(ND) Compare Online Stock Trading Brokerage Firms

Comparison Shopping

You won't have any problems finding an online stock broker. The worldwide web is crawling with them! The hardest thing is to figure out which brokerage firm is right for you.  This is as important as the stocks you will be investing in... so you'll need to choose wisely.

You'll first need to compare online stock trading brokerage firms.  Compare their fees and their services, and then compare that information to what your needs are.

If you're a new entrant in the field of online stock trading, you'll be better off with a firm that provides a full service offering; one that not only caters to the basic educational and trading needs of a first-time trader, but one that also allows you to buy partial shares of stocks (by way of automatic payment on a regular basis) and accumulate your investments over time. If you're lucky enough to find such a firm, you'll relish the opportunity to also complement your investing strategies by making real-time trades to buy and sell stocks immediately during market hours.

Sharebuilder.com offers just such a service...and is my personal online stock trading brokerage firm of choice. When you actually compare online stock trading brokerage firms you'll discover that 'unlike traditional online investment services', Sharebuilder gives investors a unique and powerful way to invest in the stock market. You'll find (with Sharebuilder) that you'll have a simple, flexible and affordable way to invest for the long term. You'll find a ton of great articles and tutorials on all aspects of online stock trading on their site. Plus, you'll even be able to compare Sharebuilder's service offering with four of the other leading online brokerage firms as they have created a comparative analysis table for that very purpose.

Ok, with such a rosy picture painted of Sharebuilder.com, should you even bother to look elsewhere?

Of course! That's what due diligence is all about. Research! Research! Research!

Don't get me wrong. Sharebuilder is a great online stock trading brokerage firm to deal with. But I'm biased, because I'm a rookie online stock trader and I need all the help I can get...and these guys deliver!

On the other hand, if you're a long-time trader who invests big money per trade, you'll no doubt be looking for the most cost-effective brokerage firm online; possibly one that charges less than $10 per round turn.

When I first started trading stocks online with Sharebuilder, I decided I would invest the princely sum of $100... because I could! You see...unlike most any other online stock trading brokerage firm I had ever encountered, I found that Sharebuilder had no  minimum deposit requirement...and since that was a big priority on my list, they got my vote.

Interestingly, the four other online brokerage firms featured in Sharebuilder's comparison table all have what some may consider pretty hefty minimum deposit policies.  TD Ameritrade's minimum is listed at $2000, while Schwab's is $2500.  NB: After I verified this information on the respective web sites, I chose Sharebuilder for that one reason.

Another important criterion to consider when you compare online stock trading brokerage firms is (as I stated earlier) the round turn (commission) charges of the trades or online market orders.  Sharebuilder charges from $11.95 to $15.95 depending on which plan you choose. Since I chose the freebie plan, my market trades cost me $15.95 each... but I can live with that because their service is so good.

TD Ameritrade however, won the coin toss at $9.99. Believe me...this is an excellent rate for any online stock trader who deals in large volumes.

As for me?

Well, all I had to start with was a mere $100... and given that TD Ameritrade's minimum balance requirement is $2,000...umm...well...you get the picture?

I might add though that all five brokerage firms involved in the comparison offered online statements, confirmations of trades, along with reinvestments of dividends. That in itself is quite impressive compared to many of the lesser brokerage firms online.  

Annual maintenance and low balance fees was also an interesting comparison.  Three of the brokerage firms, including Sharebuilder did not charge any fees for these... while E+trade and Schwab charged $160 and $120 a year respectively!

The important thing and the only important thing to consider when you compare online stock trading brokerage firms is which one can meet your needs? All of the companies mentioned in this article are upstanding companies with variable policies.  Choose the one that's best for you...and you'll be on your way.