Online Broker Comparison | Compare Online Brokerages

See how the top online brokers compare to each other based on two important measures.
This chart ranks the top trading brokers from highest to lowest (5 stars is highest) based on:

a) Trading Fees and Account Minimums (50% weighting)
b) Overall Service Quality ratings (50% weighting)

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BROKER NAME	HOW MUCH ARE FEES? - Trading Fees -	HOW GOOD ARE THEY? - 2011 Service Quality Ratings -	COMPARISON SNAPSHOT
Overall Rating = 5 Stars TradeKing	$4.95 per trade* ============= No Account Minimum (Fund your account with any amount)	SmartMoney WSJ Magazine * Rated # 6 online broker in 2012 * Rated "Best" in Customer Service in 2012, 2011 & 2010 * Rated #4 broker in 2010 Barron's Received 4 out of 5 stars in the 2011 online broker review.	- Best combination of low cost trading and high customer service ratings. - No upcharge for broker-assisted trades. - Strong in educational materials.
Overall Rating = 4.5 Stars OptionsHouse	$3.95 per trade ============= $1,000 Account Minimum ($2,000 for margin account)	Barron's * Overall Rating of "4 Stars" in 2012 * Rated "Best" for Options Traders in 2012, 2011 and 2010. * Awarded "4.5 Stars" for Trade Experience and "4 Stars" for Research Amenities and Customer Service & Education	- Very low-cost stock trading. - High-end trading platform has advanced tools for options traders. - Offers "virtual trading" to practice trading at no risk.
Overall Rating = 4 Stars Scottrade	$7.00 per trade* ============= $500 Account Minimum**	SmartMoney WSJ Magazine * Rated #2 online broker in 2012, up from #3 in 2011 * Receives 4 stars for Mutual Funds and Investment Products	- Offers competitive pricing and is solid in most rating categories. - Targets the experienced trader with foreign market trading, local branch offices and investment products.
Overall Rating = 4 Stars TD Ameritrade	$9.99 per trade ============= $2,000 Account Minimum	SmartMoney WSJ Magazine * Rated #3 online broker in 2012 from #2 in 2011 * Ranked 5 stars in quality of trading tools and Research in 2012 Barron's Received 4.5 of 5 stars in the 2011 online broker review.	- High ratings for investment products and research capabilities. - Offers multiple types of trading platforms and are a broker for most advanced traders.
Overall Rating = 3.5 Stars E-Trade	$9.99 per trade for 0-149 trades/qtr. $7.99 for 150+ trades/qtr. ============= $2,000 Account Minimum**	SmartMoney WSJ Magazine * Rated #4 online broker in 2012 from #6 in 2011 * Rated 5 stars in Research and Trading Tools in 2012	- One of the highest rated online brokers in most categories. - Mid-tier pricing but sophisticated traders are willing to pay extra.
Overall Rating = 3.5 Stars Schwab	$8.95 per trade ============= $1,000 Account Minimum	SmartMoney WSJ Magazine * Rated #5 online broker in 2012, same as 2011. * Receives 5 stars for Research Tools	- Targets the the investor with mutual funds, bonds, banking services and branch offices. - Pricing is competitive with other high-end online broker category.

Information on Added Costs Per Trade

*    TradeKing - $4.95 per trade except add $0.01 per share for stocks priced $1.00 or less. $100 minimum per order
        in OTCBB and Pink Sheet stocks.
**   ETrade - Per Trade pricing tiered from $9.99 to $7.99 based on number of trades per quarter
*** Scottrade - $7.00 per trade except for stocks priced under $1, add ½% of the principal value. Most foreign and
       pink sheet stocks must be traded with broker assistance for a $27 commission.

About this Online Broker Comparison Chart

This Online Broker Comparison Chart looks at the most prominent online brokers from the perspective of a new trader or beginning trader. While there are many ways to compare brokers, including availability of investment products, banking services or sophistication of its trading platform, a beginner should be concerned at first with cost factors and overall service quality ratings.

Cost Factors

In order to get a complete view of total cost when you compare online brokers, look at all factors including trading fees (the cost to the trader for executing a single trade, whether a "buy" or "sell" trade. This can be misleading at first because buying a stock and then later selling it involves two trades. So a broker with $5.00 per trade fee will cost you $10.00 to buy and sell. A broker with a $10.00 per trade fee will cost you $20.00. After you sell a stock is when you determine your profit or loss and these fees must be included in your accounting. When you compare brokers, there are also some "additional" fees that are charged based on specific types of trades and these are outlined in the broker comparison chart above. "Per Trade" fees may also vary depending upon the number or volume of trades executed over a defined time period, with lower fees charged as trading volume increases. A "Flat-Rate" broker is one that charges the same "per trade" fee regardless of the type of trade or the volume of trades executed over a defined time period.

"Minimum Balance" and "Required Funding Amounts" are not a cost to you, but they take money out of your pocket and are a factor to be considered. One broker may require a minimum balance be in your account in order to maintain it while another may have no minimum balance. When you are setting up your account, this could mean the difference between depositing $400 into your trading account because that is what you want to start with, or having to deposit $2,500 in your account. A beginning trader may not want to deposit that much into their account initially, so that can be an important decision criteria when selecting your trading broker. The broker comparison includes these costs for you to compare brokers with complete information.

Quality Factors

An online broker's service quality is also important when you compare brokers. There is a broad range of quality across these brokers, but it is hard to determine these without direct experience. This online broker review, therefore, relies on the broker comparison ratings given by established and highly regarded financial publications including SmartMoney - The Wall Street Journal Magazine, Barron's, J.D. Power and Associates. These publications conduct annual broker reviews rating the brokers across a variety of service factors including the quality of customer support.

Since these publications conduct these trading broker reviews each year, there is a year-over-year comparative capability. This means that you can not only use their rating for the current year, but you can also see how that rating has changed since previous years. This can give you a good idea of how that broker is trending and areas where they are improving their service.

Star Rating

This review is primarily fact-based, reporting the brokers pricing schedule and fees policies and ratings given by the named publications. Based on the totality of the Cost Factors and the Quality Factors, a star rating is given to summarize that particular online broker's performance in that category relative to its competitors. The overall star rating can be used to directly compare brokers by combining the Cost and Quality Factor ratings, using equal weighting (50% given to each) to arrive at a summary rating that can be used to choose a broker you want to open a trading account with.

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