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Choosing
YOUR Online Broker
This is an excerpt from the e-book
"Online Trading for Beginners"
(simply print this out thru your browser)
Chapter
Four - Choosing YOUR Online Broker
The process of choosing your broker and can be equally fun and frustrating.
The fun part is researching all the deals and costs per transaction
and services provided. Your initial decision is to determine whether
you need a full-service or discount broker. A full-service broker
is typically going to charge you two or three times the commission
cost per transaction compared to a discount broker. The discount
broker is for investors who are more
independent; that is, they do their own research and are somewhat
skilled already in making sound decisions with their investments.
In preparing to compile information for this book I counted over
100 brokers offering online trading as of this writing. You will
probably be thinking: “Oh no- 100 brokers! Where do I start?”
Let me help you make that decision now.
First, I will explain the factors that we need to consider
in making this choice. Among the factors you should consider are:
Your own personal experience during your direct contact with these
brokers.
Your brokers’ insurance level.
Cost per trade or commission levels.
Ease of understanding their online web design and navigation all
around their site.
Reputation and reliability of their server hardware and capacity.
Any possible infractions the dealer has been cited for.
Size of the broker and number of customers.
Level of “handholding” you desire or need.
Extra or hidden costs beyond commissions on trades.
Who the broker uses for investment information regarding company
profiles, historical reports, charting, and buy or sell recommendations.
.....Conclusions
One of the most important investment decisions you will make has
nothing to do with which stock, bond or mutual fund you buy. We’re
talking about selecting a broker. Hopefully the information in this
chapter will assist you in your search. Let’s recap:
• Brokers are the people who handle customer orders to buy
and sell securities.
• Don’t forget that a broker is a salesperson.
• Minimum balances required to open an account range from
thousands of dollars to nothing at all.
• All brokerages charge commissions to execute orders. This
fee varies widely depending on the type of brokerage.
• Look out for hidden fees for transactions like the transfer
of assets or inactivity.
• Full-service brokers offer much more, but they’re
expensive.
• Discount brokers don’t offer the extras, but they’re
affordable.
• Online brokerages have changed the industry by lowering
costs and blurring the line between discount and full-service.
• The type of brokerage you require depends on your investing
style.
• It’s possible to check the background of all brokers
and firms.
• The type of account you need depends on the type of securities
you want to hold.
• There are many ways to execute an equity order.
There is much more information
in choosing your broker available in our e-book. Click
here to ORDER THE EBOOK NOW!
If
this is valuable information for you, please take a look at the
Online Trading for Beginners e-book,
which includes the entire book.The book includes many more valuable
tips and all the resources I used when I started trading online.
It can be purchased at: http://www.estocktrading.net
Thanks for your time and Happy Trading !
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2005 © All Rights Reserved eStockTtrading.net
Reproduction in any form and means, including copying, electronic
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