Many super well-known global mega corporations exist. Such as Apple, which is bigger than the country of Italy. Or even Alibaba, which made one teacher a billionaire.
But Europe is the home to slightly lesser-known stocks that come at a lower premium. Which is strange. For instance, in 2021, Europe’s biggest publicly-listed company, Louis Vuitton, had a bigger value than Nike, founded in America. As did Nestlé.
And Russia was sanctioned, but possesses a huge commodity pool.
Which means that powerful opportunities to invest in European stocks exist. These stocks are possibly underpriced. So in this guide, we’ll cover the top stock brokers in Europe, to gain access to these big EU markets.
Our Top Pick of European Stock Brokers (UK) 🏯
Considering investing in stocks? When assessing your Trading Data, be patient with your strategy. Take a breather and work from principles rather than fear. Just like Batman 🦇.
But let’s take a quick overview look at things to consider when investigating how to make money when going through an European stock broker:
- Stocks are versatile in terms of meeting various levels of risk appetites, but the most amount of dependability will demand more diversification of assets. That said, stock traders are able to make gains through two key pathways:
- Once you own a piece of stock (shares in that stock), you can make gains if the value of that stock rises during the time that you own it, as long as you sell it when it’s high enough.
- Dividends are another form of returns shareholders gain. Not every stock offers dividends, the firms who do normally pay every quarter.
1. eToro – Best European Stock Broker
If you haven’t heard of the Dark Knight of social Trading with an eerily similar logo to The Batman’s - eToro (review) - you must be living under a rock.
That’s considering the terrific number of sponsorship and ad deals globally that they feature in, including personalities, celebs, and pro sports teams, which has ramped up the international awareness for this brand.
That doesn’t mean this tool isn’t for the everyday person… A central reason behind eToro’s growth is its social community numbered in the millions who all share knowledge and ideas, and the CopyTrade ability allows you to mirror the moves of top investors on the platform with proven track records.
A second reason to use this service is its security. The dangers of bad actors acting on the platform is minimised because eToro makes it harder for these malicious people to use the platform due to them needing account verification first, which is also called know your customer (or KYC for short) – before any use is possible, including we think participating in communities, or doing trading.
When you add their two-factor authentication and minimums for accounts, this means eToro is a harder target. While being a top passive passive stock trading tool. Bad parties usually target free and anonymous platforms. Indeed, the British government attacking end-to-end encryption for Brits has a slight point, we have to admit. But eToro’s solution is much better - simply making its social platform require authentication while still allowing strong encryptions. And for the actual number of assets, you get an immense number of opportunities.
Because eToro is so widely accredited and connected, there is a powerful global infrastructure, which grants you access to more than 2,700 stocks with no commission, covering all industries, and located in major cities from Hong Kong to London – using fractional shares, to let you diversity your portfolio using brands have varying sizes and locations, without putting caps on trading sizes. You can create an account quickly. It’s the hero we need but don’t deserve?
2. Plus500 – Best European Stock Broker for CFDs
Plus500 is a specialist stock broker for Europeans seeking to trade with contracts for differences, giving you the ability to speculate on moving prices for stock assets rather than directly buying underlying shares in these stocks.
The benefits of CFDs are multifold: for example, you can get returns on stock assets whatever direction it moves in, and leverage can often be applied, letting you exaggerate profits.
But the key risks include that most CFD traders lose; in addition, leverage goes both ways and can increase losses – it’s advisable that any casual CFD traders make sure Plus500’s ‘Negative Balance Protection’ (NBP) feature is turned on.
NBP came about as a crucial hedging feature in 2018, following ESMA regulations, made to safeguard retail investors, removing the possibility of reducing the chances that you’ll lose more cash than your account has. By comparison, stop losses are not as reliable and can drop past the pace of the market and cause positions to remain open beyond the mark-off point. Meanwhile guaranteed stop-losses cost extra. So if there is large volatility in the market, swinging your positions into the negative, your losses should stay inside of your initial deposit via NBP.
Finally, Plus500 is fully licensed by the FCA, which rounds this off as a leading stock broker for Europeans. Many of their offerings are free. Discover 70+ forex contracts for differences. But be reminded that they are directly linked to the London Stock Exchange (LSE), allowing you to start your starting position from a European asset stance and be exposed to lots of EU assets.
3. AvaTrade – Best European Stock Broker for Custom Orders
AvaTrade is a massive step up - we’ve put this in the number two spot in case you’re the kind of trader who takes more time to master the small things.
These guys are very useful at a time when currencies are being devalued, and people are looking for ways to get good deals - will the Russian Ruble win out over the American Dollar? What commodities should traders be buying… If this is you, proceed.
So we can think of this app as the serious trading version of eToro. Although automations exist, these need a fair amount of technical know-how to use skilfully.
