Summary
France has a rich history as one of the early countries involved in the trading of financial instruments. In 1540, Lyon was the center of commodity exchange between investors, way before investors started trading stocks in London in 1698. Today, France is the 7th largest economy in the world, and Euronext Paris, France’s largest stock exchange, is the 2nd-largest stock exchange in Europe.
Euronext Paris is part of Euronext, a pan-European trading exchange that also comprises overstock exchanges in Amsterdam, Brussels, Dublin, Lisbon, Milan, and Oslo. Top companies like LVMH (Louis Vuitton, Moet, and Hennessy), L’Oreal, Hermes, Christian Dior, and Sanofi are listed on the Euronext Paris stock exchange.
Investors interested in buying shares in France are not limited to the local stock exchanges within the country. All investors living in France can access global stock exchanges like the New York Stock Exchange, NASDAQ, London Stock Exchange, etc, and buy stocks from companies listed on them through stock brokers. Stock brokers offer access to French investors who wish to buy stocks from global stock exchanges. While this is a good thing, many stock brokers aren’t worth trading with.
This guide will look at how to buy shares in France by going through all the characteristics you should look out for when choosing a stock broker; like the account opening process, trading platforms available, fees, and commission. We will also look at some of the best shares to buy as an investor in France. Finally, we will go through some opinions from investors in France by looking at two main social communities (Reddit and Quora) and discuss some frequently asked questions.
To buy shares in France, you can register with one of the brokers listed in the table above. To do this, follow these steps:
- Select a Broker
- Create an Account
- Deposit Funds
- Search for Shares
- Buy the Shares
- Monitor your Portfolio
If you live in France, you have access to different stock markets in France and all around the world. The biggest stock exchange in France is the Euronext Paris (or the Paris Stock Exchange), and there are over 800 companies listed. However, you can also trade in the New York Stock Exchange, NASDAQ, London Stock Exchange, etc. with the right broker.
Some of the stock markets available for trading in France are:
Euronext Paris
Euronext Paris was founded in 1724 as the Paris Bourse, a name it retained until the year 2000 when it merged with the Amsterdam, Lisbon, and Brussels exchanges to form Euronext NV. Over 800 companies are listed on this stock exchange, giving it a market capitalization of over 4.29 trillion € ($4.58 trillion). This makes it the second-largest stock exchange in Europe, behind the London Stock Exchange.
Among the top companies listed on Euronext Paris are: LVMH, Hermes, Schneider Electric, L’Oreal, and Air Liquide.
New York Stock Exchange
The New York Stock Exchange (NYSE) is the largest stock exchange in the world by far. Most of the world’s biggest companies are listed on the New York Stock Exchange. They include Tesla, Coca-Cola, Microsoft, PepsiCo, and many others. It has a market capitalization of over 28 trillion € ($30 trillion) and an average daily trading volume of 140 billion € ($150 billion). Traders in France can access all 2,578 companies in the NYSE by choosing a competent broker like the ones in the table above.
NASDAQ
NASDAQ is the second-largest stock exchange in the world, just behind the NYSE. It is also located in the United States and has over 3,500 companies listed. Companies listed on NASDAQ include Berkshire Hathaway, NVIDIA, Tesla, Google, and Coca-Cola. It has a market cap of 17.79 trillion € ($19 trillion) and is available to investors in France and many countries around the world.
London Stock Exchange
The London Stock Exchange (often referred to as LSE) is the largest stock exchange in Europe and the 11th-largest in the world. It is located in London, United Kingdom, and has a market cap of 2.62 trillion € ($2.81 trillion). Companies listed on the London Stock Exchange include Toyota, General Electric, GlaxoSmithKline PLC, HSBC Holding, and Shell.
Madrid Stock Exchange
The Madrid stock exchange is a significant stock exchange situated in Europe, more precisely in Spain. It is considered one of the world’s oldest stock exchanges, and it serves as the base for several major Spanish companies such as Banco Santander, Telefónica, Repsol, and Inditex (which owns the popular brand, Zara).
Hong Kong Stock Exchange
The Hong Kong Stock Exchange is a prominent global stock exchange, ranked seventh in terms of market size, boasting a market capitalization exceeding $4 trillion. It is the headquarters of numerous colossal corporations, including Tencent Holdings, China Mobile Ltd, and CK Hutchison Holdings Ltd.
