STOP HESITATING & START TRADING! Choosing the right stock trading platform for you is important. There are many different things to consider when choosing your trading platform. If you are just getting started or looking to switch platforms, then this article should help guide you in your decision.
There are plenty of different stock trading platforms, but not all are created equal. When you want to use the stock market to make money, it is important that you choose a broker that is reliable and has great customer service.
Fidelity: Best Low-Cost Online Broker
4.8
- Account Minimum: $0
- Fees: $0 for stock/ETF trades, $0 plus $0.65/contract for options trade
Why We Chose It
Over the last year, we have re-evaluated what it means to be our best low-cost online broker. There are online brokers that cost next to nothing to trade on. That was all it took to walk away with this category in the past despite a broker having a limited range of assets, or a lack of useful tools, or a weak trading platform—and potentially all three as long as the price was low enough. This year, however, we went for low-cost in comparison to the value delivered. This approach to the data ended up with Fidelity (our best overall broker) on top, but the winning factors over close competitors were the cash management options on idle cash and the excellent portfolio analysis tools that consolidate outside accounts. If you aren’t going to be trading a large amount of options and you don’t require futures or cryptocurrency, then Fidelity offers you the most bang for your buck.Pros
- Low costs overall and a lack of many common fees
- Strong account management options, including a sweep program into money market funds
- Transparent pricing disclosure
- Excellent execution quality
Cons
- No futures, commodities, or cryptocurrencies
- Only available to U.S. residents
- A high fee ($32.95) for live broker assistance
Fidelity: Best Low-Cost Online Broker
4.8
- Account Minimum: $0
- Fees: $0 for stock/ETF trades, $0 plus $0.65/contract for options trade
Why We Chose It
Over the last year, we have re-evaluated what it means to be our best low-cost online broker. There are online brokers that cost next to nothing to trade on. That was all it took to walk away with this category in the past despite a broker having a limited range of assets, or a lack of useful tools, or a weak trading platform—and potentially all three as long as the price was low enough. This year, however, we went for low-cost in comparison to the value delivered. This approach to the data ended up with Fidelity (our best overall broker) on top, but the winning factors over close competitors were the cash management options on idle cash and the excellent portfolio analysis tools that consolidate outside accounts. If you aren’t going to be trading a large amount of options and you don’t require futures or cryptocurrency, then Fidelity offers you the most bang for your buck.Pros
- Low costs overall and a lack of many common fees
- Strong account management options, including a sweep program into money market funds
- Transparent pricing disclosure
- Excellent execution quality
Cons
- No futures, commodities, or cryptocurrencies
- Only available to U.S. residents
- A high fee ($32.95) for live broker assistance
Interactive Brokers: Best Broker for Fractional Shares
4.6
- Account Minimum: $0
- Fees: Maximum $0.005 per share for Pro platform or 1% of trade value, $0 for IBKR Lite
Why We Chose It
Interactive Brokers was one of the first brokers to really get behind fractional shares, but it repeats as our pick as the best broker for fractional shares because it simply offers more. The broker requires you to trade through the Traders WorkStation (TWS) to trade fractional shares, but once you are there, you have access to fractional shares for “U.S. stocks listed on NYSE, AMEX, NASDAQ, ARCA, or BATS, as well as OTC Pink U.S. penny stocks with average daily volume above $10 million and market cap above $400 million.”2 Non-U.S. stocks are not available as fractional shares, but that is a limitation shared by competitors. The point is that IBKR’s fractional share offerings go beyond the National Market System (NMS) exchanges where most online brokers draw the line. If you are looking to access fractional share trading for the largest pool of stocks, then Interactive Brokers is the obvious choice.
