Chapter 13 – How clients should buy or sell shares

As we discuss here, Dover’s strong conviction is that clients should perform their own share transactions. Advisers should never seek to complete these transactions on the client’s behalf.

Shares on the ASX must be bought or sold via an approved broker. Given that the adviser is recommending which shares to buy, the client only needs an ‘execution-only’ brokerage services. 

The ASX provides a searchable list of execution-only brokers on its site here. As of February 2016, the list was as follows:

AFS Capital Securities Ltd Morgan Stanley Wealth Management Australia Pty Ltd
APP Securities Pty Ltd Morgans Financial Limited
Argonaut Securities Pty Ltd Morrison Securities Pty Limited
Ascot Securities Pty Ltd Openmarkets Australia Limited
Baillieu Holst Ltd Ord Minnett Limited
Baker Young Stockbrokers Limited Patersons Securities Limited
Bell Potter Securities Limited Phillip Capital Limited
Bridges Financial Services Pty Ltd Prescott Securities Limited
Burrell Stockbroking Pty Limited Sentinel Financial Group Pty Ltd trading as Sentinel Stockbroking
CCZ Statton Equities Pty Limited Shadforths Limited
CMC Markets Stockbroking Limited Shaw and Partners Limited
Commonwealth Securities Limited State One Stockbroking Limited
D2MX Pty Ltd Taylor Collison Limited
ETRADE Australia Securities Limited Third Party Platform Pty Ltd
Euroz Securities Limited Timber Hill Australia Pty Ltd
Evans and Partners Pty Ltd UBS Wealth Management Australia Ltd
Hartleys Limited Wealthhub Securities Limited
Joseph Palmer & Sons Wilson HTM Ltd
Macquarie Equities Limited  

Given that the intention is to buy and hold relatively few shares, the cheapest of these options which is also convenient should suit most clients.

The financial services rating website Canstar allows users to compare various online brokers based on criteria such as the number of trades in a given period. This is one simple way for advisers to determine which online broker to use.

Another is to simply make use of the client’s existing or otherwise preferred bank. All of the major banks have online trading facilities attached to them, and this often makes for simplicity in terms of moving money in and out of the particular trading account. Most also allow the trading account balance to be displayed alongside other accounts on the client’s internet banking site. This also makes for ease of administration in terms of tax return preparation.

The Dover Group