5) Brokers and Online Trading: Choosing A Broker
What’s Your Style?
Choosing a broker is your next step into investing in stocks. Whether you want a full-service or a discount broker is your decision. As the investor, you should know your motive for investing, your objectives and needs, therefore choose a type of broker that suits you well. As a newcomer in investing, getting guidance from someone with the expertise is recommended. If you have the money to spare, a full-service broker would be appropriate for someone like you. Of course, taking charge of your own portfolio can be a very rewarding and profitable experience. However, losing money on commissions is definitely better than wiping out your portfolio because of your lack of experience in the market.
Check the Background
Checking the background of the broker for any past disciplinary problems should be taken when choosing for one. Thankfully, this information has been made rather easy to access through the Central Registration Depository (CRD). You can search online and request for a detailed report on the NASDR website.
Another way is to ask your state securities regulator to provide you with the necessary information from the CRD. Visit the North American Securities Administrators Association website for information on how to contact state regulators.
Furthermore, you can also visit popular web forums that deal on securities trading and finance, and ask about any brokerage. Many forum members will be more than willing to share their good and bad experiences with that broker. If not, I’m sure someone has already said something about a particular broker, so a quick search on the Internet should yield you several results.
Many of the information in this section are specific to the United States. Each country has its own way for checking the background of brokers, so it is best that you contact regulators in your home country for more information.
- 1) Brokers and Online Trading: Introduction
- 2) Brokers and Online Trading: What Does A Broker Do?
- 3) Brokers and Online Trading: The Costs
- 4) Brokers and Online Trading: Full Service Or Discount?
- 5) Brokers and Online Trading: Choosing A Broker
- 6) Brokers and Online Trading: Accounts And Orders
- 7) Brokers and Online Trading: Conclusion