Whats a good online stock broker?

Question

I only have about $500 to invest, and my strategy calls for frequent trades. I don't need help looking for stocks or doing much research. Also, this will be the first time that I've ever traded online. Thanks for your help guys!

I only have about $500 to invest, and my strategy calls for frequent trades; generally penny stocks. I don't need help looking for stocks or doing much research. Also, this will be the first time that I've ever traded online. Thanks for your help guys!

Sory, new to this. What I wanted to add on there was that I generally do frequent, high volume, penny stock trades.

Answer 1

There are a lot of good brokerages depending on what you like and how you trade.

Barron's has a great article on brokerages that they publish each year. (Latest one was in March 6, 2006 though the 2007 article “just” came out). Kiplinger does one too.

Here’s the link to the 2006 Barron’s article.
http://webreprints.djreprints.com/1550280182488.html

Here’s the link to the new Barron’s 2007 – Best online Brokers 3/5/07
http://online.barrons.com/public/article/SB117288684364425609-wsYkdd74F9ukYSQgQJifDpHYwsY_20070402.html?mod=mktw

Here’s the link to the Kiplinger’s July 2006 article which isn’t bad either.
http://www.kiplinger.com/magazine/archives/2006/07/brokers.html


For basic stuff, E*Trade, Ameritrade, and Scottrade are sufficient. For more complex trades, I'd recommend Optionsxpress, ThinkorSwim, or interactivebrokers.

Based on what you put in your question, I'd recommend one of the first three, but all are very good. Cheapest probably is scottrade (of the larger online firms). Yes there are cheaper like interactivebrokers, but you'll have to get used to their software based platform (which is doable). They're only about $1/contract on options!

Brokerages like Fidelity are horrible for anyone with any decent experience. They can do basic buy and sell orders, but beyond that, they’ve got to be one of the worst “top” brokers out there. Not only are most of their customer service staff ignorant in what many transactions are, but their fills are usually slow, the statements are unusable (based on “last transaction vs. current conditions!!!), and they take forever to resolve any issues. That said, for BASIC buy and sell orders, they’re not too bad. It’s just a matter if you want to be with a broker that can grow with your experience.

So, decide what's important to you as a trader and compare the brokers! You can use the article, or go to each website as they all seem to have comparison charts!

And if there are particular things that you want to mention as being most important to you (such as executions, cust svc, cheapest trade - which you mentioned, flexibility on allowing you to do certain types of trades, stop and stop limit orders, contingent orders, great graphing, what if scenarios, training, etc), I'll be glad to help discuss this with you too!

If you have any questions, let me know.

Hope that helps!

P.S. I just found a link to a review of reviews as well! Here it is:
http://www.consumersearch.com/www/internet/online-brokers/reviews.html

Motley fool also does a small comparison of the “cheap” firms. Here’s that link.

http://www.fool.com/dbc/tables/compare.htm?source=ifldbcdbx0000001

Answer 2

It depends on your needs. Interactive brokers is very good. Cheap fees, and the higher volume you trade (more shares) over a period of time, it gets cheaper. You also have the option to put in orders directly to the exchanges, and you can get rebates in some cases (adding liquidity on the nasdaq) which will pay you money for putting in a bid or an offer, which will either make your trade cheaper, free, or even make you some money on it! Some brokers can be better, it depends on if you have other types of needs. Whatever you do though, do no go with a bank, eg. TD Waterhouse, their fees are criminal. I hope this helps, good luck.

Answer 3

You'll have to check on their account minimums, but Barron's (weekly financial newspaper of Dow Jones) rated thinkorswim and OptionsXpress most highly in the last couple of annual surveys of online brokers.

I prefer Interactive Brokers, especially for frequent trading, since their commissions on stock are only a half cent per share, with $1 minimum on a trade, and you can trade any number of shares you want. So, buy 100 shares at $30, and pay only $3,001 including commission. Or, buy 10 shares at $15, and pay only $151 including commission. But they require $5,000 to open an account, so you may have to build up your capital first. (The account maintenance requirement is less.) By all means, take a look at them if you want cheap commissions and excellent execution.

Answer 4

Charles Schwab.

www.schwab.com

Answer 5

first of all newbie read this BEFORE even considering the penny garbage

http://www.pinksheets.com/about/pr_041207b.jsp

$500 is not even remotly close to getting involved with this garbage. You have been warned!

Answer 6

Firstrade was rated #1 by consumer reports. I have a Firstrade account. No complaints.

Answer 7

E-trade is the one I use. Low prices to buy and sell, and decent reviews, although you said you didn't need it...