Trading used to be a complex thing that could only be handled by the professionals on Wall Street. However, the advent of online trading brought about a much-needed change to the narrative. Today, anyone with a computer, a good internet connection, and enough change to spare can buy and sell shares from the comfort of his home.
South Africa has witnessed a remarkable improvement in online trading in the last few years. With a market capitalization of $1 trillion, the Johannesburg Stock Exchange (JSE) in South Africa remains the largest stock exchange in Africa.
As a beginner, there are several options that you can choose when you are just starting. Online trading can be in terms of commodities, cryptocurrencies, shares, Forex, Contracts for Differences (CFDs), bond indices, binary options, etc.
Share Trading Platforms in South Africa
Share trading involves the buying and selling of shares to make a profit. Share trading platforms provide the tools needed to trade those shares. As a trader, there are two ways you can profit while trading shares; capital growth and dividend.
Capital growth is mostly common for long-term investors who receive profits from their investments. Also, if a trader buys shares and holds on to them long enough, he might reap the benefits from the profits made by the company. However, most traders prefer buying and selling shares to make an instant profit.
The best trading platforms available in South Africa offer access to both the local and international markets. After you open a trading account on any of those platforms, you can trade locally through the Johannesburg Stock Exchange (JSE) or internationally through the New York Stock Exchange (NYSE), the National Association of Securities Dealers Automated Quotations Exchange (NASDAQ) in the United States, and the London Stock Exchange (LSE).
CM Trading – Based in Johannesburg, is an online share trading platform is one of the largest trading platforms in South Africa. Opening a trading account with CM is completely free of charge. However, you have to pay a 2% charge to deposit money on your account or to withdraw from it. If your account is inactive for a year, you will be charged $15 per month as an inactivity fee. CM Trading offers a wide range of investment options including commodities, cryptocurrencies, and Contracts for Differences (CFDs). CM Trading is regulated by South Africa’s Financial Sector Conduct Authority (FSCA) to ensure that the risk for the client is kept relatively low.
CM trading also offers a free demo account to help you learn the ropes before you start trading with real money. CFD trading on the CM platform is similar to the other platforms in terms of the amount of risk you are exposed to. However, this platform allows you to trade CFDs on bond indices, shares, currency pairs, and precious metals.
eToro platform is one of the best share trading platforms in the country. With over 10 million users, this broker offers access to more than 800 stocks from 17 international markets. As a user, you will get to trade shares and other commodities without paying commission. Although you are required to pay a flat rate of $5 on every withdrawal, depositing money on the account is free of charge. eToro minimum deposit South Africa is one of the higher in the industry, but supported by one of the most versatile platforms out there.
You will have access to a free demo account containing about $100,000 for learning how to trade before moving to a real account where you have to trade with real money. eToro also provides its users with social and copy trading where you can make the exact moves that the top earners and the best traders make. This ensures that you make profits while they are also making profits.
The safety of your capital is guaranteed on the eToro platform. This is because it is heavily regulated by several global financial authorities including the Cyprus Securities & Exchange Commission, the UK Financial Conduct Authority, the Australian Securities and Investments Commission, among others.
To lower your risk and protect your investment, eToro allows you to set price points for both your opening and closing positions.
Cheapest Share Trading Platform in South Africa
Whether you are a beginner or an experienced trader, you do not want to pay exorbitant fees for a decent trading platform. However, while you are looking to find a cheap trading platform, it would be in your best interests to consider other factors too. What you should be looking out for is the platform that gives you the best value for your money, no matter how small. Therefore, this verdict is for the cheapest reliable share trading platform out there.
Cost plays a very important role in determining the rating and popularity of a trading platform. After evaluating all the costs associated with trading which include the commission, minimum deposit, deposit/withdrawal charge, spread, maintenance fees, overnight fees, currency conversion fees, account opening fees, and inactivity fees, eToro appears to be the cheapest share trading platform in South Africa.
You might ask why eToro. After all, the platform charges a $5 flat rate for every withdrawal. However, eToro makes up for this charge in so many ways. Its demo account offers $100,000 for trading shares in real-life trading conditions without using real money. It allows you to open a trading account free of charge. No extra charge for deposit and it charges one of the smallest inactivity fees ($10). These are some of the reasons eToro remains the cheapest share trading platform in South Africa. It offers you good value for the small amount you end up spending.
Best Share Trading Platform in South Africa
Hardly will you ever see a single platform that would be the best on every criterion. However, a good trading platform must be user-friendly, guarantee the safety of clients’ capital, offer access to local and international markets, have reliable customer support, a demo account for practice, and charge reasonable fees.
Upon deliberation, IG stands out as the best trading platform in South Africa having satisfied most, if not all of the criteria. As said earlier, IG has stood the test of time having been launched in the early 70s. The commission fee of £8 might put off some people since some platforms do not charge fees for any trade. However, the flat rate fee reduces considerably to £3 if you have bought or sold shares more than three times in the previous month. IG offers CFDs and spreads betting facilities. Delivery and withdrawal of funds from your trading account incur no extra charge.
