| > | | | | online discount broker for simply reducing the |
| Find all things related to online discount brokers; | | | | commissions and fees involved in trading. Brokers |
| who are they? What are their services? What are | | | | offering lowest commission rates are always |
| their advantages and disadvantages of full-service | | | | preferable but double check the conditions and |
| traditional brokers? And how to choose right | | | | requirements (if any) that you should satisfy for |
| broker for your trading needs? Be an informed | | | | getting the lowest rates. Also check other fees |
| investor/trader. If you are an online trader, or | | | | which may involved including inactivity or |
| wish to be so, you can trade markets and | | | | maintenance fees, software usage fees, and so |
| products through two different ways. First is | | | | on. |
| through a full-service, also may known as | | | | 2. Your Trading Style and Goals: Are you a |
| traditional, brokerage firms. Second is through a | | | | part-time trader or day trader or position trader |
| discount brokerage firms. First way is costly but is | | | | or investor? The brokerage firm that you choose |
| usually safer as there shall be experienced | | | | should suit your trading style. If you lack |
| educated fellows who can help you in making right | | | | substantial trading knowledge, choosing a broker |
| decisions. Second way is less-costly but demands | | | | who offer discounted rates for broker assisted |
| you to make all decisions your own. | | | | trades should be better. If you are a very active |
| Online trading through discount brokers is only | | | | trader, you should trade with a direct access |
| suitable for well-educated and experienced traders | | | | broker charging deep discounted commissions. |
| who can analyze data, predict trends, place orders | | | | 3. Account and Margin Requirements: For getting |
| at right time and who can limit the trading risks. | | | | cheaper commission rates than normal, most |
| Discount brokers provide traders access to | | | | discount brokers demand you to fulfill certain |
| market information via a web based or installable | | | | requirements. Or they may have different |
| trading interface (known as trading system). The | | | | accounts with different commission rates and |
| system should also have some market/data | | | | different account requirements. Go through all of |
| analysis tools, indicators, and supporting tools for | | | | them and choose the one best suits you. Going |
| making the traders’ work easy. Some | | | | blindly for cheap’ is not always a good |
| discount brokers offer delayed access to | | | | option. |
| markets, some others offer direct (real-time) | | | | 4. Trading System: Simply, a trading system you |
| access to the market, which most offer both | | | | use should best suit your trading style. You hardly |
| — usually on different trading systems. | | | | can day trade the market with a free or web |
| Choosing the right discount broker for online | | | | based or limited-feature trading system. Similarly if |
| trading demands good broker knowledge. One can | | | | you are an investor going for level 2 trading |
| find broker features from the broker site itself. | | | | systems can cost you high. Things to notice |
| There are also so many sites which have individual | | | | include charting packages, tools available, speed, |
| broker reviews and comparisons. Suggestion is | | | | usability and stability. |
| that go through more than one site for getting | | | | 5. Special Offers: Most discount brokers have |
| more insight. While most online brokers operate | | | | special offers for new customers, like free trades |
| exclusively through internet (some also via phone) | | | | or reduced account requirements and free credits. |
| there are also some brokers who operate | | | | When all other things are good, going to broker |
| through branches. One should consider many | | | | who offer you better offers is good. |
| factors when finding the discount broker most | | | | 6. Additional Products offered: Many discount |
| suitable for him/her. It is a good practice to | | | | brokers allow account holders to trade different |
| prepare a checklist suiting your trading needs and | | | | products, like options, futures, funds and bonds. |
| evaluate brokers according to that. Below are | | | | Many brokers offer NTF (No Transfer Fee) funds, |
| some items which should be in your checklist. | | | | which can be an additional benefit. |
| | | | 7. Customer Service: Simple, No |
| 1. Commissions Charged: You are trading with an | | | | Compromise’ on that. |