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Best Stock Brokers for August 2022

Many or all of the products here are from our partners that pay us a commission. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.

Over the long run, the stock market is one of the best places to put your money to work. But you can't just buy a stock through your bank account or call the company and buy shares -- you need to find one of the best stock brokers.

Fortunately for everyday investors, the brokerage industry has changed dramatically over the past couple of decades. To buy a stock, you used to have to call an individual known as a stockbroker, who placed the order on your behalf. This process was complex -- and expensive.

Now, most investors buy and sell stocks through online stock brokers. And competition among the best online stock brokers has never been higher.

If you're ready to jump into investing, we're here to help. Our team of experts has compiled a list of the best trading platforms and what you should look for to help you get started.

Ratings Methodology
Bottom Line

Merrill Edge® Self-Directed offers easily one of the biggest cash bonuses we’ve seen. It’s a standout brokerage with $0 online stock and ETF trades, strong research offerings, and excellent customer support. Owned by Bank of America, you can also get access to its fantastic Preferred Rewards program.

Fees:

$0 for online stock and ETF trades

Account Minimum:

$0

Special Offer

Open a self-directed account and get up to $600

Open Account for Merrill Edge® Self-Directed

On Merrill Edge® Self-Directed's Secure Website.

Bottom Line

SoFi has built a robust and valuable ecosystem to help manage your money in one place. SoFi Active Investing enhances that ecosystem with $0 stock commissions, crypto trading, and low account minimums.

Fees:

$0 for stocks, 1.25% for cryptocurrencies

Account Minimum:

$0

Open Account for SoFi Active Investing

On SoFi Active Investing's Secure Website.

Bottom Line

E*TRADE manages to cater to active traders with multiple trading platforms, while also appealing to long-term investors with thousands of mutual funds and ETFs that can be traded for free.

Fees:

Commission Free

Account Minimum:

$0

Special Offer

Open and fund an E*TRADE account & get up to $600 or more

Open Account for E*TRADE

On E*TRADE's Secure Website.

Bottom Line

TD Ameritrade stands out as one of our top rated all-around brokerage accounts with outstanding tools and products, in-depth and comprehensive research, and no account minimums.

Fees:

$0 stock trades

Account Minimum:

$0

Open Account for TD Ameritrade

On TD Ameritrade's Secure Website.

Bottom Line

Schwab has aggressively slashed fees on its mutual funds and ETFs, eliminated common account fees, reduced commissions to $0 per trade, and allows investors to buy fractional shares of stock, making it extremely affordable.

Fees:

$0 stock and ETF trades

Account Minimum:

$0

Bottom Line

Fidelity combines $0 commissions, top-notch research, and an excellent mobile app, all in a simple online platform. With $0 account minimums and zero-expense-ratio index and mutual funds, this is one of the most affordable stock brokers.

Fees:

$0 commission for online US stock and ETF trades

Account Minimum:

$0

Bottom Line

It's not the best stock broker for more active traders, but Vanguard remains a top option for passive investors with excellent zero-commission options for index funds and ETFs.

Fees:

$0 stock and ETF trades

Account Minimum:

$0

Full-service vs. discount brokers

Just as the process for processing stock trades has changed, the terms we use for the people and businesses who facilitate trades has changed, too. Today, instead of using the term "stockbroker" as an all-encompassing term for any person or brokerage firm that deals in stocks, we generally divide companies into two categories: "discount brokers" and "full-service brokers," labels that better describe what they actually do.

Discount brokers

Online stock brokers are discount brokers. They aren’t in the business of giving you advice or phoning you up with stock picks. Instead, discount brokers focus on the very basic service of helping you buy or sell a stock (or other type of investment) from the convenience of your own home. Because discount brokers forgo many of the frills, they can charge rock-bottom prices for their services. The best online stock brokers charge $0 to place a stock trade -- a bargain, especially considering what traditional brokers charge. In addition, discount brokers tend to have lower minimum investment requirements (or no minimums at all), making them accessible to everyone.

Full-service brokers

Brokerage firms we label "full-service brokers" are more closely related to the stockbrokers of days gone by. Full-service brokers often employ human brokers who can help you make a trade, find mutual funds to invest in, or make a retirement plan. That said, full-service brokers are costly, since people are inevitably more expensive than computers. A popular full-service broker charges a minimum of $75 to place a stock trade, and that can jump as high as $500 or more to buy a large amount of stock. Buying a mutual fund through a full-service broker can potentially set you back thousands of dollars, since they often charge fees equal to a portion of the amount you invest. Full-service brokers are more likely to have higher account minimums; some advisors only work with clients who have $1 million in assets or more.

