Evaluate your online broker

Commissions

When you buy or sell stocks using the online account, you will be charged a fee for the execution and clearing of your trade. Generally, your commissions per trade will decrease the more trades you execute. Most brokers have a lot of fine print, qualifications conditions and make you do a large number of trades before you are eligible for lower pricing. Today you don’t have to trade often to get low commissions. Choose a broker that gives you the best price right at the start.

Administration fees

Take a close look at this because some brokers may build in extra fees for inactivity or other services. You don’t need that.

Access through telephone

Stock trading is a time sensitive business. There can be interruptions caused by power or internet services, but this should not tilt the balance of your trading activity. Therefore, your online broker should be accessible on phone at all reasonable hours. Without this facility, the online broker does not deserve even a good look.

Automate and Win

The nature of trading online has changed dramatically in the last 5 years. Before, you had to work in the industry to have access to the news, information and tools that moved markets. The internet has made getting information much easier for everyone and access to better tools means the online trader can have the same power that used to be reserved only for professional traders.

If you are starting to trade online, it is important that you are able to choose a trading platform that meets your needs and skill level. Make sure you have access to real-time quotes on your platform. With fast moving markets you do not want to be trading on information that is 15 to 20 minutes old.

Unless you plan to trade full time, make sure that you can enter orders with specific criteria of when to buy, or sell, at the start of the day. This way you won’t have to constantly check your orders throughout the day.

Technical analysis (the study of charts) has gained tremendous popularity recently. Working with a trading platform that has integrated charting functions can be very useful in helping you determine your strategy for a particular security.

Lastly, you should choose an online broker that has knowledgeable staff. Too many brokers employ call center staff that are more familiar with banking procedures than online trading. You want to be speaking with people that follow the markets just like you.