Is Freetrade free?

Freetrade is in fact a zero-commission broker when it comes to buying and selling US stocks. Zero commission is especially useful if you trade relatively low volumes, like buying stocks for less than $500 per trade, because you won't be hit with any minimum fees the broker might charge.

We should note that the payment-for-order-flow model, which is used by some zero-commission brokers to generate income (rather than relying on commissions), could potentially create a conflict of interest between you and your broker. This could result in trade execution (like routing your orders to specific market makers) that might be unfavorable for you under certain market conditions, especially when using market orders (as opposed to limit orders, which seem to be less affected).

Keep in mind that at some brokers, you could incur non-trading charges like withdrawal or inactivity fees. If you want to trade options, bonds or futures, then a transaction fee may also apply. Also, if you trade on margin, the margin rate charged by brokers can differ wildly. In the next chapter, we'll find out what these charges are at Freetrade and how they compare with fees charged by its closest competitors.

If you want to read our full review, including fees, deposit options and other platforms (like web and desktop) then skip to the Freetrade review.

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Freetrade fees
Overview of Freetrade fees and charges

It's safe to say that Freetrade's fees are low in general. They either don't charge a brokerage fee for things that other brokers do, or they only charge a small amount.

Here's a high-level overview of Freetrade's fees

Freetrade Fees snapshot
Assets Fee level Fee terms
US stock fee Low £0 for basic orders and for instant/market orders
EURUSD fee - Not available
US mutual fund fees - Not available
Inactivity fee Low No inactivity fee

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Freetrade fees
Freetrade fees explained

Online brokerages in general charge much lower brokerage fees than traditional brokerages do - this is largely because online brokerages' businesses can be much better scaled: from a purely technical standpoint, it doesn't make that much of a difference for them if they have 100 or 5,000 clients.

This is not to say, however, that they don't charge any fees at all. They make money by charging you various rates for various actions or events. Usually you need to keep an eye on the following three types of fees:

  • Trading fees - these are brokerage fees that you pay when you actually carry out a trade, like buying an Apple share or an ETF. What you pay is either a commission, a spread or a financing rate. Some brokers apply all of these.
    • A commission is either fixed or based on the traded volume.
    • A spread is the difference between the buy price and the sell price.
    • A financing rate or overnight rate is charged when you hold your leveraged positions for more than one day.
  • Non-trading fees. These are usually related to some operations you carry out in your account, such as depositing money, withdrawing money, or not trading for an extended period.

We compare Freetrade fees with its closest competitors, Stake and Passfolio.

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Freetrade fees
Freetrade trading fees

Freetrade's trading fees are low, which makes it suitable for you even if you trade often (i.e. several times a week).

Let's break down trading fees according to the different asset classes available at Freetrade.

Trading fees

Freetrade's trading fees are low.

Stock fees and ETF fees

Freetrade has low stock trading fees.

Stock fees of a $2,000 trade
Freetrade Stake Passfolio
US stock $0.0 $0.0 $0.0
UK stock $0.0 - -
German stock - - -

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Freetrade fees
Freetrade non-trading fees

When it comes to non-trading fees, Freetrade is a rather cheap broker.

Non-trading fees include various brokerage fees and charges at Freetrade that are not related to buying or selling assets. This can be a withdrawal fee, deposit fee, inactivity fee or account fee.

A high-level overview of how Freetrade stacks up in terms of non-trading fees
Freetrade Stake Passfolio
Withdrawal fee $0 $2 $0
Deposit fee $0 $0 $0
Inactivity fee No No No
Account fee No No No

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Freetrade fees
Freetrade deposit fee

Usually, brokers don't charge anything for deposits, and Freetrade is no different.

Freetrade deposit methods
Freetrade Stake Passfolio
Bank transfer Yes Yes Yes
Credit/debit card Yes Yes No
Electronic wallets Yes No No
Deposit fee $0 $0 $0

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Freetrade fees
Freetrade withdrawal fee

Freetrade generally doesn't charge a withdrawal fee.

Freetrade withdrawal fees and options compared
Freetrade Stake Passfolio
Bank transfer Yes Yes Yes
Credit/debit card Yes Yes No
Electronic wallets Yes No No
Withdrawal fee for bank transfer $0 $2 $0

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Freetrade fees
Freetrade inactivity fee

Freetrade does not apply an inactivity fee, which is great because your account won't be charged even if you do not trade for an extended period (like several months or years).

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Author of this article

Bence András Rózsa

Author of this article

Bence’s purpose is to help you to understand the logic behind financial services. In his master’s studies, he specialised in business economy and finance to be able to give you a clear picture of the brokerage world. Having reviewed multiple brokers and robo-advisor services, his goal will always be to guide you in the world of investing as it is.

Bence András Rózsa

Broker Analyst

Bence’s purpose is to help you to understand the logic behind financial services. In his master’s studies, he specialised in business economy and finance to be able to give you a clear picture of the brokerage world. Having reviewed multiple brokers and robo-advisor services, his goal will always be to guide you in the world of investing as it is.

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

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