How to Trade Stocks in Ireland – A Beginner’s Guide to Trading Stocks
Trading stocks in Ireland has never been easier. With the technology we have at our fingertips today, you can trade stocks with the click of a button, providing many people with the ability to create another revenue stream on top of their job. However, the financial markets can potentially be hazardous – so it’s vital to understand them before diving in.
In this guide, we’ll discuss How to Trade Stocks Ireland in detail. We’ll cover all of the stock market elements that you need to know before highlighting the best stock brokers in Ireland today – enabling you to trade commission-free!
#1 Stock Broker in Ireland – eToro
How to Trade Stocks Ireland – Quick Guide for 2021
If you’re ready to buy stocks right away, we’d recommend using eToro over other providers, as they offer commission-free trading on thousands of stocks and only require a $50 (€43) minimum deposit. By following the four steps below, you’ll be able to sign up and begin trading with eToro – all in less than ten minutes!
- Step 1 – Open an eToro Account: Navigate to eToro’s homepage and click ‘Join Now’. Provide a valid email address and choose a username and a password.
- Step 2 – Verify your Account: Upload proof of ID (copy of passport or driver’s license) and proof of address (copy of bank statement or utility bill) to verify the account.
- Step 3 – Make a Deposit: Deposit a minimum of $50 (€43) via credit/debit card, bank transfer, or e-wallet.
- Step 4 – Trade Stocks: Search for your chosen stock and click ‘Trade’. Enter your position size in the order box and click ‘Open Trade’.
How to Trade Stocks Ireland – Complete Tutorial 2021
The section above has highlighted how to invest in stocks in Ireland with eToro. However, if you are a beginner trader, you will likely require a more thorough explanation of the trading process. With that in mind, this section details how to trade stocks Ireland in five simple steps, ensuring you have the information you need to invest effectively.
Step 1 – Create an eToro Account
Head over to eToro’s homepage and click the ‘Join Now’ button. You’ll then be prompted to provide a valid email address and choose a username and a password for your account. Alternatively, you can complete this process on eToro’s handy mobile app, available on iOS or Android.
67% of retail investor accounts lose money when trading CFDs with this provider.
Step 2 – Verify your Identity
As eToro is one of the safest FCA brokers UK, you’ll need to verify your account before trading. To do so, click the ‘Complete Profile’ button on your dashboard and provide the required information for the KYC checks. You’ll also have to upload proof of ID (a copy of your passport or driver’s license) and proof of address (a copy of a bank statement or utility bill).
Step 3 – Fund your Account
New eToro users must deposit a minimum of $50 (€43) before being able to trade. This deposit is free if made in USD; however, there will be a 0.5% currency conversion fee if made in EUR or any other currency. At present, eToro accepts the following payment methods for Irish clients:
- Credit card
- Debit card
- Bank transfer
- Rapid Transfer
Step 4 – Search for your Chosen Stock
Click into the search bar at the top of the screen and type in the name or ticker symbol of the company you’d like to invest in. For the purposes of this guide, we’ll be looking to invest in Amazon. Once the company appears, click ‘Trade’.
Step 5 – Trade Stocks
An order box will now appear, much like the one below. In this box, enter your desired position size (minimum of $50), double-check that everything is correct, and click ‘Open Trade’.
And that’s all! You’ve officially started trading stocks in Ireland with eToro – completely commission-free!
How to Trade Stocks in Ireland – Beginners Guide
If you are a complete newcomer to the financial markets, you must understand what stock trading is and how it can benefit you. With that in mind, let’s discuss some of the fundamentals of the stock market:
What is a stock?
Firstly, what is a stock? A stock (sometimes called a share or equity) represents a portion of ownership in a company. For example, if a company had 100 stocks and you owned 10 of them, you’d have a 10% stake in the company. Companies will issue stocks to raise capital, which they can then use to expand their business operations. Retail and professional traders will then purchase these stocks and hold them, hoping that the price will rise.
Stocks are mainly traded on stock exchanges, where buyers and sellers come together to trade them. The main reason people invest in stocks is to benefit from the price of the stock rising – which means you can make a profit on your investment. However, there are also other benefits of owning stocks, such as dividend payments and voting rights.
What are the benefits of investing in stocks?