Pros
- Fractional shares for a wide swath of all U.S. stocks
- Excellent screeners and charting to find equities of interest
- Robust trading platform and tools
Cons
- Fractional shares limited to U.S. stocks (a common limitation)
- The TWS platform may be intimidating for non-traders
Discount Brokers vs. Full-Service Brokers
There are different types of brokers that beginning investors can consider based on the level of service and cost they are willing to pay. A full-service, or traditional, broker can provide a broader set of products and services than what a typical discount brokerage would. Full-service brokers can offer their clients financial and retirement planning as well as tax and investment advice. These additional services and features usually come at a steeper price.
If you are looking for a cheaper, more hands-on approach, a discount broker is a better choice. Discount brokers offer low-commission rates on trades and usually have web-based platforms or apps for you to manage your investments. Discount brokers are less expensive, but require you to pay close attention and educate yourself. Luckily, most discount brokers provide educational resources to help you learn to trade and invest.
Pros & Cons of Discount Brokers
Discount brokers can be ideal for those looking to save money. If you are a novice investor and need more hands-on guidance, however, they may not be the right fit for you.Pros
- Lower cost
- No need to worry about biased investment recommendations
- Access to basic educational resources to help you do it yourself
Cons
- No advice or guidance
- Possible hidden fees
- Less hands-on customer service
eToro – Overall Best Trading Platform 2021
Upon researching hundreds of online providers, we found that eToro is one of the best trading platforms to consider in 2021. First and foremost, the broker is perfect if you are just starting out in the world of online trading. This is because the platform is really simple to use and it supports small stakes.
For example, the minimum deposit is just $200 and you trade from $25 upwards. In terms of what assets you can trade, eToro supports several asset classes. This covers 2,400 stocks across 17 different markets. For example, you can buy shares in companies based in the US, Canada, UK, Hong Kong, and heaps of European exchanges.
eToro also allows you to access over 250 ETFs and 16 cryptocurrencies. If you’re looking for a commodity trading platform, eToro supports everything from gold and silver to oil and natural gas. And of course, eToro also offers a huge forex trading facility. Most importantly, each and every financial market at eToro can be traded on a commission-free basis. You don’t need to pay any ongoing fees either, so eToro is a great trading platform for those seeking a low-cost provider.
An additional reason why eToro makes the number one spot on our list as the best trading platform for beginners is that it offers passive investing tools. For example, through its CopyPortfolio feature, you can benefit from a professionally managed investment strategy. This means that the team at eToro will buy and sell assets on your behalf.
There are many strategies to choose from, such as a focus on tech stocks, cryptocurrencies – eToro is actually our best recommended bitcoin trading platform. You then have the eToro Copy Trading tool. This is where you will select a seasoned trader that you like the look of, and then copy all of their ongoing trades.
For example, if the trader allocates 3% of the portfolio into Apple stocks and 2% into IBM, your portfolio will do the same. When it comes to the fundamentals, eToro allows you to deposit funds with a debit card, credit card, bank wire, or an e-wallet like Paypal and Skrill. The trading platform is regulated by the FCA (UK), CySEC (Cyprus), and ASIC (Australia), which illustrates that it takes client safety seriously. For those in the US, eToro is registered with FINRA.
eToro fees
| Fee | Amount |
| Stock trading fee | Free |
| Forex trading fee | Spread, 2.1 pips for GBP/USD |
| Crypto trading fee | Spread, 0.75% for Bitcoin |
| Inactivity fee | $10 a month after one year |
| Withdrawal fee | $5 |
What we like:
- Super user-friendly trading platform
- Buy stocks without paying any commission or share dealing charges
- 2,400+ stocks and 250+ ETFs listed on 17 international markets
- Trade cryptocurrencies, commodities, and forex
- Deposit funds with a debit/credit card, e-wallet, or bank account
- Ability to copy the trades of other users
- Regulated by the FCA, CySEC, ASIC and registered with FINRA
What we don’t like:
- Not suitable for advanced traders that like to perform technical analysis
Conclusion
There are several stock trading platforms. Before you make a choice, there are some things to think about, such as the computer programs and mobile devices that the platforms work with and how they affect your daily trades. The article will also look at the ways and reasons why traders use these platforms and their differences and similarities.