How to Start Trading in Germany

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1. Meet the Basic Requirements

You will need:

  • Valid ID (German national ID, passport, or residence permit)

  • German residential address

  • German tax ID (Steuer-ID)

  • Bank account (IBAN) in your name, preferably a German bank

  • Smartphone or computer with internet access

 2. Open a Trading and Custody (Depot) Account

To buy and sell stocks, you’ll need a:

  • Trading account (to place buy/sell orders)

  • Depot (custody account) to hold your shares

👉 Popular brokers in Germany:

  • Trade Republic – Low fees, app-based

  • Scalable Capital – ETFs, stocks, and savings plans

  • DEGIRO – Great for active traders

  • Smartbroker

  • Comdirect, Consorsbank – Traditional full-service banks

Tip: Choose a broker with low commissions and user-friendly app if you’re a beginner.

 3. Verify Your Identity (PostIdent / VideoIdent)

German brokers require KYC (Know Your Customer) compliance:

  • Either VideoIdent (video call with your ID)

  • Or PostIdent at a local post office

This is a legal requirement to activate your account.

 4. Learn the Basics of Stock Trading

Before risking real money:

  • Understand key concepts like:

    • Shares, ETFs, Indices (DAX, MDAX, S&P 500)

    • Order types: market, limit, stop-loss

    • Dividends, capital gains, risks

  • Resources:

    • Scalable Learn Hub or Trade Republic Academy

    • Finanztip.de – trusted German personal finance site

    • YouTube Channels like Finanzfluss (German), or English ones like Rayner Teo, Graham Stephan

 5. Deposit Funds into Your Broker Account

Once verified, link your German bank account (IBAN) and deposit money via SEPA transfer or instant transfer (some apps support Apple Pay or Sofort).

 6. Start Trading or Investing

You can trade:

  • Stocks (e.g., DAX, NASDAQ, etc.)

  • ETFs – Popular in Germany due to low tax and ease

  • Fractional shares (on apps like Trade Republic or Scalable)

  • Savings plans (Sparpläne) – Automate monthly investments in stocks/ETFs

  • Crypto (offered by some brokers like Trade Republic)

 7. Understand German Taxation

  • Capital gains tax: 25% flat (Abgeltungssteuer) + Solidarity surcharge + church tax (if applicable)

  • No tax on profits up to €1,000/year (Freistellungsauftrag)

  • Most German brokers automatically deduct taxes

Tip: Set up a “Freistellungsauftrag” with your broker to use your tax-free allowance.

 Bonus Tips

  • ✅ Start with ETFs or blue-chip stocks (e.g., DAX 40)

  • 📉 Use limit orders to avoid overpaying

  • 🚫 Avoid penny stocks or leveraged products in the beginning

  • 🧾 Keep records for tax filing (most brokers provide annual summaries)

  • 🔒 Enable 2FA (two-factor authentication) for your account

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