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It feels like everyone’s been talking about Trading 212 recently, thanks to its generous referral scheme that sees referrers and new customers receiving a free share up to the value of £100 when a recommendation is made.
But is Trading 212 legit? I’ve had great success with its referral scheme and made more than £80 just by signing up using a referral link - but is it a good platform for lasting investments? Read on to delve into my Trading 212 review.
If you’re looking for Trading 212 alternatives, Freetrade is a popular option and it also has a generous referral scheme. If you open a Freetrade account using this link and follow the instructions, you’ll receive a free share worth up to £200! I’ll also receive a free stock for recommending you.
What is Trading 212?
Trading 212 is a London based fintech company that allows both new and experienced investors to make investments within a variety of financial markets.
Its mobile app has more than 14,000,000 downloads, making it one of the most popular trading apps in the world.
How does Trading 212’s referral scheme work?
If you sign up for Trading 212 using an existing investor’s referral link, you’ll receive one free share up to the value of £100. The person who referred you will also receive a free share up to the value of £100. Your shares won’t necessarily be of the same value.
You can learn more about the referral scheme by visiting my mini Trading 212 review: How To Make Up To £100 By Depositing £1 Into A Trading 212 Account. I made £88 from it myself!
Trading 212 Free share update: July 2021 - Due to unprecedented demand, Trading 212 paused its account opening service earlier this year and isn’t currently onboarding new members. However, there’s a waitlist available and I’ve heard the onboarding process will resume in the coming weeks! It’s worth getting on the waitlist ASAP, even if you eventually decide against opening an account.
If you want to get started now and you’re looking for Trading 212 alternatives, Freetrade is a popular option and it also has a generous referral scheme. If you open a Freetrade account using this link and follow the instructions, you’ll receive a free share worth up to £200! I’ll also receive a free share for recommending you.
What makes it different from other investment platforms?
One of the main benefits that sets Trading 212 apart from other investment platforms is that it allows you to invest with as little as £1.
While Trading 212 is certainly not the only platform that allows such small investments, you’ll find that many investment websites and services demand that you invest hundreds or even thousands to get started. Their requirements can prevent people on modest incomes or newbie investors getting started because of the sheer commitment that’s needed.
When you can invest much smaller amounts, it’s far easier to dip your toes in the water and explore the investment world yourself. Even though returns are likely to be minimal at this stage, it’s important to just get started.
Trading 212 fees
One of Trading 212’s unique selling points is that is doesn’t charge commission. This is revolutionary in an industry that usually charges investors a percentage of their shares or investment income as commission.
There are no fees for share dealing or to store stocks in an ISA.
How does Trading 212 make money?
Trading 212 makes money through the spreads between the buy and sell price on its assets.
There is also a 0.5% conversion charge and stamp duty needs to be paid for share and ETF purchases.
There are ‘premium’ options which do cost money to access, but you can achieve a lot without paying for this service.
Is Trading 212 legit?
Yes!
Trading 212 is fully regulated by the Financial Conduct Authority and is therefore required to take a series of steps to keep your money safe, such as holding your investments in a separate client account.
Up to £85,000 of your money is protected by the Financial Services Compensation Scheme in case Trading 212 becomes insolvent.
A selection of security measures are also in place to protect your data and money.
How safe is my data with Trading 212?
Trading 212 is a legitimate company that takes your security and privacy seriously. It’s also regulated by the FCA. Here’s some key factors that have helped me to trust Trading 212 with my money and data:
- Trading 212 is authorised and regulated by the FCA (Financial Conduct Authority)
- Your funds are kept in a segregated account and are protected by the FSCS up to £85,000
- Your data is protected with the industry’s best practices
Trading 212 says: “Regular penetration tests and scans of our applications and infrastructure are performed by the US based Security Metrics. The company governance, financial, business, and IT processes and systems are audited by Grant Thornton. A dedicated 24×7 Security Operations Center monitors and analyses the traffic and alerts to protect our customers in real-time. We participate in a bug bounty program, rewarding researchers for submitted reports.”
Let’s review the Trading 212 account options:
Trading 212 Invest
Trading 212’s Invest section is ideal for both new and experienced investors.
With the help of fractional shares, you can invest with as little as £1.
Fractional shares are a way of owning a small piece of a large company such as Tesla, Apple and Google. Since a single share with these companies often costs hundreds or even thousands of pounds, fractional shares allow you to get a piece of the pie even if you’re investing with a small amount.
