Anybody who is thinking about opening a brokerage account should think about their personal needs and goals. Are you confident enough in your level of knowledge that you don’t need a lot of information and resources to get started? Then you should look for the best low cost brokerage platform online. A robo-advisor might be useful as well, if you don’t think you’ll need an actual, “real” person to help you with all of your trades.
Keep in mind that some brokers have restrictions that put a limit on who will be allowed to open an account. You might not be the right type of “investor” or “trader” for some brokerage services. Some have minimum amount requirements that might be beyond what you can afford. If you are not a frequent, day trader then avoid a trading platform charges inactivity fees.
The reason why there be some minimum requirements on how much money have to start with (and maintain in some cases) is because accounts can cost the broker money to maintain, and they need to make sure that each investor is going to bring in enough incremental revenue for covering all of the expenses of having them as a customer.
Best Low Cost Brokerage for More Than Stocks
Most people want to trade more than just stocks. The best low cost brokerage will offer the opportunity for diversification. On top of stocks / EFTs / options, you should be able to purchase bonds and put money into mutual funds. The commission fees per trade or purchase should be low. Some online brokers will even let customers make at least 1 free withdrawal per month.
Before settling on a platform, look at previews and screencaps of the trading tools. Does the interface look user-friendly to you? Is there good documentation, such as tutorials, to help you get started? Some online brokers offer desktop-based trading software and some offer apps.
Another thing to do before creating an online trading account is to read the privacy policy of the company. You should at least have an overview of the personal information the brokerage will require from you and collect from you, as well as its practices for processing, disclosing, and using that information. Only sign up for an account at a website or app that is committed to taking reasonable efforts to keep all data secured, and that there is never any unauthorized access.
While it’s not for every type of trader, one of the best low cost brokerage companies to start with is Zacks Trade. It offers a variety of trading options, little to no fees, good tutorials, customer support, and more.