This week Barron’s announced the 2011 online broker review. In Barron’s 16th annual review it appears social networks and iPads are in, commission cuts are out, and there is a new leader. Online brokerages has definitely segmented into specific niches for traders, and the latest survey reflects this change.
It appears one broker cannot satisfy all your needs. Some brokers are better/cheaper with stock trades, while others are better with options. Other brokers offer zero commissions with certain ETFs or mutual funds.
While reading the article, one statistic I thought was interesting:
From what we know, Barron’s readers tend to have a portfolio topping $1 million and trade on average 42 times a year; they also have several brokerage accounts. We’ve tried to keep that audience in mind in providing information.
So most of their readers have a high net worth, are infrequent traders, and hold multiple brokerage accounts. In my opinion it’s not a surprise they have accounts with multiple online brokers.
Many of the online brokerage houses are starting to leverage social networking, online communities, and smartphones. It’s becoming increasingly harder to find an online broker that just offers basic stock trades. Over the past 20 years, commission fees have dramatically decreased. So much so that for awhile that Zecco had the freemium model. Barron’s predicts commissions have stabilized, and we should not expect changes in trading fees. I’ve included a summary of Barron’s top brokers for each category.
Best For Long Term Investing
| Name | Rating | |
|---|---|---|
| Fidelity | 4 1/2 of 5 | Sign Up Now |
| TD Ameritrade | 4 1/2 of 5 | Sign Up Now |
| Schwab | 4 of 5 | Sign Up Now |
| E*Trade | 4 of 5 | Sign Up Now |
| TradeKing | 4 of 5 | Sign Up Now |
Best For Frequent Traders
| Name | Rating | |
|---|---|---|
| TradeStation | 4 1/2 of 5 | Sign Up Now |
| MB Trading | 4 1/2 of 5 | Sign Up Now |
| Interactive Brokers | 4 1/2 of 5 | Sign Up Now |
| Lightspeed Trading | 4 of 5 | Sign Up Now |
| TD Ameritrade (thinkorswim) | 4 of 5 | Sign Up Now |
Best For Options Traders
| Name | Rating | |
|---|---|---|
| TD Ameritrade (thinkorswim) | 4 1/2 of 5 | Sign Up Now |
| tradeMONSTER | 4 1/2 of 5 | Sign Up Now |
| OptionsHouse | 4 1/2 of 5 | Sign Up Now |
| optionsXpress | 4 of 5 | Sign Up Now |
| TradeKing | 4 of 5 | Sign Up Now |
Best For International Traders
| Name | Rating | |
|---|---|---|
| Interactive Brokers | 4 1/2 of 5 | Sign Up Now |
| ChoiceTrade | 4 of 5 | Sign Up Now |
| TradeStation | 4 of 5 | Sign Up Now |
| optionsXpress (futures) | 4 of 5 | Sign Up Now |
| MB Trading (FOREX) | 4 of 5 | Sign Up Now |
There is much more information in the article, and I suggest you read it. Though you will need to be a Barrron’s subscriber, or you can pick up a copy at your local newsstand. Unfortunately, no where to be found was a review of Vanguard. I’m not sure why they were not included because they do offer brokerage services, but many do not consider them a serious player in the discount brokerage market.
