Fidelity Investments was founded in 1946 as Fidelity Management & Research by Edward C. Johnson II. It’s largest business is their suite of mutual funds, the largest of which is their Fidelity Contrafund, posturing over $107 billion in assets. Beyond mutual funds, Fidelity has a diverse range of financial services, including their brokerage firm, investment advice, life insurance to name just a few.
Type of Broker
Fidelity is part of the “big five” brokerage firms, operating as a discount brokerage firm for the mass of individual investors, as well as providing brokerage services to a range of institutional clients including other broker-dealers, financial services firms, and institutional funds. Fidelity’s brokerage branch handles of $443 billion in assets, as of 2010.
Fidelity’s standard investment account, “The Fidelity Account” has a minimum initial deposit of $2,500 in cash or securities. Fidelity requires no minimum account balance once you have made your initial deposit.
Commissions & Fees
Commission Prices (Stocks)
All online U.S. equity trades are charged at a flat rate of $4.95 per trade, with no progressive fee reduction or per-share fees.
Commission Prices (ETFs)
Like many of the top brokerages nowadays, Fidelity offers a series of commission-free ETFs. Below is a table outlining Fidelity’s ETF fee structure.
Purchase 70 iShares ETFs online
Purchase 11 Fidelity sector ETFs online
Purchase 3 Fidelity active fixed income ETFs
Purchase 6 Fidelity factor ETFs online
All other ETFs
Commission Prices (Options)
All online options trades
$4.95 per trade, plus $0.65 per contract
Buy to close orders of $0.65 to $0.11
Buy to close orders of $0.10 or less
While Fidelity charges no fees for any of its software offerings, they do require a minimum of 36 trades placed in a year to qualify for their premium trading software Active Trader Pro. Their mobile app and website interface are free to all clients.
Like most brokers, Fidelity charges a range of fees for different account activities. Often times, these “hidden” fees can make a break a trader’s use of a broker. The table below outlines various account fees charged by Fidelity.
Selling a commission-free ETF within 30 days of initial purchase
Mutual fund low balance fee
$12 per year
$10 per transaction
Foreign currency wires
Up to 3% of principal (charged when converting USD to wire funds in a foreign currency
1% of principal
$38 per transaction
Returned or stopped checks
$15 per transaction
$15 per transaction
Transfer Limited Partnership Positions
$75 per partnership
Transfer and Ship Certificates
$100 per certificate
$10 per transaction
The account fees are unlikely to make or break any investor. These are standard in the industry and most can be avoided by funding an account online.
Fidelity claims to have the the most competitive margin rates in the industry.
Base – 3.075%
Base – 2.825%
Base – 0.500%
Base – 0.250%
Base – 0.200%
Base + 0.750%
Base + 1.250%
Platforms & Tools
Fidelity offers three different platforms from which to manage your account. One advanced, one basic web, and one basic mobile platform.
Active Trader Pro
Active Trader Pro is Fidelity’s premium trading platform offering. In order to get access to the platform, you must make 36 trades per year.
Active Trader Pro is Fidelity’s trading platform to compete with the other advanced platforms of the top brokers like TD Ameritrade’s ThinkOrSwim or Schwab’s StreetSmart Pro. Because of this, it offers very similar features such as:
Real time streaming market data
Real time analytics
Proprietary trading tools like Strategy Ideas and Trade Armor
Free to all clients, Fidelity’s web platform is basic and similar to most of their competitor’s web platforms, however, while not lacking in functionality, the user interface looks visibly dated.
Any basic investing function like quotes/price charts, news, analyst reports, etc. is easily accessible on Fidelity’s web platform.
Fidelity Investments Mobile
Fidelity has a very well-supported and well-received mobile app. Using five simple tabs, it’s easy to navigate and has a well designed, user-friendly interface. It looks as if the designers got some inspiration from the minimalism of the Robinhood app.
Any basic feature expected of a mobile investment app is included. Price charts, quotes, watch lists, and simple market summaries, just to name a few.
One of Fidelity’s strongest points is their research offerings, not only do they offer the most equity research options in the industry, they also have unique methods of visualizing their data into a quick, digestible format.
