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Here’s How To Avoid Using The Wrong Investment Platform In 2023

When done right, investing your money can be a great way to build wealth for the future. However, between 69% and 84% of retail investors will lose money at some point during their investment journey. While there are a number of reasons for this, a large contributor is that many investors fall into the trap of using the wrong platform.

To help you avoid making this mistake, we have curated a simple guide on how to avoid using the wrong investment platform in 2023.

Conduct your own research

One of the most crucial aspects of choosing the right platform is to conduct your own research into potential options. Many investors simply use the first platform that comes up on Google Search or the one that is endorsed by their favourite celebrity. Doing this could prevent you from finding a platform that truly works.

Instead, we recommend taking time to read investing reviews, test out demo trading accounts and conduct your own comparisons between different platforms. While this may seem time-consuming, conducting your own research will enable you to get a better idea of what is out there.

Be clear with your goals

The investment platform that is best for you will depend on your goals and strategy. Therefore, it is important to be clear about these before deciding which platform to use. Many investors miss out on useful features because they use platforms that don’t meet their needs.

Important questions to ask yourself include: 

  • How long will you be holding each stock for?
  • Do you want to use auto trading tools?
  • What kind of educational resources will be the most useful to you?
  • Will you need advanced or basic charting tools?
  • Are you interested in diversifying your portfolio with multiple asset classes?

Once you have clearly established your goals, you can start to search for platforms that tick all of your boxes. You can then start to narrow down your options and avoid using a platform that doesn’t offer everything you need.

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Understand platform fees

A big mistake that many investors make is overlooking platform fees. Every platform will have a different fee structure and it is important to understand this before opening an account. If you aren’t careful, the fees involved with using a platform could take away a big percentage of your investment profits.

The best trading platforms will be transparent about fees. However, some platforms may be less obvious about what they charge which could result in you paying more than you originally intended to.

Typical trading platform fees to look out for include payment fees, withdrawal fees, inactivity fees, trading fees, exchange rates, account management fees and trade commissions. To maximise your returns, try to find a platform that charges relatively low fees compared to others on the market.

Conclusion

Choosing the right investment platform could help you to avoid running into problems further down the line. To understand which platform is best for you we recommend conducting your own research, knowing your goals and understanding platform fees. Of course, there is always risk involved with investing and choosing the right platform does not guarantee returns.

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