Always remember that investments can go down as well as up in value, so you could get back less than you put in. A rule of thumb is to hang on to your investments for at least five years to give them the best chance of providing the returns you are hoping for.

Best ETF Platforms in the UK

Updated On: Nov 28, 2022
Best ETF Platform UK

Contents:

Best ETF Platforms

We’ve compiled a list of some of the best ETF platforms in the UK. These are investment apps, platforms, websites and fund supermarkets where you can buy, sell and hold ETFs and other investment products in the UK.

Please remember that when you invest, your capital is at risk. ISA, pension and tax rules also apply.

Compare some of the best ETF platforms in the UK below:

InvestEngine - Low cost; 500+ Commission-free ETFs

InvestEngine Logo
Annual Platform Fee
0% - 0.25%
Dealing Charge
£0
Regular Investor Charge
£0

InvestEngine is a UK low-cost investment platform providing a choice of managed portfolios tailored to you and commission-free DIY investing to help you build long-term wealth. Users can invest in over 500 exchange-traded funds (ETFs) from iShares, Vanguard and other leading brands. With InvestEngine, you can invest in two ways depending on your investing savviness: Beginner investors or those who prefer to choose a ready-made investment portfolio can select from one of the Managed Portfolios on offer where the team of experts at InvestEngine will take care of the day-to-day investment decisions for you. These portfolios attract a platform fee of 0.25% per year. Advanced or more confident investors can choose from 500+ commission-free ETFs and build their portfolios themselves. With the DIY Portfolio, there are no platform fees. All InvestEngine portfolios are free of setup fees, dealing fees, ISA fees or withdrawal fees. InvestEngine allows you to invest via a Stocks and Shares ISA, Personal Account or Business Account.

Promo: £25 welcome bonus for new customers who invest at least £100. Terms apply.

Capital at risk.

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Freetrade - Low cost; 250+ Commission-free ETFs

Freetrade
Annual Platform Fee
£0
Dealing Charge
£0
(+ 0.45% FX fee)
Regular Investor Charge
£0

Freetrade is a UK mobile trading app that gives you access to thousands of UK and overseas stocks, ETFs and investment trusts covering different sectors and markets worldwide. The Freetrade app can be accessed on iOS and Android and offers a slick and easy-to-use user interface and experience. The app is also a great choice for both beginners and experienced investors. With Freetrade, you can invest in fractional shares of even the most expensive US shares with as little as £2. Depositing, trading and withdrawing on Freetrade are commission-free (other charges may apply). FX rates also apply for US stocks at the spot rate + 0.45%. Freetrade’s products include a Stocks and Shares ISA, General Investment Account and SIPP.

Promo: Get a free share worth £10 when you join Freetrade and fund your account with at least £50.

Please note: When you invest, your capital is at risk. The value of your investments can go down as well as up, and you may get back less than you invest. ISA rules apply. SIPP eligibility and tax rules apply. Free share terms and conditions apply.

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eToro - 0% Commission on real stocks; 250+ ETFs

eToro Logo
Annual Platform Fee
£0
Dealing Charge
£0
Regular Investor Charge
£0

eToro is a multi-asset platform that offers both investing in stocks and cryptoassets, as well as trading CFDs. It is entirely free to open an account with eToro, and all registered users receive a US$100,000 demo account for free, which you can use to practice trading until you become confident. eToro gives you real-time access to thousands of stocks, ETFs and cryptocurrencies from top exchanges worldwide. If you prefer to select a ready-made portfolio, eToro has over 40 fully allocated, balanced investment portfolios, focusing on market segments you can understand and to which you can relate. Some of the portfolios include MetaverseLife, BigTech, GoldWorldWide, Vaccine-Med, BitcoinWorldWide, Diabetes-Med, Driverless, GigEconomy, and many more. These portfolios are a grouping of several assets, such as stocks, cryptocurrencies, ETFs, and even people, bundled together based on a predetermined theme or strategy. Withdrawals incur a fee of US$5, and FX rates apply to non-USD deposits and withdrawals. eToro does not offer an ISA or SIPP.