Trading 212 CFD
Trading 212 CFD gives you the opportunity to trade stocks, forex, indices and commodities such as gold and oil without having to pay any commission.
A CFD (contract for difference) is basically a bet on how an asset’s performance will change. For example you may choose to bet that the value of Tesla’s stock will increase. You may also choose to bet that the value of Apple’s stock will fall.
This section is for the experts and I’d recommend staying away from it unless you have lots of investing experience and you understand how trading works. Trading is extremely risky and lots of people lose money this way.
Trading 212 has even released figures that show 76% of its investor accounts lose money when trading CFDs. Reassuringly, the platform has introduced a number of measures to protect users from the volatility of CFDs. For example, it’s introduced stop-loss alerts (blocking accounts from going into a negative balance) and ‘take profit’ options (letting investors set a specific point in which they’ll stop investing). Many brokers and investment platforms don’t provide such safety measures.
Speak to a financial advisor to find out exactly what’s right for you.
Trading 212 ISA
Trading 212’s ISA offers you a way to invest money into stocks and shares and benefit from tax-free returns. While I originally started out with the Trading 212 Invest account, I eventually sold the stocks I kept in there and decided to open a Trading 212 ISA instead. My reason for this was to make the most of its tax advantages.
There’s a minimum investment of £1, though this increases to £10 if you’re setting up a bank transfer.
Unlike other brokers, there are no charges for administration, commission or dividend investment.
Trading 212 says it will execute all withdrawal requests within two business days and this can be done both on the app and through its website.
Is Trading 212 good for beginners?
For first-timers, Trading 212 offers a demo account which lets you try out the platform and perform test transactions without registration. This demo account gives you a real-time experience of how the platform works on your computer and mobile applications.
The website and app are both easy to use and you can get to grips with them within a couple of hours of playing around with it.
What training materials are available?
One of my favourite things about Trading 212 is the sheer number of training videos available in the Learn section of its website and on its YouTube channel.
You can watch these videos without creating a Trading 212 account.
With so many forex ‘experts’ and trading millionaires offering expensive training courses to those dreaming of going from rags to riches, it’s refreshing to see quality information available to anyone who wishes to learn for free.
I’m not saying you should start trading after reading one review or watching a few Trading 212 videos. Trading is complicated and best left for seasoned investors. But perhaps dip your toes in the water by learning how the stock market works and stick to that for now.
What’s the difference between trading and investing?
Trading and investing are different things.
Investing is basically you buying a stock or share in a company. As the owner of a stock in that company, you are eligible for dividends.
When you’re trading, you’re betting either for or against the performance of the price of stocks or a currency. You might ‘bet’ that the share price of Apple will increase. If it does increase, your trade has been successful. If it doesn’t, you’ll lose money.
Should I sign up with Trading 212’s referral scheme for a free share up to £100?
As mentioned earlier on in the review, if you’d like to give Trading 212 a go I’d absolutely recommend signing up via the referral scheme so you can get a free share worth up to £100.
I did this and struck lucky - quickly receiving a share with £88! Read more about my experience in this blog post.
All you need to do is click this referral link, create your Invest account, and deposit £1. You’ll usually receive your free share by the following business day. This free share could be worth anything from a few quid to a hundred.
Once you’ve got your free share, you’ll have a choice between selling it and withdrawing its value to your bank account versus keeping it and seeing how it changes with the market. It can be really interesting to see how your fund’s value rises or falls over time.
What personal details does it need?
When you go through the Trading 212 sign up process, you may be asked to share some personal details with the platform.
These include:
- National Insurance Number
- Proof of ID: a copy of your passport, driving license or national ID
- Proof of address
These are standard requirements which Trading 212 need to review as part of anti-money laundering legislation.
When will Trading 212 allow new customers?
As I mentioned earlier, Trading 212 paused its onboarding process earlier this year after the GameStop drama inspired a surge in new sign up requests.
In a post within the Trading 212 community, a member of the team wrote: “We are excited to announce that we’ve started gradually sending out invitation links to EU residents from our waitlist. UK residents - please be patient with us for a little longer. Onboarding will resume at a later point with our scaled-up Trading 212 UK broker. Any further updates will be timely posted.”
If you’ve not already joined the Trading 212 wait list, now might be a good time to get on the list. The sooner you sign up, the sooner you’ll be onboarded and will be able to use the platform to invest in the stock market.
If you found this Trading 212 review helpful, you might also be interested in my Freetrade review!
