the most expensive stocks, such as Google, Amazon, and Apple. The platform offers a seamless user experience with its user-friendly interface, comprehensive analysis tools, and top-notch educational resources. Additionally, it provides exceptional customer support and efficient transaction processes. Trading 212 is an excellent choice for investors seeking a blend of convenience, efficiency, and robust features.

How to buy stocks instantly

Trading 212 is a platform that offers zero-commission investing, an auto-invest feature, and a large variety of stocks and ETFs to choose from. It is a user-friendly platform that is suitable for beginners and experienced traders alike.

• Open an Account: Click 'Open Account' on the Trading 212 homepage, confirm your country of residence, and select the Trading 212 ISA account. Create your login details and verify your identity.
• Fund Your Account: You will need to add funds to your account before you can start investing. You can choose to make an instant bank transfer or add funds using a debit card or Google Pay.
• Search for Stocks: On the Trading 212 homepage, you can search for stocks by company name or filter based on 'top winners' and 'top losers'. You can also browse stocks by their industry, such as big tech and banks, or by their trading location, such as the US or UK.
• Place a Buy Order: Once you have found the stock you want to purchase, click on the company and then hit 'Buy'. Choose the type of order (market, limit, stop, or stop limit) and the value of your investment. Review your order and then click 'Send Buy Order' to confirm the transaction.

It is important to note that when investing, your capital is at risk, and you may get back less than you invested. Past performance does not guarantee future results.

How to earn interest on your portfolio

Share lending is the process of a lender transferring their shares to a borrower. In return, the lender receives daily interest and collateral. Trading 212 lends shares from your portfolio to reputable borrowers and receives interest in exchange. This interest is then split equally between you and Trading 212.

Share lending is based on supply and demand. Shares with low availability and high demand are more likely to be borrowed. There is no minimum or maximum amount that can be lent. Each day your shares are lent, Trading 212 receives interest and passes 50% of it to you. The interest rate is variable and based on supply and demand.

Share lending is a complex product that comes with associated risks. For example, there is a risk that the borrower doesn't return your shares. To safeguard against this, your shares are secured by collateral in the form of US treasury bonds, protected as any other client investment. The collateral minimum is 102% of the shares' value, and it is adjusted daily.

Another risk is intraday price volatility. The value of your lent shares can increase, or the collateral value can decrease, leaving you insufficiently collateralised. As mentioned, the collateral is a minimum of 102% of the value of your lent shares and is adjusted daily to mitigate this risk.

Share lending can be a great way to boost your investment returns. It is fully automatic and will never cause delays when selling. You still get paid dividends in full, and you can disable share lending at any time. There are also no restrictions on your trading—you can close, modify, and add to a position even if your shares are lent.

To enable share lending, open the Trading 212 app and follow a brief series of steps that explain how share lending works and the associated risks.

How to use Trading 212's share lending feature

Trading 212 offers a share lending feature that allows you to earn daily interest on your portfolio. Here's a step-by-step guide on how to use this feature:

Step 1: Eligibility

Firstly, ensure that you have an eligible account for share lending. Only Invest accounts with Trading 212 UK are eligible, while ISA accounts are not due to HMRC regulations.

Step 2: Understanding the Process

Share lending involves transferring your shares to a borrower, who will then provide daily interest and collateral in return. Trading 212 acts as the intermediary, lending shares from your portfolio to borrowers and splitting the interest equally with you. The interest rate is variable, based on supply and demand.

Step 3: Enabling Share Lending

You can enable share lending in the Trading 212 app. During this process, you will follow a brief series of steps that explain how share lending works and outline any associated risks.

Step 4: Managing Your Shares

Share lending is fully automatic and will not cause any delays or restrictions when you want to sell your shares. You can close, modify, or add to your position even when your shares are lent out. Additionally, you will still receive dividends in full as manufactured dividend payments.

Step 5: Collateral and Protection

Your lent shares are secured with collateral in the form of US treasury bonds. The collateral minimum is 102% of the shares' value, and it is adjusted daily. In the unlikely event that Trading 212 or other parties go bankrupt, your assets are protected up to £85,000 by the FSCS.