Please note: When you invest, your capital is at risk. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Additionally, cryptoassets are highly volatile and unregulated in the UK. No consumer protection. Tax on profits may apply.

Your capital is at risk. Other fees apply. For more information, visit eToro.

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Interactive Investor - One free trade per month; 40,000+ Investments

Interactive Investor
Annual Platform Fee
£120 - £240
Dealing Charge
£5.99
Regular Investor Charge
£0

Interactive Investor, recently acquired by wealth management giant abrdn, is the second-largest investment platform in the UK. Interactive Investor is well known for its fixed charges (as opposed to percentage-based fees like most other investment platforms), and it has been providing investment services and financial information since 1995. If you choose to invest with Interactive Investor, you’ll gain access to over 40,000 investment options, including UK and overseas shares, funds, investment trusts, and ETFs. This is the widest choice of UK and international investments offered by any investment platform in the UK. You will also be able to access 17 global exchanges, including exchanges in North America, Europe and Asia Pacific. These include markets such as the FTSE 100, FTSE 250, FTSE All-Share, NASDAQ, Dow Jones and more. In addition to the exchanges above, Interactive Investor offers Japanese, Indian and Chinese shares in the form of ADRs (American Depositary Receipts).

Interactive Investor gives you a free trade every month, which you can use to buy or sell any investment. After that, trades usually cost £5.99. Interactive Investor also offers a free regular investing service that allows you to invest regularly without paying a trading fee each time. The site also has lots of expert ideas, research and insights, which can be helpful when choosing investments. Interactive Investor’s services include a Trading Account, Stocks and Shares ISA, SIPP and Junior ISA.

Capital at risk.

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AJ Bell - Mid-price range; 3,000+ ETFs

AJ Bell Logo
Annual Platform Fee
0.25%
(max £3.50 per month)
Dealing Charge (Online)
£9.95 - £4.95
Regular Investor Charge (Online)
£1.50 per deal

AJ Bell is one of the UK’s largest online investment platforms, and it is on a mission to make investing as easy as possible for you. The platform offers a wide range of investment options for the DIY investor, including shares, funds, investment trusts and ETFs. Beginner investors or those who prefer to choose a ready-made investment portfolio can get a little, or a lot, of help from AJ Bell’s specialists by selecting one of the investment ideas on offer. There are eight total fund ideas, each built by a specialist team, and you can pick the right one for you depending on your attitude to risk and whether you’re seeking to simply grow your money over time or receive an income whilst still growing your money.

AJ Bell charges an annual platform fee ranging from 0.25% to 0%. Dealing fees for buying and selling investments online are £1.50 for funds and £9.95 for shares (reducing to £4.95 if there were 10 or more online share deals in the previous month). AJ Bell’s services include a Share Dealing Account, Stocks and Shares ISA, Lifetime ISA, Junior ISA, SIPP and Junior SIPP.

Capital at risk.

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Hargreaves Lansdown - Lots of research, ideas and tips

Hargreaves Lansdown
Annual Platform Fee
£0
‍‍(Fund & Share Account)
Dealing Charge (Online)
£11.95 - £5.95
Regular Investor Charge
£1.50 per deal

Hargreaves Lansdown has thousands of investments to choose from, including UK and overseas shares, funds, investment trusts, and ETFs. It does not charge a platform fee on its Fund and Share Account but charges 0.45% (capped at £45) a year on its ISA and 0.45% (capped at £200) a year on its SIPP. It offers most products, including Fund and Share Account, Stocks and Shares ISA, Lifetime ISA, Junior ISA, and SIPP. These services are intended for investors happy at making their own decisions.

Please note: The Hargreaves Lansdown Fund and Share Account is intended for investors happy at making their own investment decisions. Your capital is at risk. The charges quoted here are not exhaustive - other charges apply.

