How to Invest in Shares Online in Australia (A DIY Beginner's Guide)

This guide walks through the whole process in plain English: what online share investing actually is, how much you need to start, the step-by-step of placing your first trade, and how to choose an online broker. It's general information to help you understand the mechanics — not advice about what to buy. And because investing always carries risk, we'll be upfront about that throughout.

What does it mean to invest in shares online?

A share is a unit of ownership in a company. Buy one CBA share and you own a (very) small slice of Commonwealth Bank. Shares in Australia are traded on exchanges — mainly the Australian Securities Exchange (ASX) and Cboe Australia — and you can't buy them directly on an exchange yourself. You need a broker with access to place the order for you.

An online broker is simply a broker you use through an app or website instead of over the phone. You research, place orders and track your portfolio yourself. This is what "DIY" or "self-directed" investing means: you make the decisions, rather than paying a full-service or advisory broker to make them for you.

DIY vs advised: which is which?

• Self-directed (DIY) online broking: You choose your investments and place trades yourself. Lower cost, full control, no personal advice provided. Selfwealth sits here.

• Full-service / advisory broking: A professional gives you tailored recommendations and places trades on your behalf. Higher cost, less hands-on.

• A licensed financial adviser: Provides personal advice that considers your circumstances — worth considering if you want guidance specific to your situation.

DIY suits people happy to do their own research and take responsibility for their choices. If that's not you yet, there's no rush — building knowledge first is sensible.

How much money do you need to start investing in shares?

There's no legal minimum to start investing in Australia, but a few practical numbers matter.

For ASX-listed shares, the minimum first trade is usually around A$500 — the "minimum marketable parcel". After that, top-up amounts are generally at the broker's discretion. ASX's own guidance has traditionally suggested starting with a bit more so brokerage doesn't eat into small parcels.

Here's why that matters. Brokerage is the fee you pay each time you trade. If you pay a flat A$9.50 to buy A$1000 of shares, that's 0.95% of your investment gone on fees. Put the same A$9.50 fee against a A$10,000 trade and it's just 0.095%. The smaller and more frequent your trades, the more the fee structure matters — which is why many DIY investors favour predictable, flat-fee brokerage over percentage-based pricing.

The takeaway: you can start modestly, but be conscious of fees as a percentage of what you invest, and only ever invest money you can afford to leave alone for the long term.

How to invest in shares online: a step-by-step guide

Here's the DIY process from a standing start to your first trade.

Step 1 — Choose an online broker

Your broker shapes your costs, which markets you can reach, and how you'll hold your shares. We cover exactly what to compare in the next section. Take your time here — switching later is possible but fiddly.

Step 2 — Open and verify your account

Applying online usually takes minutes. You'll need photo ID (driver licence or passport) and your personal details for identity verification, which is a regulatory requirement. You'll also choose an account type — individual, joint, company, trust or SMSF. The structure you pick has tax and estate implications, so if you're unsure which suits you, a registered tax agent or licensed adviser can help.

Step 3 — Fund your account

You can't buy shares until cleared money is sitting in your trading account. Common funding options:

• Osko / PayID — near-instant transfers between Australian bank accounts.

• Standard bank transfer — usually clears in 1–2 business days.

With Selfwealth, funds sit in a dedicated cash trading account with ANZ. Move money in first, wait for it to clear, then you're ready to trade.

Step 4 — Decide what to invest in

This is the research step, and it's yours to own. Two broad starting points many beginners consider:

• Individual shares — you back a single company. Higher potential reward, higher risk if that one company struggles.

• Exchange-traded funds (ETFs) — a single fund holding many shares (for example, the largest 200 or 300 ASX companies), giving instant diversification in one trade.

Neither is "better" in the abstract — it depends on your goals, timeframe and how much risk you're comfortable with. ASIC's Moneysmart has solid, unbiased background reading if you want to build your understanding first. This guide can't tell you what to buy — that's a personal decision.

Step 5 — Place your first order

When you're ready to buy, your broker's order screen will ask for:

• The stock code (ticker) — e.g. CBA, VAS, BHP.

• Quantity or dollar amount — how many shares, or how much you want to spend.

• Order type:

  • Market order — buy at the best available price right now.

  • Limit order — set the maximum price you're willing to pay; the trade only fills at that price or better.

Review the order, confirm, and it's placed. ASX trades settle on a T+2 basis — the shares and money officially change hands two business days after the trade date. Then the shares appear in your portfolio.

Step 6 — Review, and keep investing

Investing is a long game. Rather than trying to time the market, many DIY investors invest a set amount on a regular schedule — a strategy called dollar-cost averaging (buying at regular intervals so you average out your entry price over time). You can do this manually, or automate it. Selfwealth's Auto-Invest feature lets you set a stock, schedule and amount so contributions happen consistently without you logging in each time. Automating the habit is often what separates investors who stick with it from those who don't — though it's worth remembering that regular investing doesn't remove market risk.

