How to "validate" online stock trading platforms?
I don't consider myself an investor, mainly as I don't have sufficient disposable income to invest. However over the years I've accumulated a number of share certificates for various public companies. All of these companies are still trading. Most certificates are for small amounts (e.g. 30 shares of low-value stock), others are for larger amounts (several thousand shares each).
Recently I started looking for an online brokerage to deposit these certificate shares - so that I could sell them when the time is right. I am looking for a cheap trading platform, with online access - which is specifically cheap for low-volume trades (e.g. I may end up doing one trade a year). I want to avoid paying maintenance and only pay for trade execution.
Searching online produces some results that seem dodgy, scammy or otherwise not worthy my attention, while some results seem genuine. Considering I am in the UK, how do I validate that an online-only trading platform is genuine and not a scam?
Please note, that I am not asking for recommendations but rather how to validate specific references I already have.
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The regulatory authorities in the UK are the Financial Conduct Authority and the Prudential Regulation Authority of the Bank of England. Contact them to “validate online stock trading platforms".
Then contact the brokers to see who has the features you seek:
Lowest commissions
No minimum account size
No account maintenance fees
No data fees
No odd lot fees (less than 100 shares)
If the brokers are listed in Monevator's "UK’s cheapest online brokers" list then I'd be quite confident they're not scammy or dodgy. (My guess is it's one of the "Share dealing brokers" in the third table on that page is going to be what you're looking for, but watch out for "inactivity fees".)
For a second opinion and some other options, take a look at The Lang Cat's guides (registration required). For example the 2018 "Come and have a go" document lists 21 Do-It-Yourself share dealing platforms.
It's not impossible there are smaller but quite legitimate "boutique" operators who aren't covered by those lists, but I doubt they'll ever be as cheap as the big names due to the economies of scale which come with size.
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