Fidelity offers research from top firms like Ned Davis, Reuters, and Recognia. With research from over 20 firms, it can seem overwhelming, almost useless to house that many providers, but each provider has their own unique style and biases. Clients can take a quiz to find which research provider matches their trading/investing style the most.
These research tools are best for investors who incorporate fundamental analysis into their trading decisions.
Fidelity offers 24 hour customer service via phone, and live chat customer service for 14 hours of the day. Additionally, clients can go to Fidelity’s local Investor Centers and talk to an account advisor in person.
Executions & Routes
A Fidelity client cannot get direct market access without being a client of their institutional service, Fidelity Capital Markets. This is to be expected for a discount broker, as most will not offer advanced routing options.
Type of Trader Fidelity is Best For
While Fidelity has a diverse array of offerings, it is not the best broker for the active trader. There are better options in terms of executions with the same commissions. Furthermore, brokers like ETRADE and TD Ameritrade continue to lead the market with their advanced platforms. While some of the distinctions between discount brokers can come down to preference, we believe that Fidelity doesn’t provide much of a competitive edge when compared to its peers.
However, Fidelity is an excellent broker for the position or longer term investor. The vast amount of research offered is of huge benefit to an investor. While traders may not get the same benefit from this type of research, it can be very beneficial for investors.
Pros & Cons
Best research offering in the industry
Competitive commission rates
Excellent mobile app
Least amount of commission-free ETFs in industry
Advanced trading platform requires a minimum amount of trades
High minimum initial deposit ($2,500) relative to the industry
SureTrader is a brokerage based in The Bahamas, offering U.S. residents the opportunity to circumvent the SEC’s pattern day trader regulation. The brokerage is mostly targeted at day traders trying to circumvent their country’s regulations.
As a division of Swiss Americas Securities, Ltd., SureTrader is overseen by CEO Guy Gentile, who in 2016 was charged by the Securities and Exchange Commission with penny stock manipulation schemes. The charges were dismissed in 2017. Gentile also founded brokerage Speedtrader. SureTrader began operations in 2011 and quickly broke ground, averaging 30,000 transactions by May 2012.
Type of Broker
SureTrader is a unique broker solution. While it offers direct market access because of their day trader customer demographic, it is not marketed as such. It is marketed more as a solution for traders to evade their country’s trading regulations. This broker is best compared to TradeZero, another Bahamas-based broker that doesn’t adhere to the PDT rule.
SureTrader requires a minimum account deposit of $500, allowing you to day trade as soon as the transaction clears.
Commissions & Fees
SureTrader has a progressive, per-share trade rate, meaning that the more volume you produce, the cheaper your commissions become.
At the entry-level rate of 0-250,000 shares traded per month, you are charged $0.01 per share with a minimum ticket price of $4.95, and a maximum of $50.00. Below is a table outlining SureTrader’s progressive commission structure.
Volume Per Month
Per Share Rate
Per Trade Minimum
Per Trade Maximum
0 – 250,000
250,001 – 500,000
500,000 – 750,000
750,001 – 1,000,000
0 – 100
$4.95 + $0.50 per contract
$2.95 + $0.40 per contract
SureTrader charges hefty software and data fees, most of which are free to clients of the top brokerage firms like E*TRADE and TD Ameritrade. They have a few different trading platforms of varying cost. The costs are laid out in the table below
While SureTrader offers a lot of the features advanced traders need (as we’ll discuss later), the fees can add up quickly. Unlike many other discount brokers, you will be required to pay for data, platform access, and more. In this sense, SureTrader is for a very unique type of client – a day trader with advanced brokerage needs and minimal funds. No doubt, SureTrader has a competitive offering, but the main differentiator is still the ability to bypass the PDT rule.
Miscellaneous Account Fees
In addition to the various software and commission fees, SureTrader charges clients for account activities.
Outgoing Funds: $40.00
Inactive Fee (Quarterly – under 15 trades): $50.00
Margin or Equity Call Fee: $25.00 per day
SureTrader claims they offer “discount margin interest rates,” but do not disclose their rates. Instead, they encourage clients to contact them for their rates. Here is the information they lay out on their website:
“SureTrader offers discount margin interest rates, more competitive than other loan options. Clients with higher balances pay lower rates. While your portfolio’s value changes, the amount of your margin loan does not. Once you understand the rules and risks regarding margin trading, contact SureTrader regarding your discount margin interest rate offer.”