So, what are the benefits when you buy stocks in Ireland? Well, as we’ve touched on above, the main advantage is that you have the potential to generate a return on your investment. If you purchased a stock valued at $50 and then sold it when the price rose to $100, you’d have made a 100% return on your money! The great thing with buying stocks is that you can generate returns that are far higher than you’d get with other asset classes – yet there is also an added element of risk.
Another benefit of investing in stocks is dividends. Certain companies will opt to reward shareholders by distributing a portion of their profits as cash payments. This will depend on the company (and only applies to profitable companies), but it can provide a passive income stream on top of the potential for capital gains. Finally, owning shares gives you voting rights, which applies to shareholders meetings. However, this will only really be a concern if you own a significant stake in the company.
How can you make money by trading stocks?
To make money when you invest in stocks UK, you’ll need to take either a ‘long’ and a ‘short’ position. Going long is when you buy a stock in the hope that the price will rise, whilst going short is when you sell shares in the hope that the price will fall. Both options provide an avenue to generate a return – although short selling is much riskier as the losses are potentially infinite.
If you did make a profit on a stock trade, you’d need to pay capital gains, which is currently 33% of the profit in Ireland. So, if you made €1000 profit on a stock trade, you’d need to pay €333 as tax. Dividend payments are also taxable in Ireland, although this is usually lower than the capital gains tax.
Best Ways to Trade Stocks Ireland
If you’re considering the best shares to buy now, it’s also essential to consider how you will begin investing. Luckily there are multiple strategies that you can employ to gain exposure to the stock market. Let’s take a look at three of the main ones and their benefits for traders:
Buy Individual Stocks
One of the most popular ways to trade stocks in Ireland is to buy individual stocks. This is as simple as it sounds – research a company that you believe will do well in the future and then invest in its shares! However, a lot goes into determining whether a company will do well, including technical analysis, fundamental research, and consideration of market news.
You could also purchase a selection of individual stocks and build your own portfolio. This is safer than buying and holding one or two stocks, as portfolios benefit from diversification. Diversification is when a selection of stocks with different correlations help to ‘balance’ out any negative returns. For example, if one stock in the portfolio went down, there’s a chance that another went up. Overall, utilising a diversified portfolio of equities is one of the best ways to trade stocks in Ireland.
Invest in an Index Fund or ETF
Another option you have is to place your capital into an index fund or an Exchange-Traded Fund (ETF). These assets tend to comprise the best companies to invest in and bundle them together into a single investment. As such, you’re able to instantly gain exposure to numerous companies – without having to construct your own portfolio.
Index funds and ETFs tend to be passively managed, meaning they either track a stock market index (like the FTSE 100) or contain a selection of stocks that they hold long term. Due to this, investing in an index fund or ETF is typically very cheap whilst still offering a way to generate notable returns. There are hundreds of ETFs to choose from, focusing on industries, geographical locations, and company size, so it’s wise to do your research before investing.
Finally, you could even utilise a copy trading approach to your trading. Copy-trading allows you to automatically copy the trades placed by other traders – thereby automating your trading. Some brokers (such as eToro) offer this feature within their trading platform, which is ideal for beginners who wish to still generate a return whilst learning the market.
Alternatively, you could also invest in another eToro feature called ‘CopyPortfolios’. These are professionally managed funds that you do not need to pay a management fee for! This is in stark contrast to other managed funds that charge excessive fees. Thus, investors can gain exposure to a wide variety of assets cost-effectively.
Are Stocks a Good Investment?
So, now that you know what trading stocks in Ireland entails, can they be considered a good investment? The answer to that is yes! Stocks are commonly referred to as one of the best investments UK as you can begin online trading from the comfort of your own home and do not need a large amount of money to begin. In fact, brokers such as eToro allow you to invest from as little as $50 (€43), which provides ample capital to start trading.
Right now, we live in an extremely low-return environment, meaning that people worldwide are searching for a way to generate a more significant return than they’d get from banks. Stocks can provide this (and more) if you are savvy about it. Although there is a much higher risk level when investing in equities than other asset classes such as bonds, there are also much higher rewards to be made!
What Make Apple and Amazon such Good Investments?
