Investment gurus know that the most effective way to grow your wealth is to let your money work for you. But in what ways does money work for you?
Of course, there are a couple of places you can take your money to work, and the stock market is at the top of the pile. But it is not as simple as you may think, especially without a good broker.
You need an established investment broker.
Undoubtedly, the investment brokerage industry has changed for the better, with the development and growth of internet technology. You no longer have to call your stockbroker to buy shares for you, as you can now conveniently and quickly trade stocks online.
But trading stocks online is not sufficient by itself. You need to decide how much to invest in the long term and pick the right broker for you.
The Benefits of Long Term Investing
Long-term investing should be looked at as an overall investing strategy. You see, short-term investors quickly feel the effects of declining stock values and can easily get discouraged, but going long-term evens out the volatility.
Usually, a long-term investor’s account will include bonds, real estate, and stocks. The long-term investment strategy includes holding the investment for more than a year. Sometimes, the assets may not be sold at all, even after maturity.
One group of investors that can significantly benefit from investing in the long term is speculators. Constantly weighing up the risks as you invest can help you rake up decent profits to make it worth the effort.
Certainly, long-term investing comes with risks that are higher than short-term investing. But the strategy has much better profits or benefits when held to maturity.
So which are the best long-term investment brokers?
Best Long Term Investment Brokers
1. eToro
Established in 2007, eToro boasts a wealth of experience serving a base of over 20 million clients. The investment broker does not have a parent bank and does not disclose its annual report.
However, its popularity and regulation by top-tier fintech regulatory bodies in the UK and Australia make it a safe bet in the view of most investors.
The long-term investment broker brings some of the most competitive offers in cryptocurrency, indices, social trading, CFDs, Forex, Exchange Traded Funds (ETF), and Index-Based Funds. But cryptocurrency availability is subject to regulation, and it may not be available in some countries.
eToro serves various clients worldwide through the units regulated by the relevant authorities such as the Australian Securities and Investment Commission and Financial Conduct Authority (FCA). All the other customers around the world are served by a unit that complies with Cyprus Securities and Exchange Commission (CySEC).
The broker has various advantages to customers, such as commission-free stock trading. Opening an eToro account is effortless and packs various innovative features such as social trading, where you are free to copy the trading strategies of other more experienced users.
2. XTB
Online Trading (XTB) is a publicly listed investment firm in Poland. XTB provides access to various investments such as commodities, metals, indices, shares, forex, and even digital currencies.
The investment broker is Financial Conduct Authority (FCA)-registered and under the Polish Financial Supervision Authority (KNF). FCA is quite strict in ensuring companies abide by all rules and regulations to safeguard the interests of investors.
XTB provides negative balance protection, and their customer focus is better than most. It is easy to access customer service any time and day through the live chat and dedicated account manager.
XTB’s xStation 5 is their flagship web-based platform. Other online offerings are the functional mobile app and the downloadable MT4 platform.
All their ancillary costs are almost the same as other brokers on the market, and they have relatively lower spreads to cater to cost-conscious investors.
On the downside, XTB is not eligible for people in the US. The platform charges commissions for stock CFD and cryptocurrency transactions and does not have guaranteed stop losses. You also don’t have the option to customize indicators.
3. AvaTrade
New and budget-focused investors will feel at home with AvaTrade. Typically, the broker has a product suite with various user interfaces to choose from and reasonable spreads.
AvaTrade has been around since 2006 and has grown its presence throughout Europe and Asia pacific. Their headquarters are in Dublin, Ireland.
Account opening is effortless, fully digital, and has various options to deposit and withdraw, all of which do not carry any charges. The account gives you access to various asset classes, including commodities, forex, cryptocurrencies, ETFs, bonds, stocks, and indices.
Other great functionalities include education and research tools. Users across all jurisdictions enjoy negative balance protection at all times. And unlike most other accounts, you can take out insurance on AvaTrade.
The research and news functionality is not part of the product suite, and the Avatrade product portfolio is not that large. It only caters to various commodities, indexes, cryptocurrencies, and stocks. Although the fee structure is one of the most transparent, and trading costs are easy to determine, the fees charged for inactivity are high. AvaTrade is not under the esteemed FCA regulation.
4.Fidelity Investments
Fidelity Investments ranks high based on the excellent execution of orders and its practical range of tools for investing. Their primary focus, it seems, is on lowering the costs for its clients.
In 2019, the investment brokers lowered the commissions to zero and improved the education and research offerings. Both long-term and short-term clients can base their decisions on good quality info for profitability.
There are great opportunities to earn more even without realizing it because the firm puts any idle cash into a money market fund. You can still earn more through the stock loan program. Clients have a choice on the stocks to be used for the loan program.
But there are also shortcomings. As an investor, you will need to combine the various tools in Fidelity platforms to access the research and tools you need to make a decision. Some rival firms will have these tools and research available for both mobile and web-based platforms.
Users will also need to manually refresh the data to get updated information. Fidelity does not have any options for futures and does not offer commodities.
5. TD Ameritrade
As a beginner to long-term investment, an account with all the features to make the process simpler comes in handy.
TD Ameritrade is in the process of making their web and mobile-based platforms easier to use to beginners and investors in other levels.
The brokerage firm has a rich database of educational resources, ranging from beginner to advanced. New users can create a new Ameritrade account and take their time to learn about using it.
Ameritrade mobile platform is the best in its class based on various features for active investors and traders. Working with futures, stocks, and options is intuitive and reasonably practical. In essence, the mobile platform is similar to the web one, and you don’t need to switch from one platform to the other to take full advantage of the various features.
Ameritrade has a wide selection of account types, and this can be confusing for new traders. They may not be entirely sure which among the accounts is the best.
Why You Need the Services of an Investment Broker
Some people will toy with the idea of going it solo without the services of an investment broker, but it’s not that easy. You can take advantage of other methods, but only if you have some substantial wealth and knowledge.
Qualities of the Best Long Term Investment Broker
Picking a long-term investment broker is an integral part of investing. So, which qualities define the best long-term investment broker?
- History
An investment broker you intend to use in the long term should be steeped in a brokerage history of at least two years. As much as having qualified personnel is essential, the brokerage firm should have some good experience in the market.
A minimum of two years in the trade will ensure the firm has some of the essential basics and information on the market dynamics to provide the best guidance.
- Regulation
Disputes are part and parcel of everyday business, and investment brokerages are no exception. Ideally, your choice of brokerage firm for long-term investment should be under a jurisdiction that can call them to answer for misconduct.
They should be under an authority that can best play arbitration in cases where the disputes are bigger.
- Sufficient Customer Support
Reasonably sized customer support is a non-negotiable requirement when shopping for a brokerage firm. You see, investing is a thick jungle for the faint of heart, and a little human guidance goes a long way.
Many online long-term brokers now have Robo-advisers, but human support once in a while is reassuring.
- Withdrawal and Deposits
It makes no sense to wait for almost a week for a withdrawal or deposit to go through. Efficiency in deposits and withdrawal makes trading smooth because you can move the funds when you need to. Ideally, the processing time for withdrawals should be between two and three days.
Conclusion
Long-term investments often have a better yield when held to maturity than short-term investments. Take your investing game to the long-term investment assets and grow your wealth to secure your future. The best long-term investment broker will help you achieve this goal. Choose wisely.
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