{"id":389618,"date":"2026-03-17T12:52:16","date_gmt":"2026-03-17T12:52:16","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/389618\/"},"modified":"2026-03-17T12:52:16","modified_gmt":"2026-03-17T12:52:16","slug":"pros-cons-and-the-smart-way-to-keep-costs-down-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/389618\/","title":{"rendered":"Pros, cons and the smart way to keep costs down \u2013 The Irish Times"},"content":{"rendered":"

\u2018How to Invest\u2019 is a series of articles guiding readers through the basics of investing in different assets. See also: <\/b>The risks of leaving money on deposit<\/b><\/a>. <\/p>\n

It might seem a precipitous moment to consider putting a toe into the investing waters. War in Iran<\/a>, soaring oil prices<\/a> and an uncertain outlook for the US dollar are just three factors triggering volatility in the markets. And yet this also means, perhaps, that it is more important than ever to get a better return on your money to ensure you keep pace with rising prices.<\/p>\n

\u201cInvesting through the stock market<\/a>; you\u2019d expect returns to be better than bank deposits,\u201d says Rory Gillen, founder of Gillen Markets, now a part of Quilter.<\/p>\n

This week, as part of our new series on investing, we look at how to start investing in stock market shares \u2013 the risks, possible upside, costs and potential taxes. <\/p>\n

How can I buy stocks?<\/b><\/p>\n

Stocks are bought through brokers, most of whom these days have online operations. Some operate purely online. You can open an account with a broker, like IG, Interactive Brokers, Davy Select, Goodbody or Revolut, and place a buy order. <\/p>\n

Each has their own rules and minimum investment amounts.<\/p>\n

\u201cThe platform you use is important \u2013 for the costs and the security of client assets,\u201d says Gillen. You will want to put your money into a regulated provider, where your money is typically protected by up to \u20ac20,000 (or 90 per cent of the loss) in the event of insolvency under the Irish Investor Compensation Scheme.<\/p>\n

If you\u2019re investing yourself, you\u2019ll be looking for what is called an execution only offering \u2013 where you simply engage the broker to buy and sell on the back of your own research and decision \u2013 to keep costs down. The alternative is to seek out an advisory service, which will have significantly higher costs, but it means that you\u2019ll have an adviser in the brokerage guiding your decisions.<\/p>\n

You won\u2019t need a large cash injection to get started: shares in Ryanair cost about \u20ac26 for example, Shell is about \u20ac35, Unilever \u20ac60, and Bank of Ireland \u20ac16.<\/p>\n

It\u2019s more expensive to get invested in US tech stocks however: shares in Nvidia are about $177; $260 in Apple; and almost $400 in Microsoft. Some brokers do allow you to buy a fraction of a share. <\/p>\n

How much will it cost me?<\/b><\/p>\n

Given the level of uncertainty when it comes to investing, one way to introduce some element of certainty is to understand your fee structure \u2013 and shop around to get the best one for you.<\/p>\n

\u201cWatch your fees,\u201d says Michael Healy, managing director UK and Ireland, at IG Group, which is ramping up its presence in Ireland. He says it is very hard for an average person to make investing work if they are facing high fees on transactions.<\/p>\n

In general, the cost of investing in shares has fallen significantly since the 1990s.<\/p>\n

\u201cIf you save \u20ac1,000 a go, you can get it invested very efficiently, probably for under 1 per cent, if you include all costs \u2013 that\u2019s only \u20ac10,\u201d says Gillen.<\/p>\n

If trading frequently in the US, you could keep FX (foreign exchange) costs down by opening a US denominated account (although there will be FX charges on the initial conversion). De Giro for example, gives a cost of just \u20ac2 when buying 100 Nvidia stocks with a US dollar account, compared with more than \u20ac40 from an euro account.<\/p>\n

Another option is to buy the euro listed version of a US stock \u2013 for example, Nvidia has a euro listing in Germany. Buying this with Nvidia would only cost \u20ac3.90 with De Giro. However, this will trade differently to the Nasdaq stock, so prepare for that.<\/p>\n

[\u00a0How to invest: What are the risks of leaving your money on deposit?Opens in new window<\/a>\u00a0]<\/p>\n

What are the pros?<\/b><\/p>\n

The statistics are there; over the long-term, buying shares outperforms bank deposits (if you can tolerate periods of volatility). If you invested $1,000 (\u20ac872) in Apple for example, back in 2000 when it was priced at $1.19, you\u2019d be sitting on a lump-sum of about $220,000 these days.<\/p>\n

And buying into individual stocks allows you to fine-tune your investment strategy. There are also tax advantages associated with stocks over other investment assets (see below). <\/p>\n

