To assist you in locating the top online stock brokers, Bankrate conducted an analysis of the key players. Here are some of our favorites.
The best online brokers for stocks in 2022:
- Charles Schwab
- Fidelity Investments
- TD Ameritrade
- Robinhood
- E-Trade
- Interactive Brokers
- Merrill Edge
The top online brokers for stocks in September 2022
A financial organization known as an online broker enables you to buy securities, such as stocks, online. Because they provide a significant savings over what a traditional full-service brokerage business costs, online brokers are sometimes referred to as bargain brokers.
With an online broker, you won't receive the same financial advice or investment recommendations that full-service brokers normally offer, but depending on the broker you select, you may have access to commission-free trading and a variety of additional services and products. For the majority of investors, using an online broker makes sense.
What to consider when choosing a broker
The top online stock trading platforms provide user-friendly tools for investors and reasonable fees for traders. We took into account the following aspects to compile a list of businesses that consumers should think about this year:
- Price: You're in luck when it comes to costs because they have been rapidly decreasing as the majority of online brokers have lowered their trading commissions on stocks and ETFs to $0. We compared fees and trading prices for this list of the finest online trading platforms.
- Broker resources: You should also think at things like the broker's research resources and assistance, the caliber of the digital trading program, and the ease with which transactions may be executed, among other things.
- Strategy: Your specific investment strategy, including how frequently you want to trade and whether you are a beginner or more experienced, will ultimately determine the account you truly desire. We took into account the varied types of consumers each investing platform catered its offerings to.
Charles Schwab
With a long history of assisting individual investors, Charles Schwab continues this legacy today. From 2016 through 2018, J.D. Power rated the business as “Highest in Investor Satisfaction with Full Service Brokerage Firms, Three Years in a Row.” Schwab topped the rankings for DIY investors in the 2020 poll, but it dropped one spot in the 2021 rankings. In the Bankrate Awards for 2022, Schwab was named both the best broker overall and the best broker for buy-and-hold investors.
Why we like them:
- Wonderful trading tools
- Outstanding customer service.
- A wide choice of commission-free research and instructional products.
- A novel customer service policy provides that, in the event that a client is dissatisfied, they may receive a refund of any connected commissions, transaction fees, or advisory program fees.
Who are they best for? Schwab is often a fantastic option for those who want to do it themselves and have professionals on call just in case, from rookie investors to seasoned pros.
Pricing: In terms of stock and ETF commissions, Schwab adheres to the industry standard of zero, which it helped establish. However, there is still a $0.65 per-contract cost for option trading.
Fidelity Investments
Fidelity will treat you fairly whether you're seeking for an excellent trading platform, affordable commissions, or friendly customer service. This broker is one of the easiest to use, especially if you're just getting started, and it does everything effectively. It also works well for experienced investors.
Why we like them:
- For investors preparing for retirement, Fidelity has a solid reputation for providing some of the best research and tools. The account is a fantastic choice for investors who wish to delve deeper because of the information offered on its site, which also contains advanced screening capabilities.
- Fidelity won the top rank in Investor's Business Daily's 2022 investor survey, which surveyed clients who actively utilize their services, further enhancing its reputation.
- In the 2022 Bankrate Awards, Fidelity was chosen the best broker for novice investors as well as the best broker for retirement investment.
- Numerous more services that other brokers typically charge for are likewise free at Fidelity.
Who are they best for? New investors can gain a lot from Fidelity's extensive selection of simple-to-understand training resources.
Pricing: All traders, but notably long-term buy-and-hold investors, benefited from Fidelity's decision to reduce its trading commissions to zero along with the majority of the industry.
TD Ameritrade
Investors of all skill levels should consider TD Ameritrade, whether they require mentoring and education as they get started or when they are prepared to use the broker's powerful thinkorswim trading platform. In either case, TD Ameritrade is likely to have everything you require. (Charles Schwab has acquired TD Ameritrade; the two brokers will eventually be integrated.)
Why we like them:
- Gives you access to a collection of instructional materials, including thousands of articles, webcasts, and videos.
- Beyond stocks, a variety of securities can be traded. You can trade cryptocurrencies using futures as well as bonds, options, and futures. All of this is also possible through the broker's mobile app.
- The absence of account minimums makes TD Ameritrade a desirable choice for newcomers.
Who are they best for? Traders who wish to dive a little deeper into the details of their trading can take advantage of the broker's extremely capable trading platforms and tools.
Pricing: For stock and ETF trades on TD Ameritrade, there are no commission fees, and trading options now costs $0.65 per contract.