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Wealthyhood - Low cost; 50+ Commission-free ETFs

Wealthyhood logo
Annual Platform Fee
£12
Dealing Charge
£0
(+0.4% FX fee)
Regular Investor Charge
£0

Wealthyhood is a UK mobile trading app that gives you access to 50+ thematic ETFs, real-time guidance, insights and more than 120,000 personalised portfolio templates. With Wealthyhood, you can buy as little as £1 of your favourite ETFs with fractional shares.

The Wealthyhood Beginner plan costs £1 per month and allows you to invest in ETFs without commissions or limits. However, an FX spread of 0.4% applies to all international ETFs. The ISA plan (coming soon) costs £3 per month and offers everything included in the Beginner plan, plus ISA accounts. The Pro plan (also coming soon) costs £7 per month and gives you access to individual stocks, premium tools, analytics and insights.

Promo: Get a free share worth up to £200 when you join Wealthyhood and fund your account.

Capital at risk.

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FinecoBank - Low cost; 20,000+ Investment options

FinecoBank Logo
Annual Platform Fee
£0
Dealing Charge
£2.95
Regular Investor Charge
£0

FinecoBank is one of Europe's largest banks, with 20 years of leadership history in brokerage and over 30 million orders processed every year. Its core mission is to make online trading simple by providing direct access to the markets in just one click. With Fineco, you can access 26 global markets and trade over 20,000 financial instruments worldwide on a single account, including UK and overseas shares, ETFs, funds, bonds, and CFDs. Users can also invest and trade directly in GBP, EUR, USD, Swiss Franc and 20+ currencies. FinecoBank's products include a Trading Account and Stocks and Shares ISA.

Promo: Apply with the link below by the 31st of December 2022, and trade commission-free up to a maximum commission amount of £500. Terms apply.

Please note: When you invest money, your capital is at risk. 71.97% of retail investors lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and can afford to take the high risk of losing your money.

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Saxo Markets - 60,000+ Investment options; Diverse product range

Saxo Markets logo
Annual Platform Fee
0.12% - 0.08%
(min €120 (~ £108))
Dealing Charge
0.10% (min. £8) UK Stocks
US$0.02 (min. U$10) US Stocks
Regular Investor Charge
£0

Saxo Markets is the UK division of Saxo Bank, a large European bank that allows you to invest in 60,000+ financial products from stock markets worldwide. With Saxo Markets, you can invest in UK and overseas stocks and shares, bonds and ETFs. If you are interested in more sophisticated products, Saxo offers advanced trading products such as forex, CFDs, futures, commodities and options. Saxo Markets allows you to invest in one of two ways depending on your investing savviness and attitude to risk: Beginner investors or those who prefer to choose a ready-made investment portfolio can select from one of the Managed Portfolios on offer where Saxo experts navigate the markets and manage your investments on your behalf. The average cost of this managed portfolio is 0.95% per year (including fund costs). Advanced or more confident investors can choose from the range of financial products on offer and build their portfolios themselves.

Saxo Markets has different transaction fees grouped into trading tiers. If you plan to trade high volumes, you can upgrade your tier to get lower transaction fees. The Classic tier, which attracts the highest trading fees, costs 0.10% (min. £8) per deal for UK Stocks and US$0.02 (min. US$10) per deal for US Stocks. Other fees apply. Additionally, other exchanges, such as those in Europe or Asia, have different trading fees, which you can find on Saxo Markets’ website. Saxo Markets’ suite of products includes a Trading Account, Stocks and Shares ISA and SIPP.

Please note: Capital at risk. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

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DEGIRO - Cheap share dealing; 200 Commission-free ETFs

DEGIRO logo
Annual Platform Fee
£0
Dealing Charge
£1.75 + 0.014% (UK Stocks)
Regular Investor Charge
£0

DEGIRO is an award-winning investment broker that allows you to trade in stocks, bonds, ETFs, options, futures, warrants, certificates and more across 50 international exchanges. It offers tens of thousands of regulated financial instruments that enable investors to diversify their portfolios worldwide. With DEGIRO, you can invest in up to 200 commission-free ETFs. This means you may not have to pay a dealing charge when you invest in just ETFs (terms apply). Dealing in UK stocks costs £1.75 + 0.014% per deal, while US stocks cost €0.5 + $0.004 per share and Irish stocks are €4 + 0.05% per deal. To make sense of the charges, click here. DEGIRO currently has over 1 million customers across 18 countries. It is suitable for both beginners and advanced investors, and you can access the platform on any device via the web portal or mobile app. DEGIRO does not offer an ISA or SIPP.

Capital at risk.

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Bestinvest - Low cost; Lots of investment options and research

Bestinvest logo
Annual Platform Fee
0.4% - 0% (DIY)
0.2% - 0% (Ready-made)
Dealing Charge (Online)
£4.95
Regular Investor Charge
£0

Bestinvest is a UK investment platform offering about 2,500 funds, UK shares, investment trusts and ETFs. With Bestinvest, you can invest in one of two ways depending on your investing savviness: Beginner investors or those who prefer to choose a ready-made investment portfolio can build their investment pot by selecting one of Bestinvest’s ready-made investments. These investments are fully diversified and created and managed by the team at Bestinvest. Once you’ve picked one, you don’t need to do anything else. Advanced or more confident investors can choose from a wide range of funds, shares, ETFs and ITs and build their investment portfolios themselves. Bestinvest also has an investment search tool that makes it easy to browse and filter all of the investments, and you can use their free guides and articles if you need any inspiration. They are quite popular for their Spot the Dog guide which shows a list of poorly performing funds you probably want to avoid. Bestinvest’s products include a Stocks and Shares ISA, General Investment Account and SIPP.

Capital at risk.

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Vanguard - Low cost; 70+ Funds

Vanguard Investor'
Annual Platform Fee
0.15% (max £375)
Dealing Charge
£0
Regular Investor Charge
£0

Vanguard is a popular low-cost investment platform with over 70 funds. You can only invest in its own funds, and it does not offer share trading. It gives you the flexibility to choose a ready-made portfolio or build your own. Vanguard's products include a SIPP, Stocks and Shares ISA and Junior ISA.

Capital at risk.

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What Is an ETF?

An ETF is an investment fund that trades on an exchange like an individual stock. An ETF will typically track a particular index, sector, commodity, or other assets.

When an investor is looking to purchase shares in an individual company such as Apple or Tesla, they buy this through their investment platform or trading app, which is connected to a stock exchange.

Apple is listed on a stock exchange in the USA known as the NASDAQ. If you want to purchase some Apple shares, you will place the order through your app or platform. They would then pass the order through the NASDAQ exchange to purchase the shares for your account from another investor selling Apple shares simultaneously.

An ETF is an investment fund that is traded in the same way. ETFs are listed on a specific stock exchange, such as the NASDAQ, the New York Stock Exchange or the London Stock Exchange, and buyers and sellers can trade them directly.

Rather than investing in a single stock, an ETF will hold hundreds or even thousands of different individual companies or investments.


How Do ETFs Work?

Let’s start with the basics. Before we explain how an ETF works in more detail, we need to take a step back and start with the F in ‘Exchange Traded Fund’.

An investment fund (or fund for short) is essentially a pool of investors’ money. It is run by a professional investment company that offers to invest people’s money in a certain way. Say, for example, an investment manager decides to start a fund called the Big Investment Automotive Fund to invest in car companies. Investors could hand over their money to the investment manager, who would then combine all of this cash and allocate it to companies like Ford, GM, Tesla and Volkswagen.

Not only will the fund specify the type of investments it will hold (such as car companies), but it will also specify the strategy it plans to use to generate returns. This could be an income strategy that focuses on companies that pay consistent dividends, a high-growth strategy which aims to find smaller companies with big growth potential, or a strategy that focuses on something else entirely.

There are funds for just about any type of investment you can imagine. Some of them are very specific, like the automotive example above. Some are broader, such as investing across the entire UK or US stock market. Some are much broader, investing across the whole “world” stock market.