How to choose an online broker (what to compare)

Not all online brokers are the same. Here's what actually matters for a DIY investor:

Brokerage and fees. This is the headline cost. Australian online brokers price in different ways — some charge a flat fee per trade regardless of size, some use tiered brokerage that rises with the trade value, some charge a percentage, and some advertise "zero brokerage" but earn revenue elsewhere, such as through a currency-conversion (FX) spread on international trades. None is automatically best; it depends on how you invest. Always check a broker's current fee schedule directly, since pricing changes. For reference, Selfwealth charges a flat A$9.50 per trade on ASX and US trades, with no account-keeping fees.

How you hold the shares (CHESS vs custodian). This is the point beginners most often miss — see the next section.

Market access. Do you only want ASX and Cboe shares and ETFs, or also US markets like the NYSE and Nasdaq? Check what each broker offers.

Account types. If you invest through an SMSF, trust or company — not just as an individual — confirm the broker supports it.

Platform and tools. A clear app, easy funding, and useful (not overwhelming) research make DIY investing far less daunting.

Do you actually own the shares? CHESS vs custodian

When you buy ASX shares, there are two main ways they can be held, and the difference is worth understanding.

• CHESS-sponsored (HIN-based): The shares are registered under your own Holder Identification Number (HIN) on the ASX register. You hold direct legal title — the shares are legally yours, with no custodian in between.

• Custodian model: The broker holds shares on your behalf, pooled under the broker's name. You hold a beneficial interest rather than direct legal title.

Direct HIN ownership is generally considered a stronger position, particularly in the unlikely event a broker runs into financial trouble. Selfwealth's ASX trades are CHESS-sponsored, so you get your own HIN and direct ownership.

One important caveat: CHESS applies to ASX-listed securities only. US and other international shares are typically held under different settlement and custody arrangements through a broker's international trading partner — that's standard across the industry, not unique to any one broker.

Common beginner mistakes (and the risks to keep front of mind)

• Putting everything in one stock. Concentration magnifies both gains and losses. Diversifying across companies or using an ETF spreads risk.

• Trying to time the market. Predicting short-term moves is notoriously hard. Consistent, regular investing tends to serve long-term investors better than chasing the perfect entry point.

• Ignoring fees on small trades. As shown earlier, brokerage as a percentage of a tiny trade can be significant.

• Investing money you might need soon. Share prices can fall as well as rise. Only invest what you can afford to leave invested for years.

Above all: investing carries risk, including the loss of the money you invest. Share prices rise and fall, dividends aren't guaranteed, and no platform, fee structure or feature — flat fees, CHESS sponsorship or automated investing included — removes that risk. Past performance of any share, ETF or index is not a reliable indicator of future returns.

Investing online with Selfwealth

If the DIY, self-directed approach appeals, Selfwealth was built for exactly that — "built by investors, shaped by feedback". You get:

• Flat A$9.50 brokerage on ASX and US trades, with no account-keeping fees.

• CHESS-sponsored ASX investing — direct ownership under your own HIN.

• Access to ASX and Cboe (thousands of shares and ETFs) plus US markets.

• Auto-Invest for hands-off, scheduled dollar-cost averaging.

• A free app and desktop platform, and account types spanning individual, joint, company, trust and SMSF.

New here? It's worth also reading our companion guide, How to Buy Shares in Australia: A Beginner's Guide, which covers the "what and why" of shares in more depth.

When you're ready to start, you can open a Selfwealth account online in a few minutes.

Frequently asked questions

How do I start investing in shares online in Australia? 

Open an account with an online broker, verify your identity, transfer and clear funds (via Osko or bank transfer), research what you want to buy, then place a market or limit order through the broker's app or website. ASX trades settle two business days later (T+2).

How much money do I need to start? 

There's no legal minimum, but the first trade in ASX shares is usually around A$500 (the minimum marketable parcel). Because brokerage is charged per trade, larger trades reduce the fee as a percentage of your investment.

Is investing in shares online safe? 

Reputable Australian brokers are regulated by ASIC and use security measures like two-factor authentication. But "safe" refers to the platform, not your returns — all share investing carries risk, and you can lose money. Nothing removes market risk.

What's the difference between CHESS-sponsored and custodian-held shares? 

CHESS-sponsored shares are registered under your own HIN, giving you direct legal ownership on the ASX. Custodian-held shares are pooled under the broker's name, so you hold a beneficial interest rather than direct title. CHESS applies to ASX securities only.

Can I invest in US shares online from Australia? 

Yes. Many Australian brokers, including Selfwealth, offer access to US exchanges like the NYSE and Nasdaq alongside the ASX. International shares are usually held under different custody arrangements than CHESS.

Do I pay tax on shares? 

You may have tax obligations on dividends and on gains when you sell (capital gains tax). Tax depends on your circumstances and this guide isn't tax advice — check ASIC's Moneysmart or speak with a registered tax agent.