People tend to invest in Apple and Amazon due to their solid and stable characteristics. The companies that perform well in the stock market consistently display revenue and profit growth, highlighting that the business model is working. In the case of Apple and Amazon, these are two of the strongest companies in the world right now, and this is evidenced by the amount their share price has increased in recent years. Due to their profitable business model and in-demand products/services, many people purchase shares of these companies hoping that the share price will continue to rise.
Stock Trading in Ireland – What are the Risks?
Until this point, the process of trading stocks in Ireland has probably seemed pretty rosy! However, it’s crucial to have a balanced conversation and mention the risks involved with trading. Found below are some of the main threats to be aware of when stock trading in Ireland:
- Risk of Financial Loss – The main risk to be aware of when you buy shares UK is the risk of financial loss. This refers to any situation where you buy a stock, and then the price falls below the price you purchased at. Ultimately, if you were to sell the stock, you’d make a loss on that trade. This is why it’s so important to do your research before investing in equities.
- Slippage – Another risk to be aware of is slippage. Although not as much of a concern as financial loss, slippage occurs when you place a trade and the price it is executed at is not the same as the one you requested. For example, you may place a buy order at $100, but the broker can only execute it at $110. This only happens during volatile markets (e.g. during significant news events) but can seriously hamper profitability.
- Inflation – Finally, inflation is another risk factor when stock trading. This risk relates more to the companies you invest in, as higher inflation correlates with reduced earnings growth expectations. IF earnings were to grow at a slower rate (or not at all), this usually results in bearish movements in the share price.
Tips To Follow when Stock Trading in Ireland
If you’re looking to invest $5000 (or any other amount), there are specific tips to keep in mind that can optimise your time in the stock market. Found below are three of our main pieces of advice when trading stocks in Ireland:
Tip #1 – Do Your Research
Researching stocks beforehand can help you avoid losses and make returns. As we noted earlier, the best companies display consistent earnings growth and offer an in-demand product or service. You can even dig deeper into a company’s prospects by analysing factors such as the company’s EPS, P/E ratio, or free cash flow.
Tip #2 – Diversify
As noted by HSBC, diversification is important because it lowers your overall risk and provides more opportunities to realise gains. Diversification is the opposite of ‘putting all your eggs in one basket’ and ensures that you are making the highest returns for the lowest levels of risk. Furthermore, diversification can allow you to gain exposure to countries and industries that you otherwise never would.
Tip #3 – Choose a Good Trading Platform
Our third tip is to make sure that you choose a trading platform that suits you. The best trading platforms will allow you to trade cost-effectively on a vast range of assets. Furthermore, many platforms allow you to fund your trading account using PayPal and other e-wallets – making the entire process much more streamlined!
Where to Trade Stocks in Ireland – Top Brokers Reviewed
The final section of this guide on how to trade stocks in Ireland will focus on the various brokers that you can choose from. These days, there is an abundance of trading platforms supporting Irish clients and offering services within the stock market. Due to the number of options, narrowing them down to one that suits you best can be tricky.
Not to worry – we’ve done the research and testing and selected three of the best brokers for Irish traders. Read on to learn more about each of these brokers and the advantages they can offer.
1. eToro – Overall Best Broker to Trade Stocks in Ireland
Taking the top spot in our list of best Irish brokers is eToro. You may have heard of eToro before, as they are one of the most well-respected brokers in the industry. eToro has more than 23 million users worldwide and is regulated by top organisations, including the Financial Conduct Authority (FCA), ASIC, and CySEC. As these companies regulate eToro, the trading platform is considered incredibly safe for traders.
We recommend eToro for Irish stock traders as you will be able to invest in real stocks or stock CFDs without having to pay any commissions. Real stocks will have no fees attached whatsoever, whilst stock CFDs will require that you pay a small spread. In terms of asset selection, eToro has 2000 different stocks to trade, ensuring you’re always able to find an investment opportunity.
The minimum deposit at eToro is only $50 (€43) and can be made via credit/debit card, bank transfer, or e-wallets such as PayPal, Skrill, and Neteller. There is no deposit fee, although if you deposit in a non-USD currency, you’ll have to pay a small currency conversion fee. Credit/debit card and e-wallet deposits tend to arrive instantly, whilst bank transfers can take a few days.
