Choosing The Best Online Stock Broker For Your Trading Needs
A good online stock broker is one who can provide you an efficient and reliable trading platform at a low cost. But before you decide on a broker who is right for your trading needs, you’ll also have to outline your investment goals and think about the trading pattern that you want to follow.
If you are likely to trade occasionally and invest in low risk instruments with a long-term horizon, then you should look for a safe and reliable service, even of you have to pay a slightly higher fee. On the other hand, if you are a short term investor and you are going to trade frequently, then the commission that the online stock broker charges and the speed of the trading platform should be the most important criteria.
Many discount brokers do not give investment advice as they charge a smaller commission. What they give you is a cost-effective, no-frills trading platform where you can place online buy and sell orders for a small fee. However, some discount brokers have now started offering research services through their partners.
Top discount brokers
E*Trade: E*Trade was voted Smart Money’s best online stock broker in 2009. With a cost per trade of around $7.99 per trade for 150+ trades per quarter and $9.99 per trade for less frequent traders, E*Trade is reasonably priced. A major benefit of E*Trade is its exhaustive range of investment options. With an E*Trade account, you can invest in mutual funds, stocks, bonds, ETFs and a number of other complex financial instruments.
Thinkorswim: It was chosen as the best broker by Barron’s recently, primarily because of its highly efficient platform and the large number of tools that it offers. These tools give you much greater visibility into historical trends and real time data. It offers flat fee trading at $9.95 per trade, or you can go for the volume based pricing at $.015 per share.
OptionsHouse: This one offers trades at $2.95, a price that is hard to beat. However, the site is too focused on options trading, and if you are just looking for regular stock trading, it might not be the right online stock broker for you.
Scott Trade: It offers $7 online stock trades and brings some research and financial market updates to the table. The company has a solid 30-year track record and numerous satisfied customers. It guarantees zero hidden fees and transfer fees.
TradeKing: Very economically priced at less than $4.95 per transaction, TradeKing is a good option for frequent traders. The company does not have any minimum account limits or differential rates according to account sizes, which makes it ideal for new investors who want to take it slow initially.
There are many other online stock brokers who offer a wide range of services and are cost-effective at the same time. Study detailed comparison charts carefully before you choose your online broker so that it satisfies the specific criteria that you are looking for. Online resources like Smart Money and Barron’s will give you detailed reviews on all aspects of leading brokers.
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