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Freetrade Review - Is Freetrade Plus worth it?

The Dividend Experiment

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Is Freetrade plus worth it?​

TL;DR - - - I think if you were dead set on using an ISA with Freetrade and paying for that anyway (and that is a very reasonable option for an ISA with a low-cost broker) then its definitely worth it as it gives you access to all the stocks that they have on offer for an ISA and the very generous 3% interest rate makes the pricing reasonable. If you already have an ISA elsewhere then I think it's not quite worth it at the moment and would like to see extra features coming in the pipeline.




Let's look at the popular investing app Freetrade which uses a ‘freemium’ model to allow for commission-free trades. I will also be following the standard format of these tech reviews which will be:

  • A general description of the platform
  • How it works
  • Who it’s for
  • What I think of it – is it worth getting?
We will also address the premium version of the platform Freetrade Plus. Full disclosure – Freetrade gave me a year’s worth of Freetrade Plus at a heavily discounted price but not in exchange for this review. Probably by the end of the review, it will be fairly obvious that they didn’t pay me or incentivize me to make this review but watch on to see what I think!

Oh and one last thing before we get started, most of you who have been following the channel for a while have probably signed up to Freetrade and gotten the free share already but just in case you haven’t – my referral link is in the referral link subforum. If you want to post links for others to sign up then you can also add yours to that thread and you each get a free share. I have even done an overview of the predicted value of each share too if you want to check that video out

My general understanding of the history of these zero commission brokers is that it started in the US with Robinhood which was marketed at younger users and potential first-time investors. Focusing on function and usability on an app that people can use on their phone was one way to differentiate these new low commission brokers from legacy brands that are aimed at an older audience.

Freetrade has done this very well, it is incredibly simple to buy and sell a limited range of stocks from a range of stock markets around the world. Personally, I like the user interface and the functionality runs smoothly and is kept very simple.

If you get the free version there is still a wide range of stocks and trusts.

what can I invest in.jpg

To me, the general downsides of this broker are firstly the fact that it does not currently offer any kind of desktop version of your investment portfolio. This is a huge security risk as I don’t trust my phone, as much as I would trust my laptop and I prefer the idea of being able to view the portfolio on multiple screens. Perhaps this is an outdated perspective though as many people in the target audience actually much prefer their phones. I have also seen them say as a reply to a comment on the Freetrade Instagram that it's in the works.

Another general disadvantage is that the load times can occasionally be quite slow, or at least in my experience. That goes double if you are using a VPN. This also means that the messages from customer service don’t show up due to the way that the app displays them which is quite annoying.

How does Freetrade work as an investment app?

Freetrade is a very simple way to buy and sell stocks, trusts and funds as mentioned previously. Along the bottom of the app there are 5 user options of things that you can do:

185242006_499403931109934_542293136975157600_n (1).jpg

The first one with the £ sign inside the house is the home screen and also shows your portfolio and how that’s doing right now. It has a neat graph that shows your general progress and you can select the time period you want to display.

The second one which looks like a pie chart is insights which will show you some tools that will help you to make better informed investing choices.

The third option on the footer bar is 'discover' and this is where you can search for other companies that you might want to buy. You can search by the name of the company or the type of investment so that is pretty useful. If you want to add something then it’s also possible to vote for stocks that will be added to the platform in the future so that’s pretty cool that they allow for this kind of community contribution.

The fourth option is the activity tab which just shows you all your buys and sells, importantly for us it also shows dividend payments. If you have Freetrade Plus it will show you the interest you have accrued. It also shows you your deposits and withdrawals.

Talking of withdrawals – these have been completely painless and super easy. I am also impressed with the speed at which they reach my bank account.

The final option on the menu is the account this will show you your types of accounts that you hold and general admin information. This is also the tab where you would deposit or withdraw money if you want to change the balance on your account.

The app itself does this concept of user-friendly and keeping it simple really well, possibly the most user-friendly one on the platform.

I haven’t used customer service extensively but it was acceptable, not a rapid response but it answered the queries in a reasonable timeframe and I haven’t had any major problems with the platform itself.

So who is Freetrade designed for?


In my opinion, Freetrade markets itself toward younger and newer investors and that is evident in its simplistic design, features and marketing that is designed to explain the concepts of investing. It is also clear that they are aiming at a younger audience through the language in their marketing.

In that regard, I think that the app is a really good fit for beginner investors. Despite the marketing newer investors necessarily younger invests but the app is a really good way to transition into the world of buying and even trading investment types be they stocks, funds or investment trusts.

When you start to grow your portfolio to really significant levels then some features that you might want are just not available with out moving onto the premium platform and then even after that you may end up paying on top of that.

For example, if you wanted to open a SIPP Self invested personal pension then it would cost you an extra £7 a month on top of your Plus membership or £9.99 if you didn’t have Freetrade plus.


Is Freetrade a good app and is Freetrade PLUS worth getting?


The first part of the question is fairly easy to answer. The threshold for opening and maintaining the general investment account is very low and you even get a free share if you are referred to the platform.

I am not using Freetrade as my main investing platform but I will absolutely be keeping the account as I think it is very useful to quickly lookup a company and buy some shares if that’s what you needed to do. Overall the general investment account lacks a number of features that are now behind a paywall but as a standalone brokerage app with no fees for maintenance, ease of use and flexibility in its holdings I believe that it is well worth opening and having an account with Freetrade even if you already have the main account.

The second part of the question regarding whether Freetrade plus is worth the money is a little harder to answer as it depends on a number of factors.

So, Is Freetrade plus worth the money?​

I think if you were dead set on using an ISA with Freetrade and paying for that anyway and that is a very reasonable option for an ISA with a low-cost broker then its definitely worth it as it gives you access to all the stocks that they have on offer for an ISA as well as the very generous 3% interest rate which makes the pricing reasonable. If you already have an ISA elsewhere then I think it's not quite worth it at the moment and would like to see extra features coming in the pipeline.

These of course are just my opinions on the broker so if you want to share your thoughts or even tell me where I am wrong then you are very welcome to comment below

These of course are just my opinions on the broker so if you want to share your thoughts or even tell me where I am wrong then you are very welcome to comment below!
 
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23rdian

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A great review. I personally like FreeTrade although I am using them as a backup when I have no trading credit left on my main broker. Ideally I would like to move my ISA to them but I have some reservations. Apologies if you have already addressed these.

1) Do you actually own the shares etc. Would you be happy holding £85k+ with them They seem very (in fact, almost too quick) to process trades? Are these being purchased in the normal way?

2) The lack of more obscure stuff, can I do those little known international trades I can at the moment?
 

The Dividend Experiment

Administrator
Staff member
Moderator
Feb 23, 2021
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A great review. I personally like FreeTrade although I am using them as a backup when I have no trading credit left on my main broker. Ideally I would like to move my ISA to them but I have some reservations. Apologies if you have already addressed these.

1) Do you actually own the shares etc. Would you be happy holding £85k+ with them They seem very (in fact, almost too quick) to process trades? Are these being purchased in the normal way?

2) The lack of more obscure stuff, can I do those little known international trades I can at the moment?
1) As far as I know you own them although the way they process may be some convoluted way where you own them in name only or something more complicated for me to comprehend haha. I wouldn't feel comfortable with that much money until they bring out a desktop/browser version of their platform.

2) With plus the range is pretty decent but the free version its unlikely that many obscure trades would be available