AvaTrade focuses on helping traders to custom-make positions like a tailor, so that they can negotiate special deals and personalise communications to individual buyers and sellers. This capability isn’t always given by trading apps, so offers the discerning trader more versatility – with time, you’ll open up unique trading channels.
As for the firm, they were founded in Ireland, and are regulated by its central bank. But also have branches globally and thus are good for traders seeking the best stock brokers with European market access for EU and other currencies – connections include Russia (AvaTrade allows you to purchase Russian Rubles [RUB]), AU, South Africa, British Virgin Isles, and Japan.
You’ll get more than stocks, including bonds, indexes, ETFs, commodities, and more. There are a lot of interesting integrations via third-party extensions you can use, such as MetaTrader 4 or the native AvaTrade platform – these all function on mobile (iOS & Android). But keep in mind that many of these are more better suited to discerning traders, and that includes negotiation abilities.
4. Interactive Investor – Best European Stock Broker for Discount Stocks
Interactive Investor was founded in 1995 – starting as a communication network for traders, but it’s grown into a leading stock broker for Europeans.
They’ve provided services for more than 300,000 investors in this time. Traders use them when they need a fixed-fee stock broker, so that they can have better transparency of trading expenses. This costs about £10 a month allowing more than one account, and each plan offers at least one no-commission trade a month.
The platform is execution-only: and you get lots of value for this, with an emphasis on simple, open fees, profit-to-expense ratios, smart capabilities, and competitive rates. For example, there’s no costs for exchanging between accounts, registering, or account exits.
As for security, Interactive Investor has been around for over 20 years in the industry. They’re licensed by the FCA. Customer data is handled and stored electronically, also offering insurance under Financial Services Compensation Scheme (FSCS) provisions. Cash amounts are insured up to FSCS caps, and funds are segregated from company funds.
Which means Interactive Investor can’t dip into your money. Furthermore, all digital transactions get encrypted and stored to robust standards to keep accuracy. And their level of support is high, which explains how hard it is to discover a leading stock broker for Europeans that has as strong a level of positive user ratings as this firm.
5. Hargreaves Lansdown – Best European Stock Broker for Savings and Investments
This renowned stock broker for Europeans has been around since 1981, but probably best suits those looking for professional investment support, if they themselves aren’t pros.
The platform offers teams of investment experts with a client base of over 1.2 million, and this broker has handled nearly £100B in savings & investments for these members who trust the broker to work their wealth long-term no matter how the wider market moves, or if there is war on the horizon between major nations.
This broker is so massive that they boast a listing on the Financial Times Stock Exchange 100 (FTSE 100) itself, as one of the 100 biggest European firms.
So it’s pretty clear that they are highly established and have strong trust in the industry, with every key regulation applied to protect and insure your data and account funds, and ensure strong professional due diligence. Furthermore, their mission statement focuses on simplifying the financial dealings of their members so that it's less complicated to invest streams for pension, saving, and investment aims – with access to accounts online.
This hub gives you access to a prodigious scoop of investment opportunities, which includes thousands of top index funds, investor trusts, ETFs, and US & Canada, UK and European stocks. And regardless of its size, Hargreaves Lansdown remains one of the most practical leading stock brokers for Europeans.
To summarise: this is a great value, good access, and popular stock brokers for Europeans providing lots of funds, bonds, and EU and foreign stocks.
Best European Stock Broker – Buying Guide 📊
We’ve covered some of the best stock brokers for Europeans. But what exactly are stocks? Let’s investigate a bit more about how stocks work and how they are traded on the various platforms.
What Are Stocks?
When you directly buy stocks in a company, you become a stockholder and can therefore get a portion of that company’s gains, including limited insurance against bankruptcy.
Shareholders and stockholders are interchangeable terms. And “stock” described the actual asset although sometimes this is sometimes interchangeable with “shares.”
Most pro investors deal with the handling of stocks in one way or the other, either buying and selling stocks themselves, advising, or issuing stocks. Let’s delve deeper into that point:
Stock Issuing - The Reason for Firms Offering Stocks
The stock market is composed of many different exchanges where traders and investors can swap specific shares for companies. But what is the purpose for these shares and stocks?
A company will issue stocks when they need to increase the amount of capital for growing their firm operations or to expand into new ventures.
When stocks are sold, investors are allowed to have some ownership in the company. Early investors in the firm can take advantage of this later on as the firm increases in returns and their owning grow in its market worth.
“Equity” is frequently used to describe ownership, whereas “equities” refer to assets like stocks. (Bonds are also issued in order to raise capital, but buying these makes traders creditors, who don’t have ownership claims.)
If stocks are bought in a firm, the person is eligible for certain rights depending on type of shares that are owned, including the following:
- 📛 Voting claims: Stockholders can participate in votes during annual meetings.
- 📛 Dividends: Offer a piece of the revenue every so often in the year.
