How to Choose an Online Stock Broker

Thanks to the internet, it is easier than ever to begin investing in the stock markets. With online brokers, you are in complete control of your portfolio. Not only that, stock trades take place in 9 seconds or less during market hours. Plus you can view your stock quotes in real-time! Before the internet, if you wanted to buy some stock, you had to pick up the phone and call your stock broker. He or she would then charge you about $100.00 in commissions, and your stock trade could take hours or days to go through.

With the onset of the internet, a lot of the costs involved with placing a stock trade have been eliminated. There are many discount brokerages online today that allow you to buy as many shares of stock as you wish, for $13.00 or less! But with so many different online discount brokers, how do you know which one to choose?

For starters, it depends on how much you want to invest in the stock market. Most online brokers require a minimum balance of $1,000.00 or more to open a brokerage account.

The second item to look at is how much it costs to buy and sell stock from that broker. Commissions between brokers vary greatly. Some companies charge under $10.00 to make a stock trade, while others charge up to $50.00 per stock trade. Not only are commission’s charged, but some also have hidden filling and paper fees which aren’t included in the advertised commission price.

Here’s a table which compares the different fees from popular online stock brokers as of June 18th, 2007:

Ameritrade, Etrade, and Scottrade allow you to invest in just about any stock or mutual fund you wish. Also, Etrade charges a $3.00 handling fee if you make less than 9 trades every three months.

Look for a link to the broker’s “Fee table”. The Fee Table will list all the fees that the broker charges, and has a little explation on why the fees are charged, or what the fees are for.