Even though you need a minimum deposit of £250 on your account and you are required to pay £12 per month after two years of inactivity, IG offers the best value for your money. IG has a very large share library. If you trade shares in the conventional form, you will have access to at least 10,000 reputable companies. IG also offers Contracts for Differences (CFDs) on stocks and a spread betting facility that covers more than thirteen thousand CFD stocks.
Best Stock Brokers in South Africa
As a beginner, the online stockbroker you choose would determine how good your trades are going to be in the stock market. If you intend to trade in foreign exchange, then you will be best served by choosing a Forex broker. If you want to trade cryptocurrency or CFDs on stock, you have to choose brokers that specialize in what you want to trade.Apart from specialization, you should also consider the fees charged by the broker. Does the broker charge an exorbitant amount? Is the broker regulated by the authorities? What is the kind of global reach you will get by using that broker? These are some of the questions you need to ask yourself in order to make a well-informed decision.
South African Trading Platforms
Trading platforms help to facilitate the buying and selling of products for profits. There are tons of trading platforms in South Africa and they all possess their unique features. Here are some of the best trading platforms in South Africa.
1, IQ Option
From a successful binary operations trading platform to an all-in-one trading platform, IQ option has witnessed a huge transformation since it was founded in 2013. It now offers a choice of 79 trading instruments in forex, commodities, cryptocurrencies, bond indices, binary options, and equities (stocks). Here are some of the trading platforms in South Africa.
Pros
- No withdrawal fees
- Free demo account
- IQ Option is user-friendly
- Excellent Customer support
- Islamic account is also available
- Low minimum deposit amount ($10)
Cons
- IQ Option South Africa does not support Meta Trader 4 or 5 (MT4/MT5).
- US traders are not allowed on the platform.
- Charges $31 for bank transfers
Verdict: Other than the fact that traders from the United States are exempted, IQ option ticks all the right boxes.
2. Binary.com
Binary.com allows you to trade Contracts for Differences (CFDs) and Forex via the Meta Trader 5 (MT5) platform. You can also trade stocks and cryptocurrencies. With a minimum deposit of $5, you can easily get started.
Pros
- Binary.com South Africa allows a minimum trade of $1
- Offers free demo account
- The platform is regulated to ensure the safety of clients’ capital
- It features an auto-trading robot that makes a trade based on favourable market conditions
- Only $5 is required as the minimum deposit
Cons
- Binary.com does not offer copy/social trading
- It does not support Islamic account
Verdict : This platform is suitable for the advanced trader and offers the greatest flexibility to the binary options broker.
3. Deriv.com
On this platform, you can trade binary options, Contracts for Differences (CFDs) and Forex. Deriv.com South Africa supports Meta Trader 5; a platform that offers amazing trading possibilities and tools for technical analysis.
Pros
- The minimum deposit on this platform is just $5
- It offers Auto Trading
- Offers Demo Account for learning
- Allows traders to trade using the Meta Trader 5
- You can deposit into your trading account using cryptocurrency.
Cons
- Deriv.com South Africa does not trade cryptocurrencies.
- No Islamic account
- The platform offers no bonus
Verdict
Deriv.com was created to replace Binary.com. It contains all the advantages present in Binary.com with an additional upgrade.
4. Olymp Trade
Since it was created in 2014, it has earned a reputation for making positive improvements to its platform each year. On Olymp Trade South Africa , you can trade cryptocurrencies, commodities, stocks, and ETFs.
Pros
- On Olymp Trade, you can trade for as low as $1
- Offers free demo account
- Has a wide reach globally
- It allows a minimum deposit of $10
Cons
- The platform does not support Meta Trader 4/5
- Olymp Trade does not offer Forex trading
- It offers no social/copy trading
Verdict: OlympTrade satisfies the needs of both the novice and the experienced traders. It has a great user-interface.
Frequently Asked Questions
- Do Share Trading Platforms charge fees to withdraw and deposit?
It depends on the trading platform. Some do not charge at all. Some platforms charge for either one of the two. However, some trading platforms charge for the two services.
- What is the Cheapest Share Trading Platform in South Africa?
eToro is widely considered the cheapest because it offers great value at little cost. It allows you to open a trading account free of charge, no commission for trading shares, no extra charge for deposit and it charges one of the smallest inactivity fees ($10).
- What is the difference between a flat commission and variable commission?
Flat commission never changes irrespective of how large or small the trade you make is. On the other hand, variable commission varies with respect to the size of the trade.
- What are share trading platforms?
These are the platforms that help in the buying and selling of shares to make a profit. The platforms offer the market analysis and the downside to any prospective trade before the client makes them.
- What are the things to consider when choosing a trading platform?
Commission charges, withdrawal/deposit fees, security and safety, minimum deposit, a demo account for practice, access to global markets, foreign exchange fees, performance, customer support, and others.
