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Daniel Saurenz
These online brokers convince in the highly competitive market
“Mobile First”: Actually all smart brokers rely on trading via mobile phone
© IMAGO/Westlight
Three years after the Corona boom among new brokers, the industry is about to be re-evaluated. Stock prices fell, but customer offerings improved
Interest is the price of money. This wisdom, which is quite ancient, caused the stock exchanges to drop significantly in 2022 and thus also clouded the activity of brokers. This is usually the case in bear markets, because despite all the warning signs, investors are mostly long i.e. be prepared for higher prices. However, bear markets are often accompanied by volatile phases and the ups and downs on the stock exchanges are increasing. As a result, the broker should be reliable and an evaluation of the last year shows that the old mistakes, like those from the Brexit times, are no longer there. This is good news for active investors.
The broker must deliver
Because not only the Corona crisis has shown that one thing is particularly important for investors: the reliability and offer of the broker. Feingold Research compared the top brokers in 2022, reviewed their websites and services, verified offers and trading, and took a close look throughout the year, especially on volatile trading days. School grades from 1 to 6 were assigned.
The selection of specialist brokers has grown significantly in recent years and investors in turn benefit from this competition. The brokers offer playful access to the stock market, ever better tools, modern apps and, above all, attractive conditions. In doing so, they keep an eye on active self-makers and stock savers. Savings interest didn’t play a role for long in 2022, even as ING and, towards the end of the year, DKB also tried to get new customers to their side with interest rates. Flatex, in turn, cut deposit fees before Christmas, all as a result of rising interest rates.
Who is fit for stormier times?
In 2022, stock markets experienced one of the weakest stock years in a long time. Even though many brokers do not have very low deposit or order fees, the bad mood on the stock market is affecting them. Investors have withdrawn and only those who, in the face of fierce competition, have brought as many new customers as possible to their platform in a short period of time now have the financial strength to survive more turbulent times with declining growth rates and margin pressure.
The Smartbroker won the Neobroker 2022 service check. The Berliners convince in almost all categories, twelve stock exchanges and electronic trading platforms are available in Germany, direct trading is also possible as with many competitors. Internationally, you can trade around the clock with links to 25 foreign exchanges such as Canada, Japan and Australia.
The product range is the widest of any neo-broker and ranges from stocks, bonds, ETFs, funds to warrants and certificates. There are a total of over 1400 investment funds eligible for savings plans and more than 700 ETFs, ETCs and equity savings plans. When it comes to the pricing structure, Berliners are quite aggressive. Zero euros for deposit management, four euros flat rate, with an order volume of more than 500 euros there are also no commissions if you go to the Gettex exchange in Munich.
Competition bites
It is not easy to set new accents in the fierce competition of neo-brokers. Traders can also enjoy free deposit management at Justtrade and the wikifolio community platform is offered exclusively. Justtrade has the largest range of direct certificate trading and connects the four issuers Citi, UBS, Vontobel and Société Générale. Unlike Smartbroker or Scalable Capital, however, there are no savings plans for stocks or ETFs.
For this, Justtrade offers cryptocurrency trading and therefore differs from all other neo-brokers. Although the offer is not as complete as with eToro, the five most popular digital coins are available with Bitcoin, Ethereum, Litecoin, Ripple and Bitcoin Cash.
When the cell phone becomes a must
Compared to the other new brokers, Scalable is one of the youngest providers in Germany with its launch in June 2020. However, the name should already be familiar to many, because Scalable has been a pure robo-advisor for a long time. Digital Asset Management was then expanded to include its own online brokerage business. In addition to gettex, Scalable also offers Xetra trading. On the other hand, Trade Republic has been a neo-broker from the beginning, so to speak, the dinosaur among neo-brokers. What should be taken for granted especially for young customers may surprise some older customers: a working mobile phone is mandatory. Because the app has a user-friendly interface and a modern design. But if you want to trade the classic way via a desktop, you won’t find a suitable solution.
You do not need this mandatory program with RoboMarkets. The broker is quite new on the market, but is particularly convincing for professional clients with an extremely competitive pricing model when trading the DAX, but also with currencies, stocks or commodities. With its competitors Flatex and etoro, the provider is showing what has obviously been important for years in addition to the product range and the pricing model: the media presence. In the brokerage industry, major providers continue to get it through sports. While ING is still known for its spots with Dirk Nowitzki, the last three are must-sees when watching the Champions League or Bundesliga. So competition stimulates business there as well.