Realistically, the lines between the two types of brokers are starting to blur. Discount brokers now have wealth-management services that offer the help of a human advisor at a full-service price. Some full-service brokers also offer a basic level of service at discounted prices. For example, Merrill Edge® Self-Directed is the discount brokerage arm of the full-service brokerage Merrill Lynch.

What is an online stock broker?

An online stock broker is a financial firm whose customers can buy and sell stocks in a brokerage account through an online trading platform. You can think of an online stock broker as a conduit to the stock exchanges. In exchange for a commission on every trade, these brokers send your orders on to stock exchanges and market makers, which actually do the heavy lifting of matching your buy order with someone who wants to sell, or vice versa.

You and I can’t knock on the doors to the stock exchanges and make a trade without a broker. In truth, the stock exchanges as we think of them from their depictions in movies and on TV don’t really exist today. Most trading actually takes place between computers in dimly lit server rooms in New Jersey, a few miles from New York City’s financial district.

LEARN MORE: Best stock brokers for beginners

How to pick the best stock broker

The best online brokerage account for you depends on your needs. Here are a few things you might want to consider:

  • If you plan to simply buy and hold stocks, you probably don't need a full-featured trading platform.
  • If you primarily plan to buy mutual funds, you should look for the best mutual fund broker, since these brokerage accounts offer low to $0 commissions to buy and sell mutual funds.
  • If you are a brand-new investor and only want to invest a few hundred dollars at first, you'll probably want to look for a broker with no minimum investment requirement.

If you plan on trading bonds or stock options, or plan on making trades over the phone as opposed to online, be sure to compare what each the best stock brokers charge for these activities.

TIP

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Features of the best trading platforms

The best brokerage accounts on our list offer different free stock trading apps, different educational resources, and more. With that in mind, here are some of the features we looked at when deciding which online stock brokers were the best in the business, and why they matter to you:

  • Commissions and fees: Basic, online stock and ETF trades should be free. Period. Investors now pay $0 commissions at most online stock brokers, and some even offer options trading for free, which can be particularly valuable for active traders. Even some of the best online brokerages charge commissions for mutual fund trades and other services you might need, so it's still important to compare fee structures.
  • Mutual funds: While most brokers charge a commission for mutual fund trading, it's also important to know that most have a list of hundreds or even thousands of funds that trade with no commissions at all.
  • ETF investing: The best ETF stock brokers will not only have $0 online commissions for ETF investing, but they also tend to offer access to a wide array of branded, low-cost ETFs. These branded ETFs are managed by the stock broker's analyst teams themselves and they often include rock-bottom expense rations.
  • Options investing: A well-rounded stock brokerage account will not only offer access to investing in stocks, ETFs, and mutual funds, but also options. The top options trading platforms tend to include $0 commissions for online options trades and high-quality trading software across online, desktop, and mobile devices.
  • Account minimums: Many of our favorite online stock brokers don't have account minimums, but a few do. If you're a beginning investor, it's important to verify that you can meet any minimum investment requirements before you select a broker.
  • Trading platform: Some stock brokerage accounts have full-featured and complex online stock trading platforms and software available to frequent traders, as well as managed portfolio services from robo-advisors. Other stock brokers take a more simplistic, user-friendly approach. And many have top-notch investing apps that could come in handy if you want to buy and sell stocks from anywhere in the world.
  • Research and screeners: One key reason to have an online brokerage account is that you can access a second opinion when you need it. Many brokers offer a full suite of third-party research as well as stock and fund screeners so you can find, for example, the annual fees for investing in a fund, or get help sorting through your choices via parameters like price-to-earnings ratio.

Fees for the best brokerage accounts

With so much competition among the best brokerage firms, consumers benefit in one of the most important areas for successful long-term investing, commissions and fees. It's table stakes nowadays for brokerage accounts to offer commission-free online trading for stocks and ETFs. It's becoming even more common for $ commissions for mutual funds, cryptocurrencies, and fixed-income investments. Here's a rundown of common fees for our picks of the best brokerage accounts.

