If you’re an active investor, stocks most likely comprise a significant portion of your financial portfolio. But the volatility of the stock market represents both a blessing and a curse. If you’re lucky, knowledgeable or both, you can make the proverbial killing in the stock market. But it’s just as easy to be left holding worthless instruments.
Top-tier stock trading agencies cannot guarantee that you will always make money. But the best stock trading agencies share important characteristics, including reliability, security and a global presence. The stock trading companies here, listed in no particular order, have been positively evaluated on a range of factors, including user rating, available features, global presence, security and reliability.
Best Online Stock Trading Companies in the USA
Scottrade ranked #1 in the 2014 Self-Directed Investor Firm Ratings conducted by J.D. Power, and is highly ranked on a number of other lists as well. It’s easy to see why: Scottrade offers an excellent user experience, reasonable trade fees and a transparent fee schedule. The platform also features a wealth of free information to help investors feel confident about where they’re placing their money.
The respondents of the 2014 J.D. Power Self-Directed Investor Firm Ratings gave Charles Schwab high marks across the board. Schwab provides great value for the money, with many services including virtual trading and account transfers offered free of charge. New investors receive a bonus of $100 just for opening an account with Schwab.
E*Trade Financial ranks highly in research and in trading tools, and features reasonable pricing. E*Trade is also one of the largest and most prominent stock trading companies with a presence in Canada, Mexico, Asia, Europe and South Africa. With more than 3,000 employees worldwide, investors have ready access to live trader assistance.
Despite high marks across the board in the 2014 J.D. Power survey, Vanguard manages to fly under the radar for many investors. That’s really regrettable. Vanguard is a heavy hitter in the market, managing almost $3 trillion (that’s with a “T”) in assets. Vanguard also administers the world’s largest mutual fund, along with featuring the research tools and educational materials you would expect from a top-notch operation, which it is.
Fidelity ranked especially high in customer service and research, both essential elements for enhancing investor confidence. Fidelity also offers good value for the money and a broad variety of product offerings. One area where Fidelity falls a bit short is in ease of use. Beginning investors may find it difficult to navigate Fidelity’s online platform.
Affiliated with Charles Schwab, Options Xpress offers a $100 bonus for new investors. Options Xpress also offers virtual training, broker-assisted training and instructor-led investment courses free of charge. Options Xpress also features outstanding customer service and research materials to help investors make the right choices.
Don’t let the low $4.75 per trade price fool you. OptionsHouse is a first-rate operation. The platform features a user-friendly interface with rich data and research tools, available at no charge. Rated “Best for Options Trading” four years in a row by Barron’s, and with outstanding customer service, the only thing cut-rate about OptionsHouse is the price.
8) Trade King
TradeKing is another low-priced stock trading agency that nonetheless scores high marks. Stock trades are priced at a flat $4.95 each and options are $4.95 plus 65 cents per contract. Broker assisted trades are priced at a reasonable $20. Even with these low prices, new traders can receive a generous $150 refund in transfer fees. The only (minor) knock is the lack of 24/7 support.
TD Ameritrade is another big name that rates high marks across the board on the 2014 J.D. Power survey. Stock Trades are a bit pricey at $9.99; options trades cost $9.99 plus 75 cents per contract. But there is no minimum balance requirement and the available information and trading tools provided by TD Ameritrade are second to none. New investors trade free for 90 days and can receive credits of up to $600.
ShareBuilder offers stock trades at a reasonable $6.95 and options trades for $6.95 plus 75 cents per contract. New investors can receive a bonus of up to $600 when they fund their accounts. ShareBuilder is ideal for investors interested in automatic trades. Drawbacks include no broker assisted trading and no international trading.
Firstrade offers 10,000 mutual funds, stocks, options and no-fee IRAs, and requires no minimum account balance for investors. Self-executed trades are a reasonable $6.95 each for stocks and $6.95 plus 75 cents per contract. These features plus a clean, easily navigated dashboard make Firstrade a great choice for independent investors. On the other hand, broker-assisted trades are a pricey $26.95 each. Ouch.
The name may be silly but tradeMONSTER has snagged serious praise from the financial sector’s biggest names. Barrons ranked tradeMONSTER as the best options platform four years in a row. Minimum opening balance is $2,000; but individual trades are a thrifty $4.95, option contract fees are 50 cents and there are no account maintenance fees. On the downside, research is skimpy, so it’s not the best platform for novices.
If you are a high-level investor who values a professional platform and a broad variety of trading choices, Interactive Brokers is ideal. You have your choice of options, stocks, corporate and municipal bonds, Treasury instruments, Forex and more. But Interactive Brokers also features a tedious sign-up process that involves waiting for verification codes to arrive by postal mail. The minimum opening balance is an eye-popping $10,000.
14) USAA Brokerage
While USAA insurance is available only to military personnel and their families, its banking and financial services products are available to the general public. USAA has a two-tiered fee system: $5.95 per month for Platinum members who execute 25 trades within 90 days or execute $16 trades within 90 days and maintain a $50,000 account balance. The $8.95 per month Gold membership applies to everyone else. There are no surcharges for after-hours trading and few other fees. If you already hold one of USAA’s fine bank accounts, a brokerage account is a logical addition.
The good: Lightspeed Trading allows investors to open an array of accounts, including Roth and traditional IRAs, futures and options for individual or joint traders. Novices are allowed to practice on a free account, and an online community offers encouragement and assistance. There is also automated trading and direct access to exchanges. The bad? Requiring a minimum account balance of $5,000 to avoid a monthly $25 fee. Customer service is also not the best, there are no mutual funds offered, and the platform cannot be accessed on mobile devices.
16) MB Trading
The enrollment process at MB trading compels investors to jump through hoops that other trading platforms don’t require. MB Trading also charges a $30 annual fee for IRAs and a surcharge for after-hours trading. But MB Trading also treats its investors to a first-rate trading platform and excellent customer service. MB Trading also skips those annoying hidden fees for maintenance or inactivity.
17) Place Trade
Place Trade features rich investment advice and access to a worldwide market through its platform. Interactive brokers contribute to a powerful trading platform, and automatic investment adds to the convenience of PlaceTrade. But PlaceTrade also imposes a $20 fee for investors with accounts totaling less than $2,000 with less than $30 in total commissions each month, so it’s best for active investors.
The $99 monthly charge to use the downloadable TradeStation platform may be a deal breaker for casual investors; the $5,000 minimum deposit will stop others cold. However, fees are waived for active traders who trade at least 5,000 shares or 50 options contracts per month. Serious traders will also appreciate the professional level of the user interface built into the TradeStation platform, access to all major investment products, the strong, knowledgeable online trader community and the opportunity to customize the software to suit one’s own preferences.
19) Merrill Edge
The Platinum Edge program allows investors with more than $50,000 in assets either with Bank of America or Merrill Edge to receive 30 free trades each month. Merrill Edge is also dramatically increasing the number of traders on staff, from 1,500 to 2,000. Merrill Edge also has mobile apps that were recently upgraded to allow multi-leg options trading. The online platform is fast and feature packed.
SpeedTrader is priced to correspond with the average costs for online trading. Point and click trading and visual alerts make the trading process easy. Virtual trading and a professional trading platform are also valuable assets offered. But SpeedTrader offers no research tools and imposes a $30 fee for accounts that register fewer than 15 trades per quarter.