E-Trade
Whether you're a passive or active investor, a newbie or a pro, E-Trade offers a reliable solution. It also includes a fantastic educational area with a rotating selection of webinars, news pieces, and instructional films for investors of all experience levels in addition to a library of educational materials.
Why we like them:
- For the most recent research and comments that can aid in the development of your trading strategy, you can also consult E-Trade analysts.
- E-Trade provides online chat as well as round-the-clock phone support.
- The broker's flagship trading platform, Power E-Trade, which has a ton of tools and a mobile edition, may be appreciated by active traders.
Who are they best for? E-discounts Trade's on volume options trading and professional research are a major advantage if you want to trade frequently.
Pricing: E-Trade costs $0.65 per option contract and zero commissions for trades in stocks and ETFs, similar to other big brokers. Traders who execute 30 or more trades each quarter are eligible for a reduced commission of $0.50 per contract.
Robinhood
Despite being relatively young, online brokerage Robinhood has quickly gained millions of devoted fans because to its commission-free trading and user-friendly smartphone app.
Why we like them:
- You can trade stocks, ETFs, options, and cryptocurrencies without paying any fees.
- It also features a cash management account, so if you wish to trade, you may send money quickly.
- For $5 per month, you can sign up for their premium tier, Robinhood Gold, which gives you access to certain research and margin trading.
One downside: For the time being, Robinhood only provides individual taxable accounts, but it plans to eventually offer joint accounts as well as IRAs.
Who are they best for? For new investors who wish to trade quickly and with minimal trouble, Robinhood is a terrific platform.
Pricing: The fintech firm not only provides zero-fee stock and ETF trading, but it is also actively working to upend the market and turn into a platform that provides a wide range of financial goods and services. For instance, it provides free trading for cryptocurrencies and options.
Interactive Brokers
With its strong trading platform and reliable trade execution, Interactive Brokers has a long history of serving professionals and active investors.
Why we like them:
- With a "light" version of the service that offers no-fee trading, it has made inroads in recent years to attract fresh customers.
- Additionally, it has improved upon customer service and fundamental research.
- This change has smoothed out the edges of a formerly basic service that even industry experts believed was lacking in features in favor of low prices and trade execution.
- A freshly created customer support page offers the same high degree of functionality as the old page while being simpler to navigate.
Who are they best for? Investors looking to up their investment game who may already know a thing or two.
Pricing: The transition of the industry to no-fee stock trading was truly started by Interactive Brokers. For stocks and ETFs, its Lite service levies no commissions, whereas its Pro service charges $1 per trade for up to 200 shares, with additional shares costing a half-penny apiece. Volume pricing is also an option. Options are priced at $0.65 per contract, and for traders who are really active, volume-based pricing is also available.
Merrill Edge
Merrill Edge is a full-service broker that caters to investors wishing to get started while still providing traders with high-quality tools. This is particularly clear when you take into account the broker's more than 2,000 locations inside of parent Bank of America branches, making human advisors conveniently accessible. This is a useful tool for newbie investors who require some guidance.
Why we like them:
- You can acquire in-depth research reports on certain stocks if you sign up to be the broker's preferred client, but you can also access research from Morningstar and Lipper.
- Merrill also excels at providing educational resources that aid with financial planning.
- There is always someone accessible to assist you because customer assistance is offered seven days a week, 24 hours a day.
Who are they best for? The extensive resources and available customer service support provided by Merrill are advantageous to investors of all experience levels.
Pricing: Stock and ETF trading at Merrill Edge are free of charge, whereas option trades cost $0.65 per contract, which is in line with the majority of the industry.
How to start trading stocks quickly and easily
Online stock trading may seem difficult, but it's actually rather simple once you have an account set up. Here are some pointers on how to get going right away:
- Do your research. When your account is funded, you'll be able to get started right away by researching suitable investments beforehand.
- Gather personal information. You'll need to submit some basic personal information about yourself and any other persons mentioned on the account in order to register an account. Be sure to have details on hand, such as your social security number.
- Link your bank account. You can deposit money faster if you link your bank account to your online broker than if you mail a paper check. Within a few days of opening your account, you should be able to begin trading thanks to electronic funding.
Can you buy stocks online without a broker?
To purchase and sell stocks, the majority of individuals will choose to use an online broker. While some businesses do provide direct purchase programs that let you purchase stock directly from them, doing so is unnecessary since most internet brokers offer commission-free stock purchases, and these programs can be difficult to use.