- 📛 Capital gains: Which is the most common way people invest in stocks; if a firm grows in worth, your shares also grow (or vice versa: if the stock loses value so do your shares).
Being a stockholder doesn’t mean you can direct business operations. And actually changing annual board meeting outcomes is unlikely or very limited. Owning shares overall signals that you have trust in the company.
Initial Public Offerings (IPO) Explained
Let’s review how an initial public offering (IPO) works. To begin with, this happens when a privately owned (limited) company goes public by offering shares for stock in its company to the general public.
When you hear the saying, “going public,” this refers to the firm going through an IPO that allows shares to become available to buy on the main investor stock market.
The initial public offering will involve the firm announcing how many shares in stocks will be issued and the IPO markup. Profits generated from this public sale goes directly to the company’s vault. After the IPO has been completed, shares are released in real-time to the secondary market – which we refer to as “the stock-market” – and share prices no longer have a fixed markup; instead they vary according to market demands and other forces.
Market capitalisation is shortened to “market cap,” which measures a firm’s sum market value – this figure is measured in cash-proven market support.
This is extractable from the stock exchange. A firm’s market cap is the sum value of each share of that firm’s stock that is owned by its shareholders. For example, a corporation with 20 million shares, valued at £50 per share, has a total market cap of a billion pounds.
Market capitalisation is a central financial concept that lets investors compare firms, based on sum revenue. It’s a key measure of a firm’s size on the marketplace: current supply-and-demand forces and performance – and it’s a hard-cash figure: this is what people will actually put up to back that company.
- 🏯 Large-cap corps – these are typically seen as firms with market worth of over £7 billion. Firms are typically blue-chip, featuring solid standings, lots of goods and popular services, stable growth, and a long record of good dividends. You see a lot of industry-leaders in this grouping, with household brand-names that people love nationally and even worldwide. Which means, large cap stock investments are usually reliable stocks, with lower volatility and decent gains potential, and more robustness compared to small or large-cap stocks.
- 🏰 Mid-cap firms – commonly somewhere between 1 and 8 billion pounds in size. You’ll find more gains potential than in large-cap corps. Firms found at this level are well-established, but can face more industry-competition and are expanding more depending on the market and industry conditions.
- Small-cap companies – usually over 200 million and under 1 billion pounds in size. Firms found at this size are younger and less established. This includes niche sectors or emerging markets. This size of business typically has the most exaggerated gains potential and the biggest risk of the three markets. But because there is lesser supply-and-demand, smaller firms are less robust to business busts. There is more volatility, as competition is harsher. Emerging industries can also see more unknown factors. But the most substantial gains upside potential is here, for long position holders who have a big enough risk appetite to sharp market downturns in the short-term.
Stocks vs. Bonds
Companies release stocks and shares so they can raise funds for expanding their company or seeking new ventures. But what investors get significantly differs depending on whether shares in firm stocks are bought immediately -- once it is released in an IPO -- or if shares were purchased via a shareholder (on the secondary public market). Either way, they issue stocks to get more investor cash.
By comparison, bonds work differently. To begin with, bondholders are creditors not partial owners of the firm; getting rewards such as interest and principal-repayments. Creditors also get better legal rights vs shareholders in the event of bankruptcy and get refunded before shareholders if a company liquidates its ownings to repay debts.
Shareholders, however, find themselves the last to be reimbursed, or not at all, if a firm gets busted. Which in this way of thinking makes shares riskier compared to bonds. Although stockholders do get dividends and other part-ownership rewards, such as voting in annual board-meetings.
How Do Stocks & Shares Work?
Professional investors do stock issuing for a firm, with the aim of growing funds for expanding their business. Stockholders can possess a piece of the firm and, depending on the kind of shares purchased, have claims to some of this revenue and assets.
The degree of ownership that a stockholder receives depends on how many shares are held in the firm’s stock. For example, if a firm releases 20,000 shares of stock outstanding and one person possesses 2,000 shares, this gives them a claim of 10% to the firm’s revenue and assets. Elon Musk possessed 9.8% ownership claims to Twitter before he purchased it outright.
What Are the Types of Stocks?
There are two main groupings for stocks: common and preferred. Common stockholders are allowed to get cash-dividends and can vote in annual shareholder meetings, whereas preferred holders have limited voting rights, or none. By comparison, preferred shareholders also get cash-dividends and often get bigger payouts, with a bigger claim to assets than common shareholders do, in the case that it goes through bankruptcy.
How Can You Buy Stocks?
Normally, stocks are bought and sold via stock exchanges, for instance the FTSE 100 or London Stock Exchange (LSE). These are opened to the public once a firm “goes public,” so that its assets can be traded outright. Most frequently, traders and investors buy via broker accounts through exchanges, which show the buying/bidding price and selling/asking/offer prices. Share costs are determined by market factors.