Many people invest their money in the market, while some people only pay attention to the cost per transaction, there is really much more to it when picking out an online broker. It is the same as buying a car, you don’t just pick the cheapest one since the quality is not the same. I have used three online brokers so far and thought I would share my experience with them so that you know what is going on before you put your money in their hands.

      The three brokers that I have used are(in no particular order): ShareBuilder owned by ING Direct, Scottrade, and TDAmeritrade. Below are their individual reviews with pros and cons to their service.

ShareBuilder:
     Sharebuilder claims that you can start investing and place trades for $4 which is true however what you don’t know is that their $4 trades are automatic trades. This means that you must set a certain schedule to invest your money, and it is purchased at the market price. Trades only occur on a Tuesday and if you do sell you must sell normally which is their $9.99 fee. Of course selling is instant but it is something they didn’t mention. One good thing I must admit for their automatic investment is that they will purchase partial shares so if you only had $100 to invest in google and the price is $500 you would get .2 shares of its stock. Another good bonus is that they offer packages, so you can place 20 automatic trades a month for $20 which is not a bad deal if you want to just sit back and dollar cost average into the market. Now these are small issues that I could get by, but there are a few larger issues that I have a problem with. First their instant trading which costs $9.99 is actually a little slow, while it does purchase the stocks while the market is open, I have noticed that the trades execute slower than the other two brokers. The 2nd issue is that they have fees if you don’t login after a year or two which some people may forget since they made the automatic investment so easy to use. The last issue is the fact that they charge extra if you sell more than 1000 shares, this was just wrong since there are many stocks very cheap at the moment and it is easy to pick up a few thousand shares of a company.

Pros:
- Cheap if using automatic investment
- Programs packages for people that use the automatic trade frequently

Cons:
- Slow trade execution
- Fees (on trades over 1000 shares and inactivity)
- Selling isn’t $4
- Don’t have much online research tools

Scottrade:
      Scottrade was introduced by my sister who said it was a decent broker that charged $7 transactions for everything. Well they were right everything was $7 and the speed on executing transactions was fairly decent. This broker is actually pretty good, there is only 1 downfall…. They don’t allow automatic dividend reinvestment. This is a big killer for me since many of my stocks have dividends, if you don’t care about this then it is a good broker otherwise I would choose something else. I’d suggest the next broker…

Pros:
- Cheap and fast execution
- Decent amount of research tools
- Straight forward price

Cons:
- No dividend reinvestment

TDAmeritrade:
      TDAmeritrade, I have had a pleasant experience with them, and their commercial is true. They really don’t have any hidden fees. It is very straightforward with them, each trade is $9.99 and the speed is great. They also do have a large number of online tools and applications they have tailor made to work with TDAmeritrade. Of course you pay more for the transaction cost but I think it is worth it.

Pros:
- Fastest Execution on trades out of the three
- Large number of research tools
- No hidden fees

Cons:
- Cost the most per transaction at $9.99 for everything

     Hope this helps you decide what you need for an online broker. If you have specific questions feel free to message me or leave a comment and I’ll let you know.