  • TD Ameritrade: $0 online commissions for stocks, ETFs, and options ($0.65 per contract)
  • Robinhood: $0 online commissions for stocks, ETFs, options, and cryptocurrencies
  • Webull: $0 online commissions for stocks, ETFs, options, and cryptocurrencies
  • SoFi Active Investing: $0 online commissions for stocks and ETFs
  • Fidelity: $0 online commissions for stocks, ETFs, and options ($0.65 per contract)
  • Interactive Brokers: $0 online commissions for stocks, ETFs, and options ($0.25-$0.65 per contract)
  • E*Trade: $0 online commissions for stocks, ETFs, and options ($0.65 per contract)
  • Merrill Edge: $0 online commissions for stocks, ETFs, and options ($0.65 per contract)
  • Charles Schwab: $0 online commissions for stocks, ETFs, and options ($0.65 per contract)
  • Vanguard: $0 online commissions for stocks, ETFs, and options (Up to $1.00 per contract)

The lowest commission stock broker will depend on the type of trading you do in your brokerage account. Robinhood and Webull are the lowest commission brokerage accounts across stocks, ETFs, options, and cryptocurrencies -- they don't charge commissions.

But these selections aren't the best online stock trading picks for active traders who are focused on these commissions, as well as the quality of the trading software and margin rates. TD Ameritrade and Interactive Brokers combine robust trading software with low commissions and competitive margin rates.

What is the best stock broker mobile app?

Since so many people use their mobile devices for financial activities these days, it's worth noting that most of our favorite online brokers are also the ones with the best free investing apps. Some are mobile-focused, like Robinhood, while others simply use mobile apps to offer their customers an additional way to trade stocks.

Unfortunately, there's no one-size-fits-all answer for which brokerage firm has the best mobile app. Some people prefer a user-friendly app that makes it easy to buy and sell stocks, while others prefer a mobile app packed with features for active traders and serious investors. But if you anticipate doing a fair amount of trading through your mobile device, looking at each broker's mobile app should be a large part of your evaluation process.

LEARN MORE: Best investment apps

Top brokerage firms

Many of the top brokerage firms are well represented on our list of brokerage accounts to consider. Below we've included a rundown of the top brokerage firms based on assets under management as of 2021.

  1. Charles Schwab: $7.614 trillion
  2. Fidelity: $4.228 trillion
  3. Bank of America/Merrill Lynch: $3.693 trillion
  4. J.P. Morgan: $3.00 trillion
  5. Robinhood: $0.81 trillion
  6. Ally Invest: $0.16 trillion

MORE RESEARCH: The largest stock brokerage firms

Broker/Advisor Best For Commissions Next Steps
Merrill Edge® Self-Directed Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Customer support

Commission:

$0 for online stock and ETF trades

Robinhood Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Low fees

Commission:

$0 for stocks, ETFs, options, and cryptocurrencies

SoFi Active Investing Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Managing your finances under one roof

Commission:

$0 for stocks, 1.25% for cryptocurrencies

E*TRADE Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Mobile platform

Commission:

Commission Free

Webull Offer Image
Rating image, 4.0 out of 5 stars.
Rating image, 4.0 out of 5 stars.
Best For:

Mobile investing

Commission:

$0 per trade

TD Ameritrade Offer Image
Rating image, 5.0 out of 5 stars.
Rating image, 5.0 out of 5 stars.
Best For:

Research

Commission:

$0 stock trades

Charles Schwab Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Retirement investors

Commission:

$0 stock and ETF trades

Fidelity Offer Image
Rating image, 5.0 out of 5 stars.
Rating image, 5.0 out of 5 stars.
Best For:

New investors

Commission:

$0 commission for online US stock and ETF trades

Interactive Brokers Offer Image
Rating image, 4.0 out of 5 stars.
Rating image, 4.0 out of 5 stars.
Best For:

Active traders

Commission:

As low as $0 stock trades

Vanguard Offer Image
Rating image, 4.5 out of 5 stars.
Rating image, 4.5 out of 5 stars.
Best For:

Passive investors

Commission:

$0 stock and ETF trades

FAQs

  • Most online brokers don't charge commissions for online stock trades. However, there may be commissions for other types of investments like mutual funds and options, and brokers have their own fee schedules for various other services. The best pick for you depends on what services and investments you anticipate using the most.

  • Thanks to zero-commission online stock trading and many brokerage firms offering fractional shares, it's easier than ever to diversify. If your goal is to create a diverse portfolio of individual stocks without a large upfront capital commitment, be sure the broker you choose has both of these features.

  • Yes. If your account is with a brokerage firm that is a member of the Securities Investor Protection Corporation (SIPC), cash and securities in your account are protected from loss due to broker failure, up to $500,000 ($250,000 for cash). However, your money is not insured against losses that result from declines in value of the investments in your account.

