In a nutshell
Free stock trading. Awesome. Lightyear is completely free, well, except if you convert currency over £3,000 per month, and even then it’s the cheapest out there. It’s a great app, super easy to use, but the range of investments are limited. 2 stars from us.
cracked open 🥥
The world of investing moves fast, and Lightyear is the new kid on the block, and it could well be lightyears ahead.
It’s completely fee-free, there’s no account fees, and no commission on trades. The only fee you’ll pay is to convert currency, and that’s only if it’s over £3,000, and it’s actually the cheapest out there for that too. (they make money from customers above £3,000).
You can buy and sell (trade) stocks from the UK, US, Europe and the rest of the world too. However you can’t buy funds yet, called exchange-traded funds (ETFs), which are groups of stocks pooled together as one single investment.
With Lightyear, when you buy foreign stocks, you'll need to convert your pounds into the local currency (like the US dollar). But once you've done this you can keep that currency in your account. So you can start trading in multiple currencies and save on constant exchange fees.
The downside, there’s no Stocks & Shares ISA (yet), which means you may pay tax on your cash profits. More on that later.
The app is easy to use too, it’s on both Apple and Android, and very highly rated – 4.7 out of 5 on the Apple app store.
One great feature about the app is you get all the key information you need to make informed decisions when you view a company’s stock. There’s even analyst ratings, suggesting if it’s a good buy or not.
Let’s take a deeper look at Lightyear.
Is Lightyear good for beginners?
Yes and no.
If you are looking for experts to manage your investments for you, and grow your money over the long term, this isn’t for you. Check out the best investment apps and investing for beginners to learn more about that, oh and the best investment platforms.
If you’re new to stock trading, and that means buying and selling stocks yourself, with you making all the decisions, well then it’s perfect for you.
You can get started with as little as £1, and because there’s no fees, in theory you can grow your money a bit faster than platforms with much higher trading fees like Hargreaves Lansdown¹.
But even more useful, when you’re looking at companies to trade, you’ll actually get common info that the top investing analysts use, all within the app itself.
So, you can check out the market cap (value) of a business, the earnings per share, and whether it pays dividends and at what rate (giving profits back to shareholders – the people that own the stocks).
Plus there’s analysts ratings – showing whether they think it’s a good buy or not and the financial performance of the business too.
This might all sound super complicated, but you’ll soon pick it up while browsing through companies you are interested in trading.
It’s not very common to have this information laid out for you within an app – you used to have to go digging around various websites to find the info you need, not any more!
Range of investments
The range of investments is poor (for now), it covers UK stocks, US stocks, European stocks and many more global stocks, such as Chinese companies. But there’s not a huge amount of each.
You will be able to find all the big brand names and popular companies, however you won’t be able to find every company, particularly ones with a very low market cap (value), but there’s new stocks and funds added constantly, and if there’s specific stocks you want you can even request them to be added.
There’s no exchange-traded funds (ETFs) either, which are groups of companies all pooled together into one easy to buy fund – which saves you having to buy all the individual stocks themselves.
ETFs are hugely popular at the moment thanks to this, and they’re often a safer investment strategy than buying a single company where the price could change drastically.
How much is Lightyear?
It’s free! Well almost…
- there’s no fees to buy or sell stocks,
- no account fees,
- no set up fees,
- no deposit fees,
- no withdrawal fees
It's how trading should be!
The only fee you’ll pay is when you want to swap currencies, which you would do in order to buy foreign stocks such as US stocks or European stocks. This is called a currency conversion fee and is 0.35%.
However, you only pay this after you swap £3,000 per month – so the first £3,000 is free!
After this, if you converted £100 to $100, you’d pay £0.35 in fees, and you’d get £99.65 worth of Dollars. As simple as that.
Now that’s actually very cheap, if you compare currency exchange fees with other brokers and investment apps, here’s what you’d pay:
And these brokers all charge account fees too (except Freetrade’s basic account). Lightyear is the cheapest overall for everything.
There’s also no hidden fees, like spread fees, which are where the broker takes a small cut when you buy and sell currencies and stocks (by marking the price up when you go to buy).
The customer support is okay, but could be improved (which we anticipate it will be soon).
Having said that, there’s a good deal of information within the app itself, about how to manage your account and make trades, so maybe you won’t need to contact them much anyway.
And if there’s anything specific you can email them and they’ll get back to you pretty quickly.
At the moment there’s no live-chat feature and there is no option to speak over the phone.
Is Lightyear safe?
Yep! It’s authorised and regulated in the UK by the Financial Conduct Authority (FCA). That means it’s been reviewed and approved to look after your money.
Your money is actually held in a protected bank account that Lightyear cannot access, it is entirely separate to their company money and any money can only be returned to you.
And if you hold US stocks, you are protected up to $500,000 by the Securities Investor Protection Corporation. And with European stocks you are protected by the Estonian Investor Protection Sectoral Fund, which provides protection up to 20,000 euros.
Fractional shares: yep! You can buy as little or as much as you want of a company, and not worry about buying whole shares. You can buy 0.1% of a share if you like.
Trading features: there’s not many advanced trading features yet, such as setting advanced orders such as a stop-loss (when the stock is automatically sold when it reaches a certain price, which is common on the best trading platforms). It’s mostly simple manual buying and selling.
Stocks & Shares ISA: not yet. You can only get a general investment account, and you’ll have to pay tax on profit over £12,300 each tax year (6th April to 5th April the following year), but only if you sell to cash that is. If you’re after a Stocks & Shares ISA, check out our comparison table of investment platforms.
Pension: there's no personal pension either, which is where you'll get a bonus from the government too. Here's our comparison of pension providers if you're interested in this.
CFDs: a ‘contract for difference’ is making a trade with a broker based on the price of a stock, rather than buying the stock itself, and means you can trade the price going down! Lightyear doesn't offer this (yet), but the most popular platform for this is eToro¹.
Lightyear customer reviews
Customers love it. On the popular reviews website Trustpilot, it’s got a score of 4.7 out of 5. Not bad! In fact, it’s excellent.
Most customers love how the app works and how easy it is to buy stocks, along with the fast customer service, and the no fees of course!
We like Lightyear. How can you not when it’s completely fee free?! But we don’t love it.
You have to appreciate it’s a brand new app though, so they’re still building features that you might expect as standard on other platforms, such as a Stocks & Shares ISA, and the ability to make automatic trades (such as a stop-loss trade).
But it’s good overall for what it is, and if you’re new to investing, you can’t go wrong. If you’re more of an advanced trader, it’s still great for simple trades where you can benefit from the no fees (which can be super expensive on other platforms).
However, compared to Freetrade, it just doesn’t stack up. Freetrade has everything Lightyear has and more (like a Stocks & Shares ISA), and a much larger range of investment options, including ETFs.
Is there a deal?
Not right now.