The HowTheMarketWorks Recommended Stock Brokers
So you’ve been using your investing practice account on HowTheMarketWorks for a while, maybe even participated in a couple of our monthly challenges, and are thinking of opening your own brokerage account. Great, the best time to start investing is now! If you can start putting aside a little bit of money every month to your investments, before you know it your seed money can start growing. The longer you wait, the more growth you might miss out on. Here we have a few recommendations for new investors who are just starting to invest real money in the markets.
Tips Before You Open Your Account
- Its always a good idea to practice first, just so you know what you’re getting in to. We always recommend new investors open a free paper trading account to practice before risking any of their real money.
- Choose the best broker for your needs. We have a collection here of the best brokers we can find based on consumer reviews and our own experiences, so this can be a great place to start. But even in this collection there is some differences in services, so take a look at our descriptions to see which is best for you.
- Start Small. Most brokers have a minimum deposit, so start out with that. Make a few investments with your initial deposit, and add more cash over time as you get more comfortable. This makes it easier to get started, since you have a lot less risk when you’re a beginner, and it makes for a great way to build a long-term saving strategy.
- Start Early. If you are reading this, and you’re over 18, it is probably a good idea for you to start building up your savings and investments, and this can be the most effective way to do it. The longer you put it off, the more opportunities for growth you are missing. Even if you only have $100 to start with, start with it!
- Keep Practicing. Just because you have opened your brokerage account doesn’t mean its time to close your practice account. Actually, its the opposite; investment strategies need time to develop, and if you constantly switch your strategy in your real brokerage account, you greatly increase your chance of losing money. PBS recommends trying out different strategies on HowTheMarketWorks before using them in your real brokerage account, and you can keep trying different strategies in our monthly contests, and win more money doing it.
Recommended Stock Broker List
This list is NOT in order of “best to worst”, we think these are all great choices depending on what you are looking for. Pick the option that best describes how you feel about your investing needs.
TD Ameritrade is consistently ranked as one of the best brokers in terms of advisor expertise, investor education, and the sheer amount of tools at your disposal.
They are also always at the top of the list of brokers for long-term investors, with tons of different ways to view your portfolio outlook as it evolves over time. For brand-new investors who want to start small, this might be a drawback, since the sheer volume of what you’re looking at can be daunting. However, if you want a lot of resources at your disposal and want to start building a nest egg, TD’s team is second to none.
Available Securities: Stocks, ETFs, Mutual Funds, Options, Bonds, Futures, and Forex
Commissions: Free for 60 days, free on select ETFs, $9.99 per trade otherwise
Best Suited For: Serious long-term investors, investors who want the most expert advice and research tools for every trade
Get Started Here!
TradeKing is another fairly new broker, launched in 2005. They are a solid “Discount Broker”, offering investors a platform with lower commission fees, but also less investment advisor support and research tools.
They make up for this with a very strong community of traders eager to share investment strategies, including blog support, social media integration, and much more. True to their word, they have some of the lowest commission fees we could find.
Available Securities: Stocks, ETFs, Mutual Funds, Bonds, Options
Commissions: $4.95 per trade, Options cost $0.65 extra per contract
Best Suited For: Active investors (who buy and sell several times a week/month), Day Traders.
Get Started Here!
OptionsHouse is designed for options trading, although they have stocks too. They have a strong selection of research tools (focusing on Options). It does not have the social aspect of TradeKing, nor do they offer free real-time quotes, mutual funds, or bonds. In exchange, it has the lowest commissions for Options of any of the brokers we have reviewed.
On the flip side, if you are interested in options investing, they absolutely have your back. They have powerful research tools, charts, graphs, and more. Real-time quotes aren’t free, but they do have those available, along with historical price data, for a fee if you want to do your research here.
Available Securities: Stocks, ETFs, Options
Commissions: $4.95 per trade, Options cost $0.50 extra per contract
Best Suited For: Options Investors
Get Started Here!
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