Stocks make up a significant component of fund investment, but there is a huge variety of fund options for other asset classes too. Examples include bonds or fixed interest, real estate, infrastructure, gold and even cryptocurrencies like Bitcoin and Ethereum.

These funds allow any investor to purchase a portion of the fund, regardless of whether they have £100 or £1 million to invest.


ETF vs Index Fund

Now you understand that an investment fund is a pooled pot of money invested in a specific way by a professional fund manager. But what about the ‘Exchange Traded’ part of the ETF acronym? All this means is that the ETF can be traded on a stock exchange, just like a regular single share in a company.

Investment funds were traditionally only able to be bought and sold directly from the fund manager and only priced at the end of each day.

For example, if you wanted to buy a fund, you would register with an investment app or platform where you would be able to purchase units of a fund based on the next available closing day price. With an ETF, you can buy and sell every minute of the trading day and hold multiple different ETFs on your trading app or platform.

We will get into the specifics of the pros and cons of each next, but really the differences are not that significant. Large investment houses will often offer both a traditional fund and an ETF of the same fund.

While not all ETFs are index or passive investments, the vast majority are. This is why ETFs are most commonly compared to index funds rather than actively managed investment funds.


Pros and Cons of ETFs

The following are the pros and cons of investing in ETFs:

Pros

  1. Diversification: Investing through an ETF means you can access a much greater level of diversification. A fund manager can invest your money into hundreds or even thousands of different individual holdings through a single ETF. This is very difficult and expensive to do yourself, even if you have millions to invest.
  2. Cost: Because the costs of investing are shared across all of the investors in the fund, the fund manager is able to provide significant benefits for a relatively low cost.
  3. Liquidity: ETFs are traded just like stocks, which means you can buy and sell them quickly and easily. Once you place a trade, you’ll receive the price as of that moment, and if it’s a sale, the money will be in your bank account in a matter of days.

Cons

  1. Less Choice: Not all investment funds are available as ETFs. Index or passive funds are the most common ETFs available, with actively managed funds and niche investments in areas such as emerging markets or specific market sectors less common.
  2. Costs: Yes, this is listed as a con as well as a pro! While the value for money of an ETF is excellent, it is still more expensive than investing in direct shares. These have no ongoing costs, so you will pay slightly more to hold ETFs rather than individual stocks directly.

How to Invest in ETFs

You can invest in ETFs with investment platforms such as InvestEngine, Freetrade, AJ Bell, Interactive Investor or Vanguard.

Follow the steps below to invest in ETFs:

  1. Choose a Tax Wrapper: The first step is to decide which type of tax wrapper you want to invest with. A tax wrapper reduces the amount of taxes you pay on your investments. Some examples include a Stocks and Shares ISA, Lifetime ISA, Private Pension or General Investment Account. Keeping taxes down can significantly affect your long-term gains, so it’s worth taking the time to choose the best option.
  2. Choose an Investment Platform: A platform is a broad term for any broker, app or website that allows you to purchase investments. There are a huge number of options to choose from, all with their own pros and cons. Make sure you choose one that offers the tax wrapper you selected in the first step. We’ve broken down the details for several of the best options for investing in ETFs above.
  3. Create an Investing Strategy: Most people follow Bogleheads’ Three-Fund Portfolio strategy, which suggests building a three-fund portfolio comprised of only basic asset classes, usually a domestic stock “total market” index fund, an international stock “total market” index fund and a bond “total market” index fund. We break this down in simple terms here.
  4. Pick Your ETFs: The next step is to choose the ETFs you want to invest in within your new account. This is not a case of just picking the ones that offered the best returns from last year. You need to decide on an investment strategy and then find ETFs that match it. Do you want to invest in the US, the UK or a mixture of the total world stock markets? Do you want to only invest in stocks, or do you want some bonds and property investments too? Are you investing for income or capital growth? Different ETFs will offer strategies and investments that align with your answers to these questions.
  5. Consider Fees: Finally, Make sure you also consider ETF fees. If you are finding it hard to choose between a few different ETFs and cannot see much difference between them, it might be worth going with the one that has the lowest fees.