And the cons?<\/b><\/p>\n

The downside of buying stocks is that to do it well, you do need to inform yourself \u2013 and to identify the future Apples when they\u2019re still cheap. For every Apple, there are many failures that will cost you money.<\/p>\n

\u201cI think young people are probably picking it up better as there is so much stuff available online, and they are more comfortable with it,\u201d says Gillen, \u201cBut I haven\u2019t really seen a pick-up myself in the older generation.\u201d<\/p>\n

Gillen has been running training courses for 20 years now (next one is on May 9th) and he\u2019s seen a pickup in demand.<\/p>\n

\u201cEducation is key. If you want better returns, the onus is on you to become better informed,\u201d says Gillen, and this means learning to deal with volatility.<\/p>\n

\u201cVolatility plays on people\u2019s emotions. They buy high and sell low: the number one objective is to learn not to do that\u201d.<\/p>\n

How risky is investing in shares?<\/b>\"ByBy concentrating your investments, the upside could also be greater if you choose the right company. Photograph: Getty Images <\/p>\n

Opting to buy shares in individual companies, rather than spreading your money across a number of different companies in a fund, is a riskier proposition, as your money will likely be spread across fewer companies than would be the case in a fund. A key issue in the run-up to the financial crisis in Ireland was an over-concentration by Irish investors on Irish stocks, which account for just a small fraction of the investing universe. <\/p>\n

Of course, by concentrating your investments, the upside could also be greater if you choose the right company.<\/p>\n

In any case, there are some ways to mitigate risk. \u201cBefore you start investing, have your rainy day fund,\u201d says Healy, \u201csome people say six months of expenses, but it depends on your circumstances\u201d.<\/p>\n

Typically, you\u2019ll want to keep this in an easily accessible savings account.<\/p>\n

Next, you\u2019ll need to spread your risk.<\/p>\n

[\u00a0\u2018On the bus, look around at what products people are using\u2019 \u2013 a beginner\u2019s guide to investingOpens in new window<\/a>\u00a0]<\/p>\n

\u201cDiversify \u2013 it takes away a lot of risk,\u201d says Healy. \u201cIf you buy a broad-based basket of stocks and funds, a lot of the risk looks after itself. Don\u2019t concentrate on a small number of holdings.\u201d<\/p>\n

Some stocks offer a natural diversification \u2013 class B shares in Berkshire Hathaway for example, the conglomerate led until recently by famed investor Warren Buffett, cost about $500 (class A shares, whose closing price last week was almost $750,000, are for the very wealthy).<\/p>\n

\u201cIf you buy into that you\u2019re getting the diversity,\u201d says Gillen.<\/p>\n

You also need to be realistic about what you can and cannot do.<\/p>\n

\u201cIt\u2019s very hard to time markets, so don\u2019t try. Turn investing into a habit, instead of trying to predict whether the market will be up or down next week,\u201d says Healy, adding: \u201cDon\u2019t try and be the smartest guy or girl in the room, let your gains compound over time.\u201d<\/p>\n

If you\u2019re trying to manage currency risk, you could opt for euro denominated stocks.<\/p>\n

So-called dollar cost averaging, whereby you allocate a fixed sum of money into the stock market at regular intervals is another way that can help smooth the peaks and troughs of price movements. <\/p>\n

\u201cRegular investing is very low risk,\u201d says Gillen.<\/p>\n

What about taxes?<\/b><\/p>\n

Taxes in Ireland can confuse, perplex, and annoy \u2013 and in many cases, determine investment asset choice.<\/p>\n

\u201cI think it\u2019s very difficult not to take the tax treatment into account,\u201d says Catriona Coady, head of tax with Goodbody Stockbrokers, of investment decisions. <\/p>\n

First up, you\u2019ll pay capital gains tax (CGT) at a rate of 33 per cent on any gains you make, over and above an annual CGT allowance of \u20ac1,270.<\/p>\n

This allowance is allocated on an individual basis. \u201cAny part of an annual allowance cannot be transferred,\u201d says Coady, and you also can\u2019t carry it forward if unused.<\/p>\n

[\u00a0Are you a beginner investor or looking to start? We want to hear from youOpens in new window<\/a>\u00a0]<\/p>\n

If you make a loss, you can offset those losses against gains arising in the same year. If the losses are not fully offset that year, they can be carried forward until they are matched by gains on other investments. In short, this means that a crystallised loss of \u20ac1,000 will save you \u20ac330 in tax on a future gain \u2013 and there is no time limit in which this must be used.<\/p>\n

\u201cBut you\u2019ll generally not try to cash out of shares at a time when it might trigger large losses,\u201d says Coady.<\/p>\n

If your shares pay you dividends, these are seen as income and you will pay tax on this at your marginal income tax rate, plus USC and PRSI. As Coady points out, this could be a top rate of between 52 and 55 per cent, depending on your tax rate.<\/p>\n