Finally, eToro offers users access to their handy CopyTrader feature. This feature allows users to automatically copy the trades placed by other eToro users – with many of these users consistently making double-digit returns. This feature is incredibly valuable, especially to beginners looking to make consistent returns!
- Commission-free broker
- Tight spreads
- CopyTrader and CopyPortfolio features
- Accepts PayPal
- Thousands of stocks to choose from
- Heavily regulated
- Small inactivity fee
- Minor currency conversion fee
67% of retail investor accounts lose money when trading CFDs with this provider.
2. Capital.com – Best Broker to Trade Stocks in Ireland with 0% Commissions
A great alternative to eToro is Capital.com. Capital.com has grown since 2016 to become one of the best brokers in Europe and is regulated by the FCA, ASIC, CySEC, and MiFiD. Although Capital.com is primarily a CFD broker, it does offer actual stock trading too.
Capital.com offers commission-free trading on 3600 different stock CFDs and 23 stock index CFDs. Thus, you’ll never be short of investment options when trading with Capital.com. If you’d like to invest in other financial instruments, the platform also offers 138 currency pairs to trade, along with ETFs, commodities, and cryptos.
Another reason Capital.com is one of the best CFD brokers is that the minimum deposit amount is only $20 (€17.30). Deposits are free to make and can be completed via credit/debit card, bank transfer, and various e-wallets. Notably, Capital.com doesn’t charge any withdrawal fees or inactivity fees, making them one of the cheapest brokers to trade with.
Finally, Capital.com is well-respected due to the number of educational resources provided for traders. Capital.com offers videos, tutorials, webinars, articles, and trading courses along with a free demo account. They even provide market updates so that you are kept in the loop with the latest goings-on!
- Commission-free broker
- Regulated by several top entities
- Minimum deposit only €20
- Massive library of educational materials
- Vast selection of stocks to trade
- Mainly focuses on CFDs
- A limited selection of ETFs
67% of all retail investor accounts lose money when trading CFDs with this provider.
3. AvaTrade – Best Broker to Trade Stocks in Ireland with Leverage
Another great option if you are looking to trade stocks in Ireland is AvaTrade. AvaTrade is directly regulated by the Central Bank of Ireland, meaning that Irish traders are offered regulatory oversight within their home country. Furthermore, AvaTrade has over 200,000 clients and handles over £60bn of trading volume per month, which adds to the broker’s credibility.
We recommend AvaTrade as one of the best stock brokers in Ireland, as you can trade over 600 stock CFDs and over 30 different stock indices. However, as AvaTrade is mainly a forex broker, this asset selection is a little lower than you’d get with other trading platforms. Like eToro and Capital.com, AvaTrade is a commission-free broker and only charges a competitive spread on CFDs.
The minimum deposit at AvaTrade is €100, with the online brokerage accepting EUR as a base currency. This means that users in Ireland do not have to pay any currency conversion fees when using AvaTrade. AvaTrade accepts credit/debit cards, bank transfers, and e-wallets (such as Neteller, Skrill, and Klarna), with all of these methods being free to use.
Finally, AvaTrade offers full support for MT4 and MT5. Although it will only be applicable if you are forex trading, it is still handy if you want to branch out into other assets. You can even use AvaTrade’s ‘AvaOptions’ trading app, which allows you to trade options in real-time on various top assets!
- Regulated by the Central Bank of Ireland
- Offers options trading
- Accepts EUR deposits
- MT4 and MT5 support
- Commission-free trading
- Doesn’t offer real stock trading
- Doesn’t accept PayPal
67% of all retail investor accounts lose money when trading CFDs with this provider.
How to Trade Stocks Ireland – Conclusion
To summarise, this guide has discussed how to trade stocks in Ireland in detail, highlighting all of the fundamental elements you need to know. Entering the stock market for the first time can be daunting, which is why it’s crucial to understand how to operate beforehand. By using this handy guide, you’ll have a solid foundation to begin trading in Ireland – providing a pathway to making solid returns.
So, if you’d like to begin stock trading in Ireland today, we’d recommend using eToro. eToro is a commission-free broker and allows users to trade a vast selection of real stocks and stock CFDs. Furthermore, users can trade from as little as $50 per position – and can even deposit via PayPal!