|Preferred Broker||Popular Feature||Commissions||Minimum||Special Offers|
|$9.99 online stock trades||$0||Trade free for 60 days and get up to $600 cash.|
|$2,500||Top related research tools.|
|Low Cost||$9.99||$500||Trade free for 60 days, plus get up to $600|
|Market Insight||$7 online stock
|Trading Knowledge||$8.95 per online equity trade.||$0||Earn up to 300 commission-free online trades. Get Details.|
Choosing an Online Broker
Brokerage firms compete based on several different features. In a recent survey, the features most valued by The Street readers were:
There is more to low costs than just low commissions. In fact, depending on your trading style, commission fees might be down the list when it comes to overall costs. For investors who maintain a cash balance in their account features like competitive interest rates or free checking are appealing. Conversely, those who use margin accounts for leverage will be impressed by low borrowing costs on their margin accounts offered by brokers like Scottrade.
User Interface Features
The E*TRADE baby commercials are a good example of how a broker's user interface can make a difference: "So simple a baby can use it". User interface means more than just how the web site looks. It can include everything from how easy it is to compare statistics to ease of use of the smart phone app. you know, the one that gives they E*TRADE baby a way to stay connected during "down time".
When a brokerage firm fails it can be catastrophic for its customers. Even if assets can be recovered the process can take months or even years wreaking havoc on other financial obligations. The minimum you should expect from your broker is that they are insured by the Securities Investor Protection (SIPC). SIPC covers your account up to $500,000 ($250,000 cash, the rest securities) in the event of insolvency or unauthorized trading. Some investors specifically choose brokers like Fidelity for their financial stability. Fidelity's first priority is to protect over $3 trillion in assets that have been entrusted to them by investors.
What is research? To some it is stock screening tools, some care more about analyzing their portfolios. Still others prefer research reports written on companies and industries as Schwab provides. If you want a little help generating trade ideas check which research tools are provided by a broker before making your decisions.