About the Top Brokerage Firms
When investing, it is important to keep overall cost basis down as much as possible. If you are savvy enough to manage your own money, you avoid additional fees assessed by a brokerage firm or fund manager. Investing on your own requires a brokerage account, and fees are associated with transactions as they occur. Keep in mind that not all brokerage firms offering accounts are created equal.
Different brokerage firms offer different services and service at different fees. Competition for your business is fierce, so use that to your advantage as you perform your research and make your selection.
- Understand commissions and fees assessed. Just as with any service, larger brokerage companies are able to offer cut throat pricing. Compare these fees and understand how they will impact your ability to manage your portfolio. Fees are typically different for traditional equity investments such as stocks than for options or mutual funds. The specific mix in your portfolio will determine what fees you will be assessed.
- Understand your available investment options. Depending on your level of investment sophistication, not all brokerage accounts may be suitable for your needs. If you are looking to diversify beyond typical blue chip or indexes, review investment options carefully. Not all brokerage accounts may allow for commodities or currency trading for example. Ask questions, and review disclosures thoroughly in writing before opening an account.
- Review the company’s website. Many brokerage accounts allow for online trading as a matter of basic account access. This will allow you to trade instantly, or to setup trades to trigger at a specific price point or market condition. Aside from performing actual trades, the website should allow you to fund your account, perform research, and view your portfolio holdings at a quick glance. Ask about a demo of the website that you would be using as an active account holder. Doing so will allow you to ensure that you can navigate and perform transactions necessary to properly manage your account.