Dividend withholding tax also applies. This obliges the company paying dividends to withhold 25 per cent of the payment and send it to Revenue. You will get a credit for this against any income tax liability.<\/p>\n

\"TheThe onus is on you to settle your tax bill, says Catriona Coady. Photograph: Getty Images <\/p>\n

It\u2019s worth noting that dividend withholding tax rates vary from country to country \u2013 Swiss stocks, for example, have a withholding rate of 35 per cent, but this can be reduced to a double taxation treaty rate of 15 per cent.<\/p>\n

\u201cIt can get a little bit complex, you have to make sure you\u2019re getting the benefit of the lower treaty rate,\u201d says Coady.<\/p>\n

And if you buy Irish shares, factor in stamp duty. This is levied at a rate of 1 per cent but, from January this year, companies with a market cap less than \u20ac1 billion are excluded from this.<\/p>\n

And how do you settle your tax bill?<\/p>\n

\u201cThe onus is on you,\u201d says Coady. This means keeping track of dividends you\u2019ve received, and working out the tax owed. To learn more, Goodbody Stockbrokers has an investment tax guide that covers the treatment of most asset types.<\/p>\n

How can I exit my stock investment?<\/b><\/p>\n

If you buy a stock on a main listing, there shouldn\u2019t be any issues in selling out of it, once the market is open. As with buying, you will do it through your broker, so expect charges again.<\/p>\n

Trading<\/b>How much will it cost me?<\/b><\/p>\n

It\u2019s worth doing some research on which brokerage offering is the best match for you. That will likely depend on where you\u2019re going to trade, how frequently, and with how much money.<\/p>\n

Davy Stockbrokers<\/b> for example, levies an account holding fee of \u20ac50 per quarter for its Davy Select customers. You can reduce this however if you trade every month \u2013 the commission rate is 0.5 per cent, so if you trade more than \u20ac10,000 in the quarter, no holding fee applies. <\/p>\n

When it comes to trading, a spokesman says it would charge commission of 0.5 per cent on a \u20ac15,432 trade to acquire 100 shares in Nvidia (based on share price of $177), and a third-party overseas custody charge of \u20ac34.26. <\/p>\n

It offers multicurrency accounts, so no foreign exchange (FX) charges apply providing you have and use the relevant currency account. So, in total, this trade would incur charges of some \u20ac111.42 \u2013 and no account holding fee would apply.<\/p>\n

Davy\u2019s traditional main street rival, Goodbody, charges a \u20ac100 annual account maintenance fee plus commission of 1 per cent on a stock purchase of this size. It also has an overseas custody charge \u2013 of \u20ac25 \u2013 so you would pay for the same trade.<\/p>\n

To buy the same 100 shares in Nvidia, IG <\/b>would charge an FX fee of 0.7 per cent, but no commission or transaction charges, resulting in a cost of about $107 (\u20ac92.50).<\/p>\n

Dutch-based broker De Giro<\/b> has a handling\/commission charge of \u20ac2 on a similar trade, plus an FX fee of 0.25 per cent (\u20ac38.30). And if it\u2019s your first time trading on Nasdaq that year, you\u2019ll also pay a \u20ac2.50 exchange connection fee. So about \u20ac42.80 in total.<\/p>\n

Interactive Brokers<\/b> says it has no account holding fees, account minimums or inactivity fees. To buy 100 shares in Nvidia, it would charge $1.02 in stock commissions and fees and a $2 minimum, so a $3.02 total trade cost, according to a spokeswoman.<\/p>\n

Finally, Revolut<\/b> allows most plan members one free trade a month. On that basis, a similar trade would cost \u20ac150 in FX fees for standard plan holders, falling to \u20ac0 for premium, metal and ultra. <\/p>\n

Once you go over one trade a month, your fees will depend on your plan \u2013 0.25 per cent (min \u20ac1) for standard, plus, premium and metal plans, and 0.12 per cent (min \u20ac1) for ultra or trading pro plans. So, if this was a second trade, standard plan holders would pay about \u20ac188 in costs.<\/p>\n

Remember, you will also face charges when selling out of a stock.<\/p>\n","protected":false},"excerpt":{"rendered":"\u2018How to Invest\u2019 is a series of articles guiding readers through the basics of investing in different assets.…\n","protected":false},"author":2,"featured_media":389619,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[73],"tags":[79,28197,18,139652,173818,19,17,10927,107],"class_list":["post-389618","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-davy-group","tag-eire","tag-goodbody-stockbrokers","tag-how-to-invest","tag-ie","tag-ireland","tag-revolut","tag-us"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/116244614084421958","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/389618","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=389618"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/389618\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/389619"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=389618"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=389618"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=389618"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}