What the best online brokers have

  • Free trading tools. These include such things as real-time stock quotes and free market research and education. The online broker's web and mobile interfaces should be logical and easy to use. (You can try most before committing to a broker.)
  • Strong security. Look for guarantees that your personal information is protected and that your account is insured; mobile and online accounts should be password protected. Check for news about the broker to see if there are any reports of irregularities.
  • Reasonable (and clear) commissions and fees. Competition between online brokers is fierce, and prices fluctuate widely based on the provider and your type of investment. If you're an infrequent trader who primarily invests in mutual funds, make sure to understand the fund's fees and how they will affect your investment.
  • Quick trade times. Online brokers should offer immediate or scheduled trades, including the ability to purchase at the start of trading, when the markets close and even after hours. Ask how long trades take to process before signing up.
  • Mobile options. The vast majority of online brokers have mobile trading and account information, but not all are compatible with every mobile device. The best have charts, research and other technical information on mobile platforms.
  • Good customer service. The best online brokers have multiple options for customer service, including live chat, email, phone, branches and 24-hour support.

Know before you buy

  • Think about how much trading you will do. If you plan to invest in a retirement account or an education savings plan, you probably won't trade often. You may simply want a reliable broker with a good selection of investment products and the planning and analysis tools to help you choose among them. If you plan to trade fairly often, you may want a broker with low commissions and fees and good trading tools. If you plan to trade frequently, direct-access trading and mobile access to your account could matter the most.
  • Read the fine print. Does the commission change based on type or size of order or how frequently you trade? Look for additional fees such as an inactivity fee or fees for closing your account.
  • Beware of minimums. With many brokers, there is a minimum amount needed to open or maintain an account, or to receive low commissions and trading tools.
  • Do you need banking? Some, but not all, brokerages offer banking along with online trading. If you want to consolidate your finances, banking with your broker is worth looking into.
  • Don't forget cash. Compare the interest rate on the cash in your investment account to what you can get at a savings bank or elsewhere.

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