As discussed in 3 Ways to Accumulate Wealth , featured on the AttainmentPower’s Youtube channel, savvy investing is one key way to achieve economic mobility. The best thing about the stock market is that it is always moving, and it’s never too late for you to stake your claim on it. In fact, there is no better time than now, in this bullish market, to find those breakouts you’re looking for. But for those of us with low starting capital and little investment knowledge, it can be a daunting challenge. How can you look at hundreds of green and red tickers moving up, down and sideways, or dig through endless data points and analyst recommendations, and make sense of it? Another consideration is an online stock broker’s commission on trades (and you’ll be using an online broker, unless you can afford over $30-$200 for a single trade), as well as their stock selection, interface and educational materials.
Below are my list of the three best overall online stock brokers that will help you begin your journey in the investment world for 2017:
TD Ameritrade is a fantastic online stock broker to begin investing! On their site, you can trade stock, options, mutual funds, forex, and futures. For one, it costs nothing to sign up and maintain your portfolio. A $0 account minimum is great news for those who don’t have a lot of starting capital, and it takes the pressure off of you to maintain a certain balance when you are making your first trades. Their “thinkorswim” platform is award-winning, giving you robust tools on a clean interface to screen and trade stocks. In fact, TD Ameritrade’s number-one advantage for beginning investors is its interface and ease-of use; this is tremendously important, because you don’t want to be stuck in limbo while an important buy or sell is on the horizon. And if you need to trade on-the-go, TD Ameritrade also offers a mobile app, so you can make those quick, sneak-into-the-bathroom trades at work.
On the downside, their commission-per-trade is $6.95 – higher than average – but this was recently lowered from a high of $9.99; in addition, they charge .75 for option trades, which is also on the high side. However, they do offer over 100 commission-free ETFs to trade at your disposal. However, this is half of what Schwab bank offers.
- $0 account minimum
- Great trading platform and interface
- Higher than average trade and option commissions
- Smaller selection of commission-free trades
With so many different voices weighing in on the market, who do you trust? If you’re looking for guidance on investment strategy, Schwab is second-to-none. They are well-recognized for their vast array of educational materials to learn how to invest and augment your trading strategy. That guidance will be essential when you are starting out. Just like TD Ameritrade has an award-winning platform, so does Schwab have award-winning investment advice. And when you start to feel comfortable trading, you will only pay $4.95 commission for each trade, recently down from $6.95, and 65 cents per option contract! This is among the lowest for the industry, ensuring you deposit more money in your pocket, rather than the broker’s, for each profitable trade. And with over 200 commission-free ETFs available, you have plenty of options to pay no commission at all. Like TD, you can make those quick, sneak-into-the-bathroom trades at work with their mobile app.
On the downside, Schwab requires at least $1000 to open and maintain a trading account. Although many would argue you should not be trading with less than this anyway – and it is lower than some online brokers that require much more – it does add pressure to those who have limited funds near the borderline and want to begin trading. In addition, for those who wish to play the foreign exchange market, Schwab unfortunately does not offer a platform for that, at this time.
- Excellent investment educational materials and advice
- Low commissions on trades and options
- $1000 account minimum
- No Forex trading
Robinhood is a Google-backed smartphone app that gives you the ability to make trades at the click of a button on their seamless, simple trading platform. Simple is the key word here; just like there is no more simple search engine than Google, there is no more simple trading platform than Robinhood. Simplicity is a welcome asset when you have a myriad of choices sapping your attention on a constant, fast-changing stock market. On Robinhood, when you add a stock to your watchlist, you can easily view a company’s fundamentals, share price highs and lows, and recent news that may move a stock’s prices. Link your bank account and you can start trading on the same day that you sign up while Robinhood processes the deposit. What’s more, there is a $0 account minimum and they charge $0 commission for trades! This, in a phrase, is unheard of.
On the downside, these great perks do come at their own price. Although there is $0 commission on trades, this only applies to buys and sells of stock. Options and Forex trading are not permitted for free accounts, and you cannot make after-hours or pre-market trades. But for only $10 a month, you can purchase Robinhood Gold, which will give you access to all of this, and the ability to borrow 2x your account to increase your purchasing power with 0% interest up to $10,000. Again, unheard of. Still, you will not have access to a stock screener, educational materials or any of the other bells and whistles of Schwab, TD Ameritrade or any other online stock brokers. You can rely on free stock screeners like Zack’s Investment and go on stocktwits.com to find other Robinhood traders, but you will otherwise be left to your own devices.
- $0 Account Minimum
- $0 commission trades
- Very Simple to Use
- No Pre-Market/After-Market Trading
- No Options/Forex Trading
- Robinhood Gold adds above features, but still lacks in-depth technical analysis tools
Well there you have it! These three online stock brokers will appeal to you for different reasons, but they all share in common a fantastic investment HQ for beginning investors. Please comment below to tell us your favorite brokers and other resources that are helpful to investors who want to get their piece of the American Dream on the stock market. Thanks for reading!