Step 6: Loss of Voting Rights

It's important to note that when you lend your shares, you lose your right to vote with those shares. Additionally, lent shares may be used for shorting by traders, which could potentially affect the value of the stock.

Step 7: Transparency and Control

Trading 212 provides complete transparency by showing you which stocks are lent out and how much interest you're earning. You can also disable share lending at any time with a single tap. Disabling share lending takes two trading days, and you will no longer earn interest on your shares.

How to transfer your portfolio to another broker

Trading 212 allows you to transfer your portfolio to another broker without closing your positions. This feature is available to 80% of users, with the full release delayed to ensure acceptable processing times. You can transfer your portfolio by following these steps:

• Contact your new broker and fill out their transfer authority document.
• Have your new broker send the document to Trading 212 at one of the following mailboxes, depending on the transfer type:
• Outbound stocks & cash (ISA) - [email protected]
• Outbound stocks (Invest) - [email protected]
• Outbound cash (ISA) - [email protected]
• Alternatively, you can send the document by post to Aldermary House, 10-15 Queen Street, London, EC4N 1TX.
• Trading 212 will contact you to approve the request once they receive it.
• Trading 212 will keep you updated on the progress of your transfer until completion.

There are no exit transfer fees charged by Trading 212, but other brokers may have fees, so it is worth checking with them. It is also important to consider that potential losses may be incurred from selling and repurchasing assets when you transfer your ISA in cash.

You can transfer your whole portfolio or just part of it. If you choose to transfer stocks, your entire ISA portfolio will be transferred. If you want to transfer part of your ISA portfolio, you can do so via a cash transfer. Current-year subscriptions must be transferred in full.

You can also transfer your position without selling your shares by making a portfolio transfer.

How to Use Trading 212 Invest

Trading 212 offers zero-commission investing, an auto-invest feature, and a large variety of stocks and ETFs to choose from. The platform allows daily trading, including pre-market and aftermarket options for US stocks. The user interface is intuitive and visually pleasing, making the trading experience enjoyable.

When investing, your capital is at risk, and you may get back less than invested. Past performance does not guarantee future results.

How to set up automatic investing

Setting up automatic investing is a great way to build wealth over time. Trading 212 offers an auto-invest feature, allowing you to automate your investments and stay committed to your financial goals. Here's a step-by-step guide on how to set up automatic investing:

Step 1: Create a Trading 212 Account

If you don't already have an account, you'll need to sign up for one on the Trading 212 website or mobile app. Provide the necessary personal and financial information, such as your name, address, and financial details.

Step 2: Fund Your Account

Before setting up automatic investing, you'll need to deposit funds into your Trading 212 account. You can do this through various payment methods, including card payments and bank transfers. Go to the Deposit window, select your preferred payment method, and enable the Recurring option to schedule automatic deposits.

Step 3: Choose Your Investments

Trading 212 offers a wide range of investment options, including stocks, ETFs, and fractional shares. You can either choose from their ready-made model pies, which are diversified portfolios curated by asset managers, or build your own custom pie. When selecting investments, consider your risk tolerance, investment horizon, and financial goals.

Step 4: Set Up AutoInvest

Once you've decided on your investments, it's time to enable AutoInvest. You can do this while creating your pie, and you can disable it at any time by going to the pie's AutoInvest section. With AutoInvest, you decide 'how much' and 'how often' you want to add funds to your investments. The newly contributed money will be allocated based on your pie's targets. For example, if you deposit £100 into a pie with five slices, each targeting 20%, £20 will be funded to each slice.

Step 5: Monitor and Adjust

Even with automatic investing, it's important to regularly monitor your investments and make adjustments as needed. Trading 212 allows you to invest, withdraw, or change your pies at any time. Remember, automatic investing does not constitute investment advice, and you are responsible for all investment and rebalancing decisions. Stay informed about the latest market trends and seek educational resources to improve your investment strategies.

Frequently asked questions