  • This depends on your goals. If you want to occasionally buy and sell stocks, a standard (taxable) brokerage account could be the best choice for you. If you want to save for retirement and/or reduce your taxes, a retirement account like a traditional or Roth IRA might be better. There are other specialized brokerage account types as well, and you can usually find a list of the types offered on your broker's website.

  • Some online brokerage firms have required minimums, but the amount you need to get started has more to do with what you invest in than where you open an account. The minimum investment amount depends on your broker and the type of investment. Most mutual funds have minimum investments of around $1,000, though there are notable exceptions. Since a major advantage of investing in ETFs is that they trade like stocks, the minimum is the price for one share. Last but not least, the minimum to start investing is typically the price of one share, but if your broker offers fractional shares, you may be able to invest even as little as $1.

Expert Opinions

Irena Vodenska, Ph.D., CFA

Irena Vodenska, Ph.D., CFA

Professor of Finance, Director, Finance Programs, Administrative Sciences Department, Metropolitan College, Affiliate Faculty Global Development Policy Center

What advice do you have for a first-time investor?

First-time investors could be very different, so a single piece of advice is probably not appropriate for all of them. If we assume that the first-time investor is a young professional, for example, in their first job right after school, they have a long investing horizon in front of them. Hence, they could be more aggressive in selecting a portfolio, mainly comprising domestic (U.S.), or even international equity. These young investors are in their savings part of the investment horizon and do not require short-term liquidity so that they can afford riskier investments, at least with a portion of their portfolio. Another consideration is the level of the risk-averseness for these first-time investors. Even if they have a long-term investing horizon and low liquidity requirements, first-time investors may opt for safer investments if they are very risk-averse. In that case, instead of equity (stocks), fixed income securities (bonds) will be more appropriate.

What is a common misconception about investing?

Investing is an individual choice. One of the common misconceptions about investing is that investments always have positive returns, i.e., if you invest, you will earn money at all times. This belief might be true on average, measured as a cumulative return over many years. However, the performance of an investment portfolio could be volatile, i.e., experiencing both negative and positive returns periodically. Another misconception about investing is that anyone who invests in financial markets will become rich quickly. While this might happen, it is not the norm but rather an exception. A third misconception could be that investing is trading, which is not the case. One can think of trading as short or very short-term investing; however, investing, per se, implies a long or a very long-term holding of the purchased securities, accompanied by a low-frequency rebalancing of the portfolio.

How can investors feel more confident when choosing a brokerage?

Excellent question. Investors should consider very carefully whom they will be choosing to trust with their investment decisions. There is a distinction between a brokerage and an investment advisory firm. Brokers engage in the business of effecting transactions in securities for the account of others, for which they receive compensation. When brokers recommend securities to their clients, they must ensure that the investment is "suitable" for the client. On the other hand, investment advisors advise others about investing in securities and receive compensation for the advice. When investment advisers recommend an investment to their clients, the investment needs to be in "the best interest" of the client. These differences are essential and create two different standards of conduct: 1) Suitability for brokers and, 2) Fiduciary ("best interest of the customer") for investment advisers. Investors should know the difference, and before entrusting their investments to securities professionals, they should ask whether they are a "fiduciary"? Investors can be confident if the answer is "Yes, I am a fiduciary."

Reena Aggarwal, Ph.D.

Reena Aggarwal, Ph.D.

Director, Center for Financial Markets and Policy at Georgetown University

What advice do you have for a first-time investor?

One should start investing as early as possible, even if it is with a small amount of money. The magic of compounding is real and in the long run even this small amount can grow into a large amount. You should consider how much risk you are willing to take, and risk-taking also depends on the stage of your life cycle. Generally, young investors can afford to take more risk than retired people who are counting on their savings during retirement.

What is a common misconception about investing?

A common misconception is that I can beat the market and make a quick buck. It is rare for anyone to beat the market on a consistent basis. Markets don't always keep going up; you should consider the implications of both bull and bear markets on your portfolio. It is a good idea not to put all your eggs in one basket and instead have a diversified portfolio.

What are some investing trends that new investors should be aware of?

Retail investors have become more active participants in the financial markets, particularly during COVID. There has been a lot of interest around platforms for retail investors, allocation of IPOs, and popularity of products such as special purpose acquisition companies (SPACs) and crypto products. It is important to do your due diligence before investing in any asset. Regulatory agencies such as the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) provide useful alerts and bulletins that are worth checking.

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