It's time to select a broker...

[wheezledick]

Well, I've read, studied, and stressed over this subject of trading for almost a year now, and I think the only thing holding me back now is being chickenshit. The two stocks I'm holding from an old employee stock purchase plan have run up about 30% since September, and I think it's time to make the jump. I believe I've asked this before, but I'd like any input I can can get on selecting the best online broker that suits my needs. From what I've seen, I'm leaning toward Scottrade. As I've read all the posts here these past months, I've noticed that they all have their own quirks and peculularities., such as the abilitiy to trade pink and OTC stocks, plus the surcharges for doing so, inactivity fees, and charges for the "extras". I'm also interested in their reliability and customer service. One more question. Are Level II quotes manditory for success at this? Thanks in advance for your time, folks, and season's greetings to all.

D'Wheeze

[wheezledick]

Ideas, anyone? I don't want to get stuck with a lousy broker on some introductory deal, I just want few if any restrictions, good CS, and quick, honest trades.

[ASR831]

It depends on what are your needs .. Account Size/Trade Size ... How many trades do you place a year? Do you care if you want to trade Mutual Funds? Do you need advanced orders such TTO, Time Triggered, etc.? Do you want to place your trades overnight? Do you care if it is only web based or software based? Answering what you actually need can eliminate a lot of the brokers and narrowing the list. Try to narrow it to as low as two but no more than 5. When you come up with a list, it will be more focused and I will be willing to help and tell you about those "extra" fees some brokers charge? I have done an extensive study on most brokers in the US 

I am with MB Trading and Ameritrade. Both have been good to me but Ameritrade always lacks on giving me the best price when I place a trade with them. Margin Rate on Ameritrade is high too so I don't go on margin with them.

Here is a site with most brokers and their ratings:
http://www.elitetrader.com/br/

Another one that focuses on the main brokers in the US:
http://www.stockbrokerguide.com/usa_stockbrokers.php

Hope this helps!

[Lucas Scott]

Wheezie - I've been with Ameritrade in one form or the other since I started. Thus I can't really compare it to other brokers other than to say I've been happy with them for the most part.  I use Ameritrade Izone which is $3 per trade. To get Izone you have to pay a $50 a year annual fee. Pretty much a no-brainer if you plan to make a couple trades a month (the standard (non-Izone) Ameritrade is $5 per trade).  As to ASR's comment that Ameritrade doesn't give the best price, I think he's talking about market orders. I usually use limit orders unless the stock is super-liquid with a 1 penny spread (i.e. SIRI). If I want to buy a stock immediately, I look at it on Level 2 and place my limit order at the ask. And if I want out of a stock immediately I look at L2 and set my limit at the bid. Works 99% of the time.  Another nice thing with Ameritrade is you can buy and sell OTC's or pink sheets (ugh) with no restrictions. You can buy 1 share or 100 million shares and they charge you a flat $3.

Another broker I've looked at but as of yet have not test-driven is Interactive Brokers. Very good word of mouth with IB. One thing I know IB offers that Ameritrade does not offer are bracket orders. That's where you can set a limit order that says "Sell XYZ if it gets to $9.50 or sell if it falls below $8. That way you can set your exit price above and below the current price. With Ameritrade and most other brokers you have to pick one or the other.

I wouldn't consider Scottrade if I were looking for a broker. I'd go Ameritrade or Interactive Brokers.

[AussieTrader]

Quote Lucas Scott: That's where you can set a limit order that says "Sell XYZ if it gets to $9.50 or sell if it falls below $8. That way you can set your exit price above and below the current price. With Ameritrade and most other brokers you have to pick one or the other.

Hey Lucas, not sure with Izone, but my Ameritrade Apex account has what they call trade triggers, basically with these you can set bracket orders that will execute when the condition is met (i.e. stock falls to your stop loss price or reaches your profit target). I use them all the time with my positions and they work well and are very flexible. Also they are not orders visible to the market they do not activate until the pre determined condition happens then an order is sent to to be executed.

Good luck with your choice  Wheeze