Before you can begin trading stocks online, you first need a brokerage account. In order to get one, you have to sign up with a stock broker. They are necessary on the execution of trade as it is carried out through them. But this being the internet and the choices so vast, how do you narrow down your picks to select the best option? Here are tips to help you out:
Pick a full-service broker
A full-service broker offers a range of services for their clients which include providing research and advice, retirement planning and offering tax tips – just to name a few. But given the kind of service they provide, it’s only natural that their commissions are a bit higher compared to a discount broker.
One of the advantages of signing up with a full-service broker is the expertise they can provide. For instance, if you’re extremely busy and haven’t kept up to date with issues that are complicated, full-service brokers can help you out.
Then again, when all you want to do is execute trades, you can go for discount brokers.
Make sure they are online at all times
A website breakdown during peak hours is something you don’t want in your broker. So if you have a list of potential list of candidates, try out their websites at different times and particularly during peak trading hours. Observe how fast their site loads and add in some link checking to make sure that there are no technical issues.
Check if they offer alternative trading services
An alternative trading service just means having the option to trade without using the internet. As much as our lives have now become glued to computers, there are instances when we don’t use them. So check whether your broker offers placing trades through telephone, fax and other alternatives.
Read up on the broker’s background
Reviews are not so hard to come by these days. A simple search on Google will reveal many things – some good and some bad. Plus, there’s social media as well where you can search to see whether mentions of a broker is more good than bad.
Of course, almost every firm will get an equal share of bashing and praising. It’s up to you to make the final decision. In case your still in doubt, try getting in touch with other online traders and learn about their experiences with their brokers.
Learn about their other product selections
Buying stocks isn’t all online trading is about. There are other investment vehicles such as municipal bonds, futures and options. If you’re interested in buying or selling more than just stocks, than it’s best to pick a broker that already has a varied portfolio.
Test their customer service
How a company treats their customers is very important when it comes to getting the best services. For your part, you can do some investigation on how well a broker’s customer service is by calling them up and see how they respond. Come up with a fake question to ask and judge them by the time it takes to have your call answered to the way your question was answered.
Look into extra offers
Some brokers offer extra services and it’s a good idea to check these out. While it may or may not affect your overall decision, knowing that you can get something extra is always a nice thought.
The internet has given us the option to buy and sell stocks without having to dress up. But in order to do it successfully, we need all the help we can get. And that’s what a stock broker is there for.