Best Mutual Fund Trading Platforms in UAE
Investing in mutual funds is a great idea for investors with limited knowledge and time, who want a professional to manage their investment. We recommend buying mutual funds directly from the fund company or through their own trading platforms due to lower overall costs.
In this guide, we describe the best trading platforms for mutual funds based on their characteristics, fees, management style and efficiency.
Best Trading Platforms for Mutual Funds in UAE
- Interactive brokers
- TD Ameritrade
- Ally Invest
- Charles Schwab
- Loyalty investments
Below we break down the best trading platforms in the UAE for mutual funds, starting with the highest rated – Interactive Brokers
1. Interactive Brokers
With Interactive Brokers, you can invest in over 17,000 funds without paying transaction fees and 45,000 funds in total. In 2020, Interactive Brokers expanded its mutual fund trading platform to include no-fee mutual funds. You can also invest in stocks, bonds and other asset classes through Interactive Brokers. There is no minimum deposit required and the standard price for mutual funds is 3% of the purchase value.
2. TD Ameritrade
With a TD Ameritrade account, you can invest in over 3,700 mutual funds free of charge. TD Ameritrade provides detailed information about each fund so you know exactly what you’re investing in and how it’s performing. This data is provided by Morningstar and is updated quarterly. TD Ameritrade also offers currency, stock and bond trading. You can start investing in no-fee mutual funds with TD Ameritrade from $1.
3. Invest Ally
Ally Invest offers its clients over 12,000 mutual funds to invest in. They charge a commission of $9.95 on mutual funds with no fees and you can buy mutual funds from $0. Ally Invest has outstanding customer service and you can start investing in mutual funds from $1 with them.
4. Charles Schwab
Charles Schwab is a broker founded in the 1970s that offers over 4,200 mutual funds with no fees or transaction fees to invest in. On other mutual funds, they charge a commission of $74.95. There is no minimum deposit required to open a trading account with them and it can be easily done online.
5. Loyalty investments
With Boston-based Fidelity Investments, you can invest in four funds at no cost: Fidelity Zero Total Market Index Fund, Fidelity Zero International Index Fund, Fidelity Zero Large Cap Index Fund and Fidelity Zero Extended Market Index Fund. There are over 3,400 mutual funds in total with no transaction fees and you don’t have to pay trading fees as long as you hold the funds for at least 60 days. Fidelity Investments does not require a minimum deposit and charges $49.95 on standard mutual funds.
What is a mutual fund?
A mutual fund is a large portfolio of investments shared among its investors. Mutual funds spread their risk by investing in many companies. When you invest in a mutual fund, you own a small portion of the portfolio. Share prices of mutual funds change when the stocks or other assets in their portfolio rise or fall. The net asset value of a mutual fund is calculated daily after market close. You can only buy and sell mutual funds at this time. Mutual funds charge management fees for their services.
Related: best performing mutual funds
Mutual funds with active and passive management
When you invest in a mutual fund, a professional fund manager actively or passively manages your investment. Actively managed funds try to trade stocks at the right time. Passively managed funds invest in different index funds. Passively managed funds generally have lower fees than actively managed funds. Mutual funds charge early redemption fees if you sell quickly, which encourages a passive approach. Other types of mutual funds explained in more detail here.
Reasons to Invest in Mutual Funds
You should invest in mutual funds to diversify your portfolio because they are cheap to invest in and because they are beginner-friendly investment vehicles. Mutual funds are often part of retirement plans because they earn returns above the annual rate of inflation.
Based on our review, we consider Interactive Brokers to be the best trading platform in the UAE for mutual funds. They offer a great selection of different mutual funds, competitive fees, and no minimum deposit.