Online Stock Brokers
Online Stock Brokers vs Full Service Brokers... Which is a better?
Broker Definition:
a person who functions as an intermediary between two or more parties in negotiating agreements, bargains, or the like. One employed by a member firm of a stock exchange, who buys and sells stocks and other securities for customers.
In the old days, a stock trader needed a personal stock broker to execute his trades for him. They were and still are known as Full Service Brokers.
Now of course, we are in the Information Age. Internet stock trading is one of the most valuable tools you can use to help you with your investing activities.
Using a high end Online Stock Broker such as , gives you the control to do your own research and pick your own stocks. They allow you to trade without having a particular broker acting as your agent, you don't even have to talk to anyone about the stocks you are buying and selling.
You are in total control of your financial destiny!
And the commission pricing structure of the online stock brokers can give you up to a 90 percent discount on full-service rates.
When you use a Full Service Broker, you are paying for the dedicated activity of a so-called "Investment Professional", who can keep an eye on your investment day after day, make recommendations on what stocks to but and sell, research and investigate new opportunities, and try to balance your portfolio to match you individual investment needs.
And you will definitely be paying for theses services, Full Service Brokers are the most expensive broker you'll encounter as you journey into the stock market.
The types of stock orders you can execute are now the same for both style of brokers.
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How a Full Service Broker Makes Money
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The fee structure in some segments of the brokerage industry is set up in such a way as to reward brokers, not for being successful in managing your money, but for moving your money around as much as possible.
These brokers are paid by transaction, and not by their success in managing their clients' accounts.
In other words, every time you buy or sell stock shares, your broker makes something just for handling the order for you. While there is not anything wrong with this practice, the fees can sometimes be quite substantial.
Using a Discount Stock Broker eliminates this.
My recommendation is .
Many full-service brokers are compensated based on the amount of assets under management. So, as your assets grow, so does your broker's. Take care to ensure that you are getting what you want from your broker and not what the broker wants.
So when a broker calls you daily to "let you in on a hot stock deal", be careful and make sure the company is a really good investment before you toss your hard-earned cash into it.
It's important to take a look at a full-service broker's investment history before you sign up for his services. If you are able to find someone you are comfortable with and feel you can trust, try to talk to other people who have worked with this individual before.
Make sure you ask lots of questions, and if there are any answers you don't like, move on!
If you don't want to do your own research and use online stock brokers, and would rather just let someone else make your financial decisions for you, then by all means try to find a good full-service broker with a solid track record - someone you can feel you can trust.
But be warned, you are giving up control into the hands of someone else. In my humble opinion, you are better off making those decisions yourself and use one of the many online stock brokers available.
And there is NO excuse why you cannot empower yourself to do online stock trading. You simply just need to educate yourself on all the mechanics of the Stock Market.
And after all....you have StockMarket-Coach to help and coach you along the way, so there is absolutely nothing to be afraid of!
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. is a Nationally licensed online discount stock broker offering low flat fees ($4.95 per trade plus $.65 per option contract) with no hidden costs or account minimums.
The TradeKing Web-based platform features powerful online equity, options and fixed-income trading tools including real-time portfolio information, advanced order entry, customized charting and alerts, free research and integrated news, stock, option and mutual fund screeners, volatility charts, a pricing probability calculator, enhanced option chains and interactive educational information.
. also features innovative community networking capabilities to help connect like-minded traders for enhanced strategy development and information sharing.
About TradeKing:
- For two years running, SmartMoney (the Wall Street Journal Magazine) rated TradeKing the #1 Discount Stock Broker in its annual Broker Survey of US stock brokers.
- TradeKing was awarded the highest ranking of 4 stars in Barron's 12th Annual Survey of Best Browser-Based online stock trading companies. The survey ranked TradeKing second (out of 15 Web-based online stock brokers) for both "Usability" and "Cost”.
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Next: Types of Stock Market Quotes
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Recommended Stock Trading Products and Tools
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The following are Stock Trading Systems and Strategies:
- Breakout Stock Trading
- Swing Trading
- Day Trading
- Trend Trading
- Value Investing
- Dividend Stocks
- Buying Penny Stocks
- Swing Trading
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