Stock trading and brokers
Some online stock brokers are known for their award-winning customer service while others are known for inexpensive stock trades or powerful trading tools. This guide will highlight some of the best brokers available today with tips and advice for choosing a broker. Its platforms thinkorswim was 1 desktop platform , tools, mobile apps including Alexa Skill and Facebook Messenger bot , research, customer service 1 for phone support , and education 1 are all award winning.
Get up to free trades for 2 years. Fidelity is best known for its value driven customer experience. Beyond cost and ease of use, Fidelity also finished 1 for research tools. OptionsHouse has been rated the 1 platform for Options Trading the past seven years.
Merrill Edge is the online broker of Bank of America and is available to all investors, regardless if they are a current BofA customer. Like TD Ameritrade and ETRADE, Merrill Edge is well-rounded; however, it has a huge advantage over all other brokers thanks to its Preferred Rewards program where customers can earn free trades, credit cards bonus cash back, priority customer service, and more.
I have personally been using the program since it launched in With its competitive commission rates for stocks and options trading, investors who have previous market experience will find themselves right at home. However, unless you are already an Ally customer, you will find that there are better offerings available. Having the best stock broker to serve individual needs is very important for any investor.
For example, cheap trades most often come at the expense of less research tools and a more simplified trade platform. Consider these 12 key factors to help compare all stock brokers and ultimately find the best broker to suite your needs. Trade Commissions What does it cost to buy shares of stock? Does the fee change based on the type of order or size of order?
To keep it simple, look for brokers that offer flat-fee trades, ie charging a flat rate regardless of the type, price of the stock, or size of the order. Customer Service When picking up the phone or emailing a broker, is a well trained customer service representative ready to assist? How any investor is treated as a client is more important to some than others. Trading Tools Trading successfully is a lot easier when investors have great tools at their disposal.
A top stock broker should offer access to a wide variety of trade tools to help make the most of each and every trade. From real-time streaming quotes to last sale tickers, quality stock scanners, mobile trading apps, and level II quotes to name a few. Strong tools are essential for active investors.
Brokerage firms serve a clientele of investors who trade public stocks and other securities, usually through the firm's agent stockbrokers. The staff of this type of brokerage firm is entrusted with the responsibility of researching the markets to provide appropriate recommendations, and in doing so they direct the actions of pension fund managers and portfolio managers alike. These firms also offer margin loans for certain approved clients to purchase investments on credit , subject to agreed terms and conditions.
Traditional brokerage firms have also become a source of up-to-date live stock prices and quotes. A discount broker or an online broker is a firm that charges a relatively small commission by having its clients perform trades via automated, computerized trading platforms rather than by having an actual stockbroker assist with the trade.
Most traditional brokerage firms offer discount options and compete heavily for client volume due to a shift towards this method of trading. Other ways to lower costs for these brokers is by executing orders only a few times a day by aggregating orders from a large number of small investors into one or more block trades which are made at certain specific times during the day.
They help lower costs in two ways:. Since investor money is pooled before stocks are bought or sold, it enables investors to contribute small amounts of cash with which fractional shares of specific stocks can be purchased. This is usually not possible with a regular stockbroker. Many broker-dealers also serve primarily as distributors for mutual fund shares. These broker-dealers may be compensated in numerous ways and, like all broker-dealers in the United States, are subject to compliance with requirements of the US Securities and Exchange Commission and one or more self-regulatory organizations , such as the Financial Industry Regulatory Authority FINRA.
The forms of compensation may be sales loads from investors, or Rule 12b-1 fees or servicing fees paid by the mutual funds.