5 Top Online Stock Brokers
When it comes to research, Fidelity is in a league of its own. If managing your own portfolio is not of interest, all full-service brokers offer optional advisory services as well. Merrill Edge offers high-quality customer service, robust research and low fees. There is no one best online stock broker. Our experts suggest you begin by looking at your own life.
Platform & Tools
TD Ameritrade offers two best-in-class platforms, designed for two different types of investors. Both platforms are free to use for any investor with a TD Ameritrade account. The web-based Trade Architect, though often in the shadow of thinkorswim, is streamlined and easy to use. It will appeal to beginning investors, or anyone who prefers a simplified, educational interface. Its tab-based navigation lets users flip between trading tools and account overview, plus charts, stock screeners, heat maps, and more.
Since the company acquired Scottrade, our favorite platform for beginners, in , we predict it will continue getting better at serving junior traders. Thinkorswim, on the other hand, is a powerhouse designed for the advanced. This desktop application regularly racks up awards for its superior tools and features — research reports, real-time data, charts, technical studies.
Things any other broker would charge a premium for. Its Strategy Roller feature lets investors create custom covered calls and then roll those positions from expiration to expiration. TD Ameritrade has been a powerful player in the online stock trading ecosystem for years. The flipside to such robust platforms: TD Ameritrade remains one of the more expensive options out there, even with more than commission-free ETFs.
Though its pricing structure is more expensive than some of the other discount brokers, there are many traders who think its best-in-class trading platforms. If you already have a firm handle on your investment strategy and want to maximize your profits, OptionsHouse is excellent. What it lacks in some of the investor education features that competitors like TD Ameritrade can claim, it makes up with its low-cost, streamlined trading platform.
Along with competitive pricing, OptionsHouse has one of the most accessible platforms. Clean design and user-friendly tools help make heaps of information easier to digest. Trigger Alerts lets users set up their accounts to automatically purchase an order based on a particular scenario.
For example, you can set an alert to buy any number of shares of one stock if its direct competitor falls by a certain percentage. Tools like tradeLAB help dissect options spreads, with green smiley faces for the statistical probability of making a profit, and red frowns for a loss. Whether you prefer to trade via desktop, tablet, or mobile, its customizable interface seamlessly transitions between all three — though, admittedly, customers seem to either love or hate the app.
You can sort stocks by size, performance, and even criteria like sales growth or profit growth. Want to sort ETFs by the sectors they focus on, or their expenses?
When it comes to research, Fidelity is in a league of its own. The intellectually curious can dive into research from more than 20 providers, including Recognia, Ned Davis, and McLean Capital Management. They cover how to apply principles to your own Fidelity investments. Charting with Recognia requires a significant trades per year to use, and its Active Trader Pro requires 36 trades per year. Warren Buffett is the best example to hit this point home. Conversely, hedge funds stack management fees on top of trading fees to pay for the time and knowledge actual strategists are putting into your investments.
So what happened to the bet? Buffett won , and donated the winnings to charity. A stock broker is a person or an institution licensed to buy and sell stocks and other securities via the market exchanges. Back in the day, the only way for individuals to invest directly in stocks was to hire a stock broker to place trades on their behalf.
But what was once a clunky, costly transaction conducted via landline telephones now takes place online in seconds, for a fraction of what full-service brokers used to charge for the service. Today, most investors place their trades through an online brokerage account. TD Ameritrade makes up for higher-than-average trading commissions with better-than-average service, research and trading tools that will make everyone from beginner investors to active traders happy.
Merrill Edge offers high-quality customer service, robust research and low fees. Customers of parent company Bank of America will love the seamless, thoughtful integration, with a single login to access both accounts. E-Trade has long been one of the most popular online brokers, largely because of its easy-to-use tools. They offer a tiered commission structure that favors frequent traders but can add up to high costs for casual investors.
Want to compare more options? Here are our other category winners for best online brokers for beginners:. E-Trade has long been one of the most popular online brokers, largely because of its easy-to-use tools.
They offer a tiered commission structure that favors frequent traders but can add up to high costs for casual investors. Merrill Edge offers high-quality customer service, robust research and low fees. Customers of parent company Bank of America will love the seamless, thoughtful integration, with a single login to access both accounts. The lack of commission-free ETFs and mutual funds can be a turnoff to some investors. Interactive Brokers is a strong option for advanced, frequent traders: The broker offers international trade capabilities, low commissions and a quality trading platform.
New traders might be turned off by inactivity fees, high balance requirements and a lack of educational resources. Charles Schwab has earned its strong reputation: The broker offers high-quality customer service, two robust trading platforms and a wide selection of commission-free ETFs and no-transaction-fee mutual funds.
Here are more NerdWallet resources to answer other common questions about online brokerage accounts. How much money do I need to get started investing? Not much at all. Note that many of the brokers above have no account minimums. Once you open an account all it takes to get started is enough money to cover the cost of a single share of a stock and the trading commission.
How can I build a diversified portfolio for little money? One easy way is to invest in exchange-traded funds. ETFs are essentially bite-sized mutual funds that are bought and sold just like individual stocks on a stock market exchange.
Like mutual funds, each ETF contains a basket of multiple sometimes hundreds of stocks that adhere to a particular criteria e.