Euronext
Euronext is an enormous stock exchange located in Europe and is recognized as the largest bourse in the region. It came into existence in 2000 after the merging of the Amsterdam, Brussels, and Paris exchanges. Euronext has since grown significantly by merging with and acquiring other stock exchanges, including those in Dublin, Brussels, and Oslo. More recently, Euronext obtained the Borse Italiana from the London Stock exchange, further increasing its market capitalization.
When buying shares in France, you have to pay some fees to the broker you choose to trade with. These fees may come in the form of trading or non-trading fees, and they vary depending on the broker. Some fees you are likely to come across when you buy shares in France include:
Spreads
Spreads are the differences between the bid and ask prices of a commodity. Brokers often add a little markup to the prices of different securities to make some profit for market making. Spreads differ from one broker to another, so it is important to check the broker’s website to see what their spreads are before you purchase stock through them.
Commission
Some brokers like Degiro and Hargreaves Lansdown charge you a commission if you trade on their platform. However, there are many other commission-free brokers like Capital.com and eToro who do not charge this fee when you trade with them.
Deposit and Withdrawal Fees
These fees are often paid when you make deposits or withdraw money to and from your trading account with brokers. Some brokers do not charge these fees, so check the specific broker website you wish to trade with. For example, eToro charges $5 for withdrawals and nothing for deposits.
Inactivity Fees
Some brokers charge you a fee for leaving your trading account dormant for a long period, like 6 months or more.
Currency Conversion Fee
Brokers often charge you a fee when you deposit or withdraw funds in a currency different from the account’s base currency. For example, eToro charges a small fee for any deposit and withdrawal transaction that is not USD.
Overnight Fees
You might pay some overnight fees if you hold a position overnight when using most brokers available today.
Buying shares while living in France has some advantages and disadvantages, and we have listed the major ones here:
Pros
- Investing in a Country with a Strong Economy
- Wide Range of Stable and Profitable Companies to Invest in
Cons
- Investing Fees
Choosing the broker to invest in is just as important as choosing the right investment strategy. A good broker with the right customer service, regulations, educational materials, etc. can help you get more success in share trading than a broker without any of these characteristics.
When selecting a broker, there are different characteristics you should look out for. Some of them are:
Regulation
A well-regulated broker is much safer than an unregulated one. Regulations in the financial industry help monitor broker activities and act as an insurance policy for traders. Regulations state how brokers should handle traders’ finances and in most cases mandates companies to keep money aside as insurance in the event that they go bankrupt.
Depending on the country you live in, there are different financial regulatory bodies. In the US, bodies like the NFA and the SEC mostly regulate stock brokers. In Australia, the main regulatory body is ASIC. In France, the main body in charge of regulating stock brokers is The Autorité des Marchés Financiers (AMF) or “Financial Markets Authority” in English. Check that your broker is regulated by this body before you can start trading with them.
Markets
As discussed earlier, a stock market or exchange is a place where different companies list their stocks for sale. The broker itself is not a stock exchange, but a means to connect to the biggest stock exchanges in the world. Check that your broker can give you access to the Euronext Paris exchange, NYSE, NASDAQ, London Stock Exchange, and other important stock exchanges you wish to trade in.
Platforms
A trading platform is a piece of software used by brokers to connect traders to stock exchanges. Nowadays, proprietary trading platforms are getting increasingly popular, with brokers like eToro and Capital.com forming their own proprietary trading platforms exclusively for traders who register with them. These platforms have the advantage of being more flexible than other widely-used and popular trading platforms that are open to everyone.
On the other hand, there are widely used and open trading platforms that most brokers use to give traders access to the stock market. Examples of these trading platforms include MetaTrader (MT4 & MT5) and cTrader. Before you choose a broker, check that the broker has the trading platforms you wish to use.
Offering
Before choosing a broker for buying shares in France, it is important to find out the type of stocks they are offering. Some brokers offer real shares, while others offer CFDs. Contracts for Difference or CFDs are contracts between brokers and traders that allow the trader to place trades on the future position of an asset. This way, a trader trades on whether a particular stock will go up or down and earns a profit if the stock goes as predicted. Although, trading CFD is considered to be very risky.
Depending on your trading needs and strategy, you may desire a CFD or a real stock. Brokers like eToro offer both real stocks and CFDs to their registered traders, while Capital.com offers only CFDs to traders. Do your research to find out what your broker is offering before you choose to trade with them.
Trading Commission
Brokers often charge traders a commission for trading with their platform. This commission is often a percentage of the amount you actively trade. If you don’t like this commission-based model, you can opt for a commission-free broker like eToro and Capital.com and cut down your trading costs.
As mentioned earlier, a trading platform is a piece of software that offers access to traders willing to trade a stock market. Trading platforms offer more than just access to the stock market. They also offer tools needed for fundamental and technical analytics like charts, news, trends, etc.
All popular trading platforms can be divided into two classes: Proprietary trading platforms and open trading platforms. Proprietary trading platforms have grown in popularity in recent times and are now becoming the favorite choice for many. We will go through what proprietary trading platforms mean and also go through MetaTrader 5, one of the most popular and widely-used trading platforms.
Proprietary Trading Platforms and Apps
Proprietary trading platforms are platforms owned by brokers and fully exclusive to traders registered with that broker. It has the benefit of being more flexible than other widely-used trading platforms. Brokers like eToro and Capital.com have proprietary trading platforms for traders registered to them.
Proprietary trading platforms are available on different devices like mobile phones, tablets, and personal computers in the form of applications. There are also web versions of these platforms for people who don’t want applications on their devices. Brokers like eToro and Capital.com have proprietary trading platforms for their registered traders.
MT5 Platform & App
MT5, short for MetaTrader 5, is one of the most widely-used trading platforms in the world. It is a trading platform under the MetaTrader company, which also has the MetaTrader 4 or MT4. MT5 provides great charts, tables, a clear activity dashboard, data visualization, and other important trading features. It is a great improvement on the MT4 trading platform.
It is available on all kinds of devices, like mobile phones, tablets, and personal computers in the form of applications. If you prefer to use the web version, you can start trading on your browser through your broker’s server. MT5 is the preferred trading platform for shares as it offers traders access to all the stocks available on the broker.
The Paris Stock Exchange has a long list of high-value companies worth many billions of Euros. You are more likely to have a stable investment when trading stocks of high-net-worth companies, although this is not guaranteed. Examples of good high-value shares to buy in France include Total Energies, LVMH, Schlumberger, Hermes, and Danone. Most of these companies shares have grown or remained stable over the years, making them viable investment options.
However, traders in France are not limited to shares in the Euronext Paris stock exchange. They can access other stock exchanges like the NASDAQ, NYSE, LSE, and other Euronext stock exchanges.
Good stocks to buy from the NYSE and NASDAQ are Tesla, Amazon, Apple, Facebook, etc. Apple stocks have grown historically over the years, and they pay good dividends for a company that big. In addition, they have a lot of cash in hand, meaning more stability. They also have a wide range of investment in other services which will likely bring in better profitability in the years to come.
Traders in France should consider these stocks depending on their trading goals and strategies.
Traders in France are taxed when they make a profit by selling their shares. The capital gains tax is applied to the profit after the stock is sold. In France, traders are subject to a 30% capital gains tax on their stock profits. This capital gains tax comprises income tax (8%) and social security contribution (20%). This flat tax is called Prélèvement Forfaitaire Unique or PFU.
However, capital gains tax can be exempt if you are covered by equities (Plan d’Epargne en Actions or PEA) or an employee savings plan.
We went through two important social communities, Reddit and Quora, to learn what they thought about buying shares in France.
Reddit, known as the front page of the internet, is one of the largest social communities in the world with over 500 million users known as Redditors. Redditors use the platform to share important advice and information about everything ranging from software to personal finance. We went through a few threads here to see what traders thought about buying shares in France.
On one thread, a Redditor asked if they could find a good online broker where they could buy shares in France. In response, one Redditor said that the best online broker they knew was one called Boursorama. According to this Redditor, every new trader looking to register with this stock broker had to pay 300 € to register.
On another thread, we found a Redditor who wanted more information on how they could invest tax-free in France. According to them, they just moved in from the UK and were used to trading using the ISA, a trading account that allowed people in the UK to invest in mutual funds tax-free up to £20k. They wanted to know if there was a French alternative to the ISA for them to trade with in France.
