One important decision every investor faces is which stock broker to use. These days, brokers offer a wide range of services at a wide range of prices. After reading this article, you should have a better look at the three brokerages I have used (Schwab, Scottrade, and Tradeking) as well as some of the highlights from a group of other prominent brokers.

Charles Schwab (Homepage)

Schwab advertises $8.95 trades, but unless you trade 30 times a month your rate will be $12.95. They have good research reports for stocks and have nice, easy-to-read charts. Their customer service was always helpful and site features were ample. One selling feature for me was that I could open up a Schwab online checking account that had 3.5ish% APR (which is now down to 1%) and switch funds seamlessly between my checking and brokerage account. This is real nice for when you are just in cash!

Bottom Line: If you are trading with a large account, the commissions might not be an issue, but for most personal investors the $12.95/trade is going to eat up your profits.

Scottrade (Homepage)

Scottrade offers some relief on commissions. All trades made online are only $7. Once again, their website was full of all the usual features (stock reports, nice looking charts, and portfolio analysis), but they do have a $500 minimum to open an account. That really isn’t that big of a deal because it is rather difficult to trade on less than $500. I never had an issue with customer support and they probably have an office close to you.

Bottom Line: Scottrade offers pretty low rates at $7/trade, but if you are looking for ample amounts of online resources and analysis, you would do better with another broker.

Tradeking (Homepage)

I am currently using Tradeking and have very little to complain about. Trades are $4.95 and their website is chalked full of resources. They have incorporated social networking into their site as you can join in on discussion of different investments as well as read articles and tutorials on just about anything related to investing. They offer a technical screen, something I have yet to find anywhere else, and have great customer service (both online and over the phone). The only thing that annoys me is that you have to click in your password (rather than type it). I might just be challenged at it, but I always click on the wrong key and have to start over.

Bottom Line: Out of the brokers I have used, Tradeking is by far the best. I would strongly recommend Tradeking to any friends or family. Overall, A+!

Some facts on other brokers:

TD Ameritrade:

Trades are $9.99 over the internet. Looks to be geared towards the long-term investor. Good reputation with solid customer support.

Zecco:

$4.50 trades and if you make 25 trades/month or have a balance of $25K you get 10 free trades a month. Charts look to be low quality. Otherwise, looks to be your typical broker.

thinkorswim:

Boasts the top online trading software. Rates are either $0.015/share ($5 minimum) or $9.95 an order (5,000 shares maximum). If you are a tech person, this might be the broker for you!

E*Trade:

E*Trade’s commissions are an unadvertised $12.95 for most investors. If you trade 30-149 times/quarter or have $50K in assets you trade for $9.99 and if you make 150+ trades/quarter you get the low, advertised rate of $7.99. Their website is organized and looks professional. A little pricey for the average investor though.

Sharebuilder:

Normal trading will cost you $9.95/trade. Also, you can enroll in their automatic investing program and trade for $4/trade if that’s what you are into. No account minimums or inactivity fees. Looks to be a little basic compared to the other brokers.