The Online Broker can be full service to deep discount.
Both types of brokers offer many services and tools online. As we continue, you will learn more about these tools and how they pertain to the penny stock trader.
Full-service brokers still have much more human to human contact by phone, chat, and in the office, then do discount brokers.
Broker Fees and Services
Phone assistance, online trading, training aids and educational material, a variety of trading tools, and even chat and message services are available from many online brokers. Many also offer IRA account services, checking, credit card, mobile apps, etc. Broker fees very widely for services offered.
This topic is only concerned with those services essential for trading stocks - for gaining wealth. IRA, checking, credit card, mobile apps, and other fringe services that surround the trading of stocks are not considered in the search for the best penny stock broker - at least not at first.
Once the basics are covered, and we have narrowed our search down to the best penny stock friendly brokers - only then do I suggest you look at the fringe benefits of each, and then make your best choice.
The saying goes, "You get what you pay for." But that saying does not pertain to your search for online brokers.
Heated competition between stock brokers translates into outstanding broker features at minimal cost.
Depending on the services offered, online brokers can be more like full service brokers offering more broker-client contact, and a full selection of many types of high quality online trading options and resources not quite matched by truly discount broker.
Some discount brokers really shine though.
This really depends on your needs too. If you are low-maintenance or more independent, and enjoy doing your stock research from free online sources, then some of the discount brokers provide equal to or better quality tools than most full service brokers. I will show you which discount brokers really shine as you continue these lessons under the topic: Penny Stock Broker
Categories of Online Brokers
Considering the varying degrees of services offered, such brokers can be either
Some of the best High end discount penny stock friendly online brokers are:
T. Rowe Price: 19.95 per trade with $5000 opening balance
TD Ameritrade: $9.99 per trade with $0 opening balance
E-TRADE: $9.99 per trade with $500 opening balance
OptionsXpress: $8.95 per trade with $0 opening balance
Charles Schwab: $8.95 per trade with $1000 opening balance
Study the conditions and hidden fee structure to qualify for the deepest discounts.
Study the tools and services offered.
Study the customer reviews.
After your study is complete, ask yourself if your choice broker is worth it for you considering your trading goals.
I will say this though, if you are primarily using your broker account just to trade stocks and make money, you will avoid many of the noxious fine print (hidden) fees.
Huge overlap in stock broker categories in past 5 yrs
In the past 5 years, most truly discount brokers are offering increasingly more services comparable to the more high end online brokers at discounted fees.
Increasing number of discount brokers are even offering very cheap or free phone call assistance and broker assisted trades.
Likewise, to compete with the discount brokers, many high end online brokers like Charles Schwhab, Fidelity, and even TD Ameritrade have become true discount brokers.
The competition is high. Benefits to the average trader have never been better.
Read the fine print!
Be careful in your search. Read the fine print for hidden fees and conditions, and see if your trading goals fall victim to those fees.
If you are using your trading account to just make stock trades and
then most hidden fees and conditions will not apply to you.
Fees to Essential Trading Services
The only fees you really want to consider are extra charges for penny stocks. These are brokers You want to avoid because they are not friendly for penny stock traders. More details will be given in the upcoming subtopics.
Search for the Best Penny Stock Brokers
We will continue our search for the penny stock friendly brokers. Then choose the best of the best of those brokers that most closely meets your tastes and goals.
You have completed this topic on Online Brokers.
When you are ready, please continue on to the next lesson: