Which Online Brokers Are Best For Trading Stocks / Penny Stock Trading

Good Brokers:

1. Interactive Brokers – (Best direct access broker for “trading” higher priced stocks. Fast executions. Not great for lower priced since they charge .005 per share and they only route through NITE and ARCA for OTCBB and Pinksheets. None the less executions can be decent for lower priced stocks if you pay an extra .004 per share for ARCA.)

2. Speedtrader – (Great broker for OTCBB stocks or higher priced because commission is a fixed rate between $4 to $7 per order. Fast Executions, but you have to pay for Das Trader Pro software which is $120 a month however if you make about 20 trades a month the software is free. Best retail direct access broker in the world for active penny stock trading.)

3. Tradestation – (Good broker for higher price stocks and building trading system that use automated trading. Fast executions, $5 commissions or per share fee available. Not good for lower priced stocks including OTCBB and Pinksheets.)
4. Thinkorswim ( Decent broker for high priced stocks. You can also trade options and futures. Bad for penny stocks like OTCBB and Pinksheets.)

5. Etrade – Not great for active trading because they only send orders through their route ETMM, but good to have a means of sending orders through ETMM on OTCBB and Pinksheet stocks. Okay for swing trading. Don’t pay $100 a month for their Etrade Pro software.

7. Vanguard – Good for retirement accounts if you buy Vanguard Funds. No commissions when you buy Vanguard Index Funds. Terrible broker for lower priced stocks because you have to call them to execute the trade and they don’t allow pinksheets. Frtunately you shouldn’t be putting retirement money into penny stoc anyway. $7 per trade for first 20 trades and then $25 per trade.

Bad / Not So Good Brokers

1. Scottrade –> The worlds worst broker! Poor executions on high priced stocks. Terrible executions on OTCBB and Pinksheet stocks. Yes the commission is $7 but if  the slippage is $300 because they take 1.5 minutes to execute a trade, it doesn’t make sense to use this broker. On top of this their software is terrible!

2. TD Ameritrade –> The worlds second worst broker. Poor executions on high priced stocks. Terrible executions on OTCBB and Pinksheet stocks. The advantage is their stock data is free if you have account with just $100 in it. I use it as a backup for data only.

3. UBS – Poor executions, high commissions.
4. Schwab Poor executions high commissions.
Useful for routing to UBSS route in OTCBB and Pinksheet stocks

5. Fidelity – Bad broker, poor executions.

6. Sogotrade – Cheap commissions but poor exeutions.
Just2trade – Very cheap commissions by poor executions. Okay for swing trading.

7. Tradeking – I have nnoused it personally but have heard poor executions.

8. Zecco – Cheap commissions but poor executions.
Sharebuilder (ING Direct) – only good if you want to by a fraction of a share or a small lot. Just remember a fraction of 1 AAPL share probably won’t put your kids through college.

9. Firstrade – I haven’t used this broker but have heard they have poor commissions.

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