How Do ETF Charges Work?

ETF fund managers charge for their services the same way that almost every investment fund does. That is, they charge investors a percentage of the value of the money that they look after.

This fee can vary pretty widely, from as low as 0.04% to over 2.00% for more niche or exotic ETFs. 

This means that if an ETF were charging 0.25%, an investor with an average balance of £20,000 would pay annual fees of around £50. Pretty good value to have a professional manager run your portfolio for you.

Keep in mind that the ETF fee is just one of the types of charges that you could incur. Some platforms also charge you money to hold funds or to trade as well, though there are a number of free options available to investors these days.

Frequently Asked Questions

1. What is an ETF’s expense ratio?

An ETF’s expense ratio is another name for the fees charged by an ETF fund manager. The figure is expressed as a percentage of an investor’s daily average balance, and can range from 0.04% to over 2.00%.

2. Can I invest in only ETFs?

Yes, you can invest in only ETFs. However, most investment platforms or trading apps will allow you to invest directly in stocks alongside ETFs if you want to. This means you can have a portfolio that is only ETFs, or you can have a mix of ETFs and individual company shares.

3. Are ETFs good for beginners?

Yes, ETFs are an excellent way for beginners to invest. They provide access to professional investment managers at a very reasonable cost and allow for much greater levels of diversification, even with small amounts of money.

4. How many ETFs should I start with?

You can start with as little as one ETF, as some of them invest all across the world and in a range of different asset classes. These are known as Multi-Asset ETFs and are based on the level of risk you want to take with your money, from low to moderate to high.

5. Do ETFs pay dividends?

Yes, some ETFs pay dividends. ETFs usually offer an Accumulation or an Income version of the fund. Both will receive dividends from the companies they hold, but only the Income version of the ETF will automatically pay these out to investors. The Accumulation version will instead automatically reinvest the dividends into the portfolio. This reinvestment strategy is great for long-term gains. If you want dividends from your ETFs, you should invest in ETFs of the Income class.

6. What are the best brokers for ETFs?

Here are some of the best brokers for ETFs:

  1. InvestEngine - Low cost; 500+ Commission-free ETFs
  2. Freetrade - Low cost; 250+ Commission-free ETFs
  3. Interactive Investor - One free trade per month; 40,000+ Investments
  4. AJ Bell - Mid-price range; 3,000+ ETFs
  5. Hargreaves Lansdown - Lots of investment options, research and tips
  6. FinecoBank - Low cost; 20,000+ Investment options
  7. DEGIRO - Cheap share dealing; 200 Commission-free ETFs

7. Are ETFs safer than stocks?

Generally speaking, ETFs are safer than stocks. ETFs will almost always mean greater diversification for an investor. This means your money is spread further, which reduces the chance of a small number of bad apples ruining an entire portfolio.

8. What is the downside of ETFs?

The main downside of ETFs is that there is an ongoing fee payable to invest in them. 

9. How often should I buy ETFs?

You can buy ETFs as often as you like. A common strategy is what’s known as ‘pound cost averaging. This is when an investor sets up a direct debit or standing order (e.g. monthly) which automatically buys a set amount of an ETF. This means the investor automatically ‘buys the dip’ when markets crash and can smooth out long-term returns.

10. Which investment platforms are the cheapest for ETFs in the UK?

Here are some of the cheapest platforms for ETFs UK:

  1. InvestEngine - Low cost; 500+ Commission-free ETFs
  2. Freetrade - Low cost; 250+ Commission-free ETFs
  3. eToro - 0% Commission on real stocks; 250+ ETFs
  4. FinecoBank - Low cost; 20,000+ Investment options
  5. DEGIRO - Cheap share dealing; 200 Commission-free ETFs
  6. Vanguard - Low cost; 70+ Funds

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