Recommend a mainstream broker that can trade on London Stock Exchange?

Question

I use TD Waterhouse and E-Trade, but neither of these give me the ability to trade on the London Stock Exchange (online or over the phone). I am looking to occasionally buy and sell shares of British companies. Any recommendations?

Answer 1

If you're in Canada, TD can certainly place orders on London stock exchange for you. So can any other broker.

Trades cannot be done online as far as I know. Must be phoned in. Problem is the commissions are quite high. About $150.00.

At least one online brokerage offers London and other foreign exchange trades at ultra low commissions. It's Interactivebrokers. Dot com for the US, dot ca for Canada. Warning: IB has sophisticated software, an experienced clientele, is not for the average retail investor.

Answer 2

Oh those pesky brokers and their commissions. Brokers can help match buyers and sellers at the best possible price, but they do charge a premium. It's not as bad as it used to be. Thirty or forty years ago, commissions could be staggering. Now you execute just about any type of trade (market, limit, stop limit, buy limit, IOC, MAQ, AON, order not held, etc) for one flat fee. Also remember that not all stocks are traded on "one" exchange. Stocks can have "dual" listings, trade in multiple markets (primary, OTC), trade on different ECN's, etc. Brokers allow you access to all these venues. A broker will allow you to route your order or they can do it for you to obtain the best possible price at the quickest speed. When it comes to trading latency is key. Brokers also keep the track of pertinent information that you wouldn't want to be responsible for (dividends, splits, records for tax purposes). Brokers also process (clear) the trade for you. Also, to trade directly on an exchange like the big board (NYSE), you'd have to have a seat on the exchange. I think they're selling for around $800,000 these days. If transaction costs are your issue, then shop around. I'm a professionally licensed trader and my transaction cost are so low that I don't bat an eye at pulling the trigger when it's go time. I hope this answered your question.