For those starting to invest or seeking a new brokerage account, exploring the top online brokers is a smart first step. The best online brokers provide low commissions, robust trading platforms, ample research and education resources, and reliable customer support – all essential features for success as an investor.
Best online brokers in 2024
We have evaluated the best brokers based on key factors that matter to individual investors, such as trading fees, account minimums, free research, and other features. We have assessed each broker’s pros and cons, and here is how they compare on the most important aspects:
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- Cost: Considered trading commissions and other costs like transfer fees and account fees.
- Available securities: Assessed the variety of tradable securities offered by each broker.
- Account types: Examined the range of account types available at each brokerage.
- Trading platform: Evaluated whether brokers cater to buy-and-hold investors or active traders.
- Education: Reviewed the educational resources provided by each broker.
- Research: Analyzed the research offerings, including proprietary reports and third-party research.
- Customer support: Assessed the accessibility and quality of customer support services.
Interactive Brokers: Best overall
Interactive Brokers stands out as the top choice for active traders, offering a streamlined trading interface and excellent trade execution. With volume-based discounts and a professional-level trading platform, it is a preferred option for advanced traders.
Active traders using the Pro platform will benefit from low commissions, while Lite tier users enjoy commission-free trading on stocks and ETFs. Interactive Brokers also provides access to a vast selection of no-fee mutual funds and eliminates account and transfer fees.
- Best for: Active trading, tradable securities, margin trading
- Commission: $0 (Lite service) or $1 minimum per trade (Pro service), with volume discounts available; $0.65 per options contract
- Minimum: $0
Charles Schwab
Charles Schwab offers a customer-focused experience with low fees, solid research, and no account minimums. Beginners can take advantage of zero commissions and a wide range of no-transaction-fee funds, while advanced traders appreciate the customizable trading platforms.
The broker’s customer support, educational resources, and low trading costs make it a popular choice for buy-and-hold investors and those interested in retirement accounts.
- Best for: Overall experience, research, customer support
- Commission: $0 per stock or ETF trade; $0.65 per options contract
- Minimum: $0
Ally Invest
Ally Invest is an excellent option for Ally Bank customers seeking a full-service broker for various trades. With industry-standard commissions and competitive rates on options contracts, Ally Invest caters to a range of investors.
The broker also offers commission-free trading on a wide selection of mutual funds, making it a compelling choice for cost-conscious investors.
- Best for: Low trading commissions, Ally Bank customers
- Commission: $0 per stock or ETF trade; $0.50 per options contract
- Minimum: $0
E-Trade
E-Trade provides access to a diverse range of investment options, including stocks, bonds, options, ETFs, mutual funds, and futures. The broker offers extensive customer support, a high-quality mobile app, and research tools to assist investors in making informed decisions.
With no-transaction-fee mutual funds and a discount for frequent traders, E-Trade appeals to active traders and those looking for robust trading platforms.
- Best for: Active trading, robust trading platforms, no-transaction-fee mutual funds
- Commission: $0 per stock or ETF trade; $0.65 per options contract, with a discount to $0.50 for high-volume traders
- Minimum: $0
Fidelity Investments
Fidelity is known for its investor-friendly approach, offering commission-free trading on stocks and ETFs, a wide selection of mutual funds, and top-notch research and customer support. With a focus on eliminating unnecessary fees, Fidelity provides a high-quality experience for investors of all levels.
Beginner investors can benefit from Fidelity’s educational resources and retirement account options, making it a great choice for long-term investing.
- Best for: Overall experience, beginning investors, customer support
- Commission: $0 per stock or ETF trade; $0.65 per options contract
- Minimum: $0
Firstrade
Firstrade offers commission-free trading on stocks, ETFs, and options, along with a variety of account types and a robust research offering. With a highly rated mobile app and a wide selection of no-transaction-fee mutual funds, Firstrade is a solid choice for cost-conscious investors.
Investors can also take advantage of Firstrade’s diverse range of account options, including IRAs and education savings accounts.
- Best for: Low trading commissions, diverse account options
- Commission: $0 per stock or ETF trade; $0.50 per options contract
- Minimum: $0
In December 2023, the broker introduced the option to purchase fractional shares of stock, making it an appealing feature for newer investors.
Here are some top online brokers to consider:
1. Merrill Edge:
– Best for: Options traders, research, mobile app
– Commission: $0 per stock or ETF trade; $0 per options contract
– Minimum: $0
– Strong research offerings and integration with Bank of America
2. Webull:
– Best for: Commission-free trading, cryptocurrency trading, mobile trading
– Commission: $0 per stock or ETF trade; $0 per options contract
– Minimum: $0
– Offers attractive charting and the ability to purchase fractional shares
Honorable mentions include:
– Tastytrade: Ideal for options traders with attractive pricing
– Robinhood: Offers commission-free trading and fractional share purchases
– TradeStation: Wide range of securities available for trading
– Vanguard: Commission-free trading in stocks and ETFs
– SoFi Active Investing: No commissions on stocks, ETFs, and options, with fractional share purchases available
When choosing an online broker, consider your needs and preferences, such as trading style, account types, and customer support. Ensure that the broker is covered by the Securities Investor Protection Corporation (SIPC) for asset protection. Remember, while SIPC protects your assets, it does not protect you from investment losses. Investing in the stock market comes with risks, as stock prices can decline and may not always recover to their original value. Unlike FDIC-insured bank products, market-based investments can result in losses. However, a long-term investment in a diversified portfolio of stocks has the potential to yield significant returns.
When it comes to choosing an online stock broker for beginners, it’s important to consider factors like investor-friendly platforms, educational resources, and strong customer support. In the 2024 Bankrate Awards, Fidelity was recognized as the top broker for beginners, followed by Schwab, Interactive Brokers, E-Trade, and Merrill Edge. Fidelity stands out for its low costs, research tools, educational materials, and excellent customer service.
Brokers that offer robust customer support can help new investors navigate the complexities of the market and trading platforms. Access to educational resources and research tools is also crucial for making informed investment decisions. Whether you’re interested in stock funds or individual stocks, having a broker that provides valuable insights and analysis can be beneficial.
Ultimately, choosing a broker that aligns with your investment goals and preferences is key. While the process of selecting a broker may seem overwhelming for beginners, starting sooner rather than later is important. Once you’ve chosen a broker, you can begin building a solid foundation for your financial future.
In conclusion, the world of investing can be intimidating, but with the right broker and a strategic approach, you can set yourself up for long-term success. Don’t hesitate to start your investment journey and take control of your financial well-being.