Platforms & Tools
SureTrader offers three unique trading platforms:
SureTrader Mobile App
ActiveWeb is SureTrader’s free web trading platform. It is similar to most basic web trading platforms offered by other brokerages. You can access most of the tools you need from an online trading platform, however more serious traders will prefer the Pro platform.
SureTrader Pro is SureTrader’s premium trading platform, costing $49 per month. It is the DAS Trader platform with SureTrader’s branding throughout (similar to SpeedTrader Pro). The platform is similar to most advanced day trading platforms offering hot keys, level 2 quotes, advanced charting, etc. SureTrader Pro is actually one of the nicer trading platforms available. They provide quality charts, level 2, and other beneficial features.
The following is a layout of its features:
Level 2 market depth
Hot key order execution
SureTrader offers free mobile web trading to all of their clients. This app is very basic but allows for trading on the go.
iDASTrader Mobile App
This is SureTrader’s more advanced mobile trading app, which costs $35 per month, or it comes free with a SureTrader Pro subscription. If has features like:
One of SureTrader’s main selling points is their increased leverage offering beyond standard United States brokerages. SureTrader offers 6-to-1 intraday leverage and 2-to-1 overnight leverage. This is in contrast to the standard leverage offered by a US broker like TD Ameritrade, which is 2-to-1 leverage.
SureTrader has a terrible customer service reputation. Personally, I’ve contacted their customer support on multiple occasions only to find myself waiting on hold for over 30 minutes. When I would finally get on the line with a customer service, the representative would have little to no knowledge on the topic I need help troubleshooting. My experience is not unique, either.
Borrows and Locates
One of SureTrader’s most widely praised features is their wider-than-average availability of stocks to borrow for short selling. While they won’t offer every hot penny stock, many day traders have a SureTrader account specifically to borrow the hot penny stock of the day when it is tanking.
It is simple to figure out if a stock is available to short inside of the SureTrader Pro platform. In the “Trade” window, you can simply click on “Short List” and type your ticker.
If you need to locate a stock to borrow, you can contact their live chat support but, this has varying rates of success.
Type of Trader SureTrader is Best For
SureTrader is best used by the United States (or abroad) trader who is burdened by regulations such as the Pattern Day Trader rule, which prohibits trading accounts with less than $25,000 from executing more than three day trades in a five day period. Additionally, it offers more leverage than its United States counterparts, so it works on multiple levels for under-capitalized US day traders.
While the ability to bypass the PDT rule can be enticing to newer traders, it’s important to remember that the PDT rule is there to protect you (whether you agree or not). Leveraging a small account and trading actively can be dangerous, and ultimately lead to account depletion. Traders with smaller accounts may consider commission-free brokerage, Robinhood, or other discount brokers like ETRADE, Scottrade, and TD Ameritrade.
Pros & Cons
Circumvent the pattern day trader rule as a small trader
Increased leverage (6:1)
Wider availability of borrows
Can attain direct market access
Per share fees add up when trading cheap stocks
Tendency to “nickel and dime,” they charge many fees that other brokers do not, such as fees for outgoing funds ($40.00).
Its main selling point is for undercapitalized traders trying to escape regulations yet, all of the high fees will eat up a small account balance.
Merrill Edge is a division of Bank of America Merrill Lynch, and was created after Bank of America acquired Merrill Lynch in 2008. Founded in 2010, Merrill Edge is a online brokerage platform targeted at investors with between $100,000 and $250,000 to invest. It was founded by combining Bank of America’s online investing services and Merrill Lynch’s investment services resources.
Merrill Edge has no minimum initial deposit to open an account.
Commissions & Fees
Stock and Options Trades
Type of trade
$6.95 + 0.75 per contract
Penny Stock Fees (stocks less than $1/share
Merrill Edge offers 30 commission free stock/ETF trades to all clients with a balance more than $25,000.
