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Thread: How important is a cheap broker for a beginner?

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    AbardinaSa Guest

    Default How important is a cheap broker for a beginner?

    I am a starter in online trading.

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    I want to find a broker which has cheap broker. But how good are they?

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    It is really important when you're starting because if you're spending $10 on commission that $20 per trade at the least, the more you spend on commission the more hesitant you'll be to sell a stock that's not doing well. Also selling half of your position is usually a really good strategy but when it costs you $10 to do that and you're playing with a small amount it really adds up

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    Here's a cheat. Sign up for Ameritrade and use their free tools. Then get a cheaper broker to actually place trades. Most cheap brokers you have to pay for their platform or tools. So use their web based trading while using Ameritrades free platforms for scans and charts. Simple. Until Ameritrade starts charging unless you have so much in your account. It'll probably happen eventually; but for now its pretty nice for new traders looking to get their feet wet.

    Also if you don't have $25,000 and want to day-trade, check out SureTrader. My trading group has a deal on with them. I can get you a better commission rate and we have a direct contact for customer service. So if you want to trade with us while getting a deal with a broker with as little as $500 down to day-trade, contact me.

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    Another thing to consider is that you can negotiate your commission fees. I have been with e*Trade many years and I have cut my commission fees in half just by going back to them each year and asking them to lower it. It was initially was $9.99 / trade, now it is $4.99 / trade. I like using their tools e*Trade Pro so that's why I have stuck with them vs. going to a low fee brokerage such as Interactive Brokers. But, it suits my trading style, as I'm using larger position sizes, so the fees become negligible during a trade.

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