Since you (hopefully) will always have at least some money in your penny stock trading account, another area to check out is the amount of interest that money will earn. Prior to investing in the penny stock market, it is essential for you to open a brokerage account. If you plan to trade penny stocks, you must pay attention to the penny stock broker’s commissions and transactions fees since they will eat away at your returns.
Scottrade is an excellent choice for beginner penny stock traders and those who invest in mutual funds, and long-term (buy and hold) investors (mainly because of no account inactivity charges).
OptionsHouse is an online penny stock and options broker that provides a professional trading platform with a flat-rate commission structure for low-priced stock and options trades.
TradeKing is an online broker providing low flat trading fees with no minimum account requirements and no hidden fees.
Commissions – Although the significant difference between the two types of brokerage services is the fee of each transactions based on the extent of work like providing penny stock picks, disparity in commission fees between two services of similar kind can be huge. Opening Balance and Maintenance Charges – Note that every broker sets a specific opening balance requirement. Research, Perks, Investment Tools and Services – You should realize that there are no brokers that furnish the same set of research, perks, investment tools and service to their clients.
You should be able to find a penny stock broker who will efficiently fulfill some of the important tasks when investing. Because Scottrade is a stable, seasoned penny stock brokerage firm with a good reputation, it is the natural choice for people who don’t trust their money with newer companies but also don’t want to pay $10+ for trades with other established brokers. TradeKing online penny stock brokerage accounts offer easy-to-use investment tools with low flat trading fees and no minimum account requirements.
While a discount penny stock broker may charge $30 each trade, another may only charge not more than $10. You should exercise extra caution though, there are brokerage firms that offer low opening balance but will let you incur huge maintenance cost if your balance goes down on a certain amount.
By keeping these factors on your sleeve together with the right attitude, you’ll surely get the best penny stock brokerage firms out of your personal penny stock trading account.
They have received the maximum 5-star rating for their customer service in SmartMoney’s 2011 broker survey, making them a solid choice for people who require assistance opening and maintaining their brokerage account. Thus, it is critical for you to search around and compare quotes of brokerage firms before opening an account with them. Interactive Brokers has the single worst customer service of any company, financial or otherwise, that I have ever dealt with and if you have any issues with trades, executions or software glitches, expect them to screw you…because they only care about their bigtime hedge fund clients, not about anyone with less than $1 million and certainly not anyone with less than $100,000.
The broker may give you the list of penny stocks, but you will perform most of the online trading tasks.
Traditional brokerage firms, on the other hand, integrate working with a personal stock broker. These services can include stock research, trading advice, retirement planning, tax tips, and more. The broker will show you investment ideas, make reports concerning your investment portfolio, present you a run-down of your investments’ performance, and at all times be available with just a phone call or email so you can purchase or sell penny stocks. Of course, this comes at a price, as full service brokers are more expensive than discount brokers. Speedtrader is another online discount broker I use for my long positions as they are competent and their commissions are extremely low. If the funds are available, a full service broker can help a novice penny stock investor who is still learning how to trade or those who need a little guidance. You can always graduate into trading through a discount broker as you gain more experience in penny stock trading.Discount brokers offer much lower commission rates on trades because of their limited client services.
Joking obviously & not encouraging you to lie, but just walk into any bank, most likely easier if you have an account there, and ask them if you can use them as a reference for a new brokerage acct that you are starting.
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