Guide to Choosing an Online Trading Broker

With the right trading broker, you can get huge returns on your investments. However, getting the right online trading broker can be quite a challenge. There is stiff competition among online trading brokers, which might make it confusing to choose one. That is particularly the case if you are inexperienced in stock trading. Below is a guide to help you choose the right online trading broker.

Know Your Needs

The first step is to determine your needs and the essential things for you in a trading platform. How much you know about investments and your goals should help you determine your needs. If you are experienced in trading, you might want to prioritize opinion-based resources, technical data, advanced charting capabilities, mutual funds, and conditional order options when choosing a broker.

Narrow Down the Field

With all your investment goals and needed services outlined, the next step should be to whittle down your options. There are various things that all reputable brokers should have, which you can use to narrow down your options. Your choices should be limited to those who are members of various relevant regulating authorities, covered by the Federal Deposit Insurance Corporation, and offer you a guarantee of protection against fraud. You can also consider factors like online security and brokerage account offerings.

Consider the Fees Charged

Your return on investment should matter most to you, but it is still advisable to get a good idea of all the charges you will incur for using any broker. Consider the value you get for the charges rather than the amount of charge. For example, it might be worth paying a small premium in a platform that offers more features than its competitors do. Examples of the fees you might have to pay include account opening, monthly or annual account maintenance, trading platform access, and margin rates.

Try the Broker’s Platform

Before making the final decision, try out the broker’s platform. That will allow you to get a hands-on feel of the tools and resources the broker has to offer. You might have to go through a signup and verification process before accessing the broker’s platform. You might also have to pay some fees to access the pro tools available on the platform. While trying out any platform, figure out the types of securities you can trade on, whether quotes are in real-time or streaming, the kinds of orders you can place, and whether you have full control over the execution of trades.  …