One Redditor explained what the PFU (Prélèvement Forfaitaire Unique or flat tax) tax in France is, and the different breakdowns of PFUs available. The Redditor also explained that there were three other ways to invest in ETFs and mutual funds apart from company savings plans – Life Insurance, PEA (Plan d’Epargne en Actions or Equity Savings Plan), and PER (Plan Epargne Retraite or Retirement Savings Plan). He extensively explained the advantages and disadvantages of life insurance and PEA plans and said that the PEA was similar to the ISA (Individual Savings Account) in the UK. Finally, he explained that it was unnecessary to learn about the PER unless you were interested in retiring in France.
Quora
Quora is another important social community where users share ideas about a wide range of topics. We went through posts and comments on this platform to see what users thought about buying shares in France.
In the first post, we found, a Quora user asked how they could invest in Apple stocks while living in France. Another Quora user responded to him, explaining how he needed to register with a trustworthy broker and open a brokerage account. He also explained that some brokers might not accept French clients, so the Original Poster (OP) had to take that into consideration. He also advised the OP to choose a broker with similar philosophies about stock trading.
Another user responded by telling the OP to choose a broker like Interactive Brokers (IBKR) to trade with while in France. He also told the OP to check for the Apple stock on NASDAQ and look out for the AAPL ticker symbol when buying the stock.
Bottom Line
France is an economic powerhouse, being the 7th-largest economy in the world, and having a stock market worth more than $2 trillion. The Paris Bourse has companies like Hermes, LVMH, Schlumberger, L’Oreal and Schneider Electric listed on it. These companies, worth billions of dollars, are attractive options for people looking to buy stocks in France. However, French investors also have access to even bigger stock exchanges like the London Stock Exchange, NASDAQ, and even the NYSE.
If you are confused about how to buy shares in France, the first thing you need to do is register with a good broker and open a brokerage account to trade on Euronext Paris and other stock exchanges accessible to French residents. Before you select a broker, it is important to go through a list of characteristics to look out for. Look at the offerings of the broker (CFD or real stocks), trading platforms available, broker regulation, fees and commissions you have to pay, and customer service.
Some of the best shares to look out for when investing in France are LVMH, Danone, Tesla, Apple, Amazon, Schlumberger, and many others. Also, it is important to know how shares are taxed in France before you start investing there. Most capital gains are taxed at a 30% flat tax rate, except you are covered by equity (Plan d’Epargne en Actions or PEA) or an employee savings plan.
Q & A
Some of the best stocks to buy in France are LVMH, Hermes, Tesla, Amazon, Apple, Danone, Schlumberger, and L’Oreal. You can purchase them from the Euronext Paris Stock Exchange or other stock exchanges like NYSE and NASDAQ
You can buy penny stocks through brokers like Capital.com and Interactive Brokers. Other penny stock brokers like Charles Schwab and Robinhood aren’t available in France, and eToro doesn’t offer penny stocks.
To buy shares online in France, you need to register with a broker that offers you access to the stock exchange where the stock you want is listed. Then search for the stock using its ticker symbol and buy the amount you want.
Yes, you can buy stocks to hedge against domestic inflation.
To buy Tesla shares, you need to register with a broker like eToro that offers you access to NASDAQ. Then search for the Tesla ticker symbol (TSLA) and purchase the number of shares you want.
Yes, you can invest in international stocks from the USA, UK, Germany, Netherlands, Canada, and many others while living in France.
Some companies with great shares to buy now include Amazon, Walt Disney, Tesla, and Berkshire Hathaway.
Yes, you can buy and sell shares in France with a regulated broker.
Some brokers with great stocks to select from in France are eToro, Capital.com, Interactive Brokers and Trading 212.
Yes, you can buy shares with margins in France.
The top shares on Euronext Paris are LVMH, Christian Dior, Hermes, AXA, and Danone.
Beginners can start trading/buying stocks by registering with a broker that offers a demo account. They can trade with a virtual account until they feel confident enough to trade on a real account.
To buy the shares of a company, you need to find out the stock exchange the company is listed on. You can do this with a simple Google search. After this, find a broker that offers access to that stock exchange and register with them. Then search for the company using the broker app or platform and buy the number of shares you want.
Yes, you can sell shares on brokers in France.
