If you can open up a bank account you can open up a stock trading account. The process is not difficult. It requires nothing more than filling out an application, providing proof of your identity and depositing some money. Different brokers require different amounts of money to open an account. Securities can be substituted for cash in the process. Discount brokers will accept amounts as low as $500 while full-service stock brokers may require substantially more.
There is a broker out there to fit your needs. If you are someone that feels they can take care of their own investments and trade ideas then going with one of any number of discount, online stock trading brokers will likely fulfill your needs. Many discount brokers also offer IRA accounts and other tax-sheltered products like the larger firms do. Some also have local branch offices as well if you are leery of dealing only with a website.
Traditional, full-service brokerages generally provide a higher degree of customer interaction, being available to give and take advice on trades, investment strategies and the like. Opening up a stock trading account with one of them is not recommended if you are an active trader as these firms charge much higher broker’s fees for placing trades, which are usually percentage based with minimum fees. Their account minimums are usually much higher as well. Practically, depositing $1000 in an account where the average trade costs $100 to complete is just a frozen asset.
No matter if the stock broker you pick to work with has its customers interface with them via website or in an office, the ability to place a trade over the phone is always available. All discount brokers have the option for a ‘broker-assisted’ trade. The costs are usually higher than the advertised price, which is nearly always for online stock trading positions.
Each brokerage has its own set of tools and perks to offer to customers. If you go with an online stock trading broker testing out the interface of the software is recommended. Find something that you are comfortable navigating. The research tools of many of the best online brokerages now rival that of the traditional, full-service firms. The main difference between them, for the price, is that with the online firm you will not have a broker assigned to you. Instead when you call in for a broker-assisted trade you will get the first available broker to walk you through and advise you on the trade.Previous Post » Stock Trading And How To Profit From It