When it comes to stock market investing, so many of us want to manage our own accounts on our own terms. To do this, we turn to investing with an online broker. Obviously this raises concerns about safety, as well as affordability. This begs the question: What online brokers should I trust and invest with?
Many online brokers are available, but no two are alike. Many of them advertise on other websites, and have such pitch lines as: 100 free trades, 4 dollar trades, and $1.95 options contracts. These sells lines are good for drawing business in, but they do not tell the whole story. For instance, the 4 dollar trades line is the headline of many sharebuilder or ing direct ads. This company does in fact offer 4 dollar trades but only if they are not real time trades. Real time trades, which are trades executed the moment you place them, run a standard rate of $9.95 on sharebuilder.
Also, anytime you sell your position on sharebuilder, you will be charged the base rate of $9.95. The 4 dollar rate applies to trade that are made in advance or set up to occur in the future. When trading in this manner, you may not get the stock at the price you want. However, overall sharebuilder is a fine site for the beginning investor or infrequent trader.
Other online investment sites such as e-trade.com are better geared towards the more experienced trader. The technology behind e-trade is for those who understand advanced Wall Street jargon. E-trade is also designed in general to be used by day traders, or those who trade in and out of stocks on a very frequent basis. They are the site well known for ads reading “100 free trades”. This offer of 100 free trades is applied to accounts that sign up others to the e-trade site. In other words, you have to work to get your free trades. E-trade is a better choice for those who are well experienced in the ways of Wall Street.
These are just two of the online investment sites, however these stock tips should give you a good idea of the variety on the web. As a general rule, investors should use websites that are well known, such as the two mentioned above. Searching for the best possible trading price may lead you to scam sites, and this should be avoided at all costs.
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