If you are specifically looking for the best way to invest directly in shares, you may be considering investment platforms Freetrade or Hargreaves Lansdown. While Freetrade offers a low-cost way to invest straight from your mobile phone, Hargreaves Lansdown - the largest platform in the UK - also provides a way to invest in shares, as well as a wide range of other investment types.
In this article we weigh up the key features of both Freetrade* and Hargreaves Lansdown*. We also show you how you could get a free share worth between £10 and £100* with our reader offer with Freetrade (capital is at risk).
Freetrade vs Hargreaves Lansdown - which is better?
| Freetrade | Hargreaves Lansdown | |
| Services | Accessed through smartphone app
Stock performance information User forum |
Invest in funds and shares
Wealth Shortlist Master Portfolios Foreign currency exchange Spread betting and CFDs |
| Products | ISA, GIA, SIPP | Active Savings
Cash ISA Fund and share account Ready-made investments ISA, LISA, JISA, SIPP, Junior SIPP |
| Minimum investment | £1 | £1 for a fund and share account
£100 for an ISA or SIPP (or a regular £25 per month) |
| Fees | Basic account - free
Standard account - £5.99 per month or £59.88 annually (Includes ISA) Freetrade Plus - £11.99 per month or £119.88 annually (Includes ISA & SIPP) |
0.3% per year for Multi-Index Funds + account charges
Account charges for funds: £0-£250,000 - 0.45% £250,000-£1m - 0.25% £1m-£2m - 0.10% Over £2m - 0% No charges for holding shares No charges for Junior ISA Dealing charges (based on deals completed in previous month): 0-9 deals - £11.95 10-19 deals - £8.95 20+ deals - £5.95 |
| Customer reviews (Trustpilot) | 3.9/5.0 | 4.2/5.0 |
| Money to the Masses Offer | Receive a free share worth between £10 and £100* when you sign up for a basic account and deposit a minimum of £50 (Terms and conditions apply) | n/a |
Freetrade vs Hargreaves Lansdown - services
As a platform designed solely for buying and selling shares, ETFs and bonds, Freetrade doesn't offer as many services as Hargreaves Lansdown. However, it does provide the information and tools needed for users to search for shares, look at performance data, buy and sell shares and monitor portfolio performance from their smartphones.
For Hargreaves Lansdown, there is a wealth of information for investors, as well as model portfolios, ready-made portfolios, foreign currency exchange and spread betting and CFDs. It's structured in a more traditional format though, without the speed and efficiency of Freetrade's offering.
Freetrade vs Hargreaves Lansdown - products
Freetrade has a much more streamlined offering than Hargreaves Lansdown, with a General Investment Account (GIA), which forms its "Basic account", an ISA or a SIPP. Hargreaves Lansdown has a greater degree of choice, with cash and stocks and shares ISAs, GIA, LISA, JISA, SIPP and Junior SIPP. It also has separate savings accounts.
Freetrade vs Hargreaves Lansdown - minimum investment
Both Freetrade and Hargreaves Lansdown allow you to start investing with a minimum investment of just £1. This gives you access to a fund and shares account with Hargreaves Lansdown, with an ISA or SIPP requiring at least £100 at the outset, or £25 per month as a regular investment. Meanwhile, for Freetrade you can open any account with £1, although you will need to upgrade to a standard account at a cost of £5.99 per month (or £59.88 if paying annually) if you want access to an ISA. Those wanting access to a SIPP would need to upgrade to a Freetrade Plus account at a cost of £11.99 per month (or £119.88 if paying annually).
Freetrade vs Hargreaves Lansdown - fees
As a platform designed exclusively to allow investors to buy and trade shares, the fees for Freetrade are structured quite differently than those for Hargreaves Lansdown. At its core is the principle that buying and selling shares is free and this is the case even with its basic account. If you upgrade to a Freetrade Plus account for £11.99 per month, you can hold your money in an ISA and/or SIPP as well as having access to additional features, including the capacity to earn up to 5% interest on any cash you hold.
For Hargreaves Lansdown, the charging model is more traditional, with investors charged a percentage of the total amount invested in funds, which works on a sliding scale. For those with under £250,000, the charge is 0.45%. However, there are no account charges for holding shares, although there are dealing charges of between £5.95 and £11.95 per trade, depending on the number of trades completed in the previous month.
Freetrade vs Hargreaves Lansdown - customer reviews
Based on the results on customer review site Trustpilot, both Hargreaves Lansdown* and Freetrade* are rated highly by their customers. Hargreaves Lansdown has an overall rating of 4.2 out of 5.0 stars based on over 11,300 reviews, while Freetrade is rated 3.9 out of 5.0 based on just over 4,000 reviews. Of those, 67% claimed Freetrade was "Excellent", compared with 60% for Hargreaves Lansdown.
Freetrade tended to get good reviews of the ease-of-use and low-cost nature of its proposition, while Hargreaves Lansdown was praised for its customer service.
Summary: Freetrade vs Hargreaves Lansdown
If you are looking specifically to buy and sell shares, Freetrade is an attractive option as it is low cost and easy to manage direct from your phone. In comparison, Hargreaves Lansdown's more traditional platform, with a wide range of products and services, may appeal to a slightly older demographic than Freetrade's target audience. The benefit of a more old-school approach is that Hargreaves Lansdown has more resources available to enable investors to create well-balanced portfolios. While Freetrade has a good forum, where you can get ideas for what to invest in, it can be difficult for beginners to achieve a good level of diversification.
For more detailed explanations of each of the platforms, read our Freetrade review and Hargreaves Lansdown review.
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