Merrill Edge’s premium software pack, MarketPro doesn’t have any direct price, but in order to qualify for the platform, you must make at least 15 times per quarter, or have a combined $50,000 in your Bank of America banking and Merrill Edge accounts.
$24,999 or less
$25,000.00 to $49,999.99
$50,000.00 to $99,999.99
$100,000.00 to $249,999.99
$250,000.00 to $499,999.99
$500,000.00 to $999,999.99
Miscellaneous Account Fees
Returned ACH debit fee
Full account transfer fee
Partial account transfer fee
$49.95 (retirement accounts)
$0 (non-retirement accounts)
Wire transfer fee
Security transfers and fees
Register & ship (non-government security
$25 (state of ownership
$500 (physical certificate)
Government security transfer fee
Fund transfer services returns
Bond coupon deposit fee
Past due exchanges for physical securities
Check writing & bill payment
Cancelled check fee
Returned check fee
Stop payment fee
Unlimited check writing
Web bill payment
Returned ACH debit fee
Statements & documents
Trade confirmation copy requests
Paper statement request
$5 per statement
Overnight mail request
Platforms & Tools
Merrill Edge offers two trading platforms: their basic “retail” web-based platform, and their more comprehensive, premium trading platform MarketPro. As mentioned above, one must make at least 15 trade per quarter or have a combined balance of at least $50,000 in your Bank of America banking and Merrill Edge accounts.
Merrill Edge Trading Platform (Web)
Merrill Edge’s basic platform offers all most would ask of a brokerage’s web platform. It has quotes, basic charting, an option chain, a new feeds, and even some decent research functionality. Merrill Edge uses Morningstar and Lipper as their main research providers, each offering their own unique visualizations and proprietary ranking systems.
Their web based technical charts are more than enough for basic technical analysis, offering the majority of popular technical indicators.
Merrill Edge MarketPro
MarketPro is Merrill Edge’s premium trading platform. It is their counter offer to the other premium software packages in the industry like ThinkOrSwim.
The charts inside MarketPro are pretty robust and stand up to many of the charting packages included with trading platforms. They offer around 70 technical indicators, various drawings like Fibonacci retracements and trend lines, as well as intraday tick charting.
A feature that I’m a fan of is their “Market Movers” scanner. While not anything new, many platforms simply don’t offer a customizable automatic scanner. It allows you to select from more than 90 scanning criteria and refreshes every 30 seconds.
Other features I like:
Level 2 market depth aesthetic
Simple BofA Global Research rundowns
Ability to position a bar at the top or bottom of your platform showing the quote of a specific ticker.
Merrill Edge Mobile
Merrill Edge’s mobile app is probably the weakest point of the brokerage. Not only does it look outdated, but recent updates have hurt functionality. Users of the app report slowness, and frequent errors when placing orders.
The charts are simple area charts with no extra functionality, reminding one of a brokerage app from 2010.
For example, iTunes user 321lorenzo says…
“Update Jan 2018 – this app is still shockingly terrible. How does the #1 bank on the world have the world’s worst iphone let app?”
Merrill Edge has a comprehensive research offering. They offer various types of research in different niches. A large reason Bank of America originally acquired Merrill Lynch was because of the gravity of their research, due to their status as an investment bank and wealth management firm.
Daily Market Summaries
Merrill Edge curates a daily market summary of news, market performance, and trends using Thomson Reuters data.
Merrill Edge clients get access to two premium stock screeners: Morningstar and CFRA.
Merrill Edge: Our Perspectives
This is more editorial content from Merrill Edge, it is their newsletter, various articles, and deep research pieces. An example of an Our Perspectives piece would be a long PDF on how a new Washington tax reform bill can affect markets and your personal finances.
BofA Merrill Lynch Global Research
This research division of Bank of America has won awards from Institutional Investor six years in a row for the best research offerings from 2011-2016. Clients of Global Research get access to a number of flagship reports, proprietary economic indicators, and access to corporate events. Among these are:
Global Fund Manager Survey (monthly)
The Thundering World (macro trade ideas)
U.S. Economic Weekly (weekly report on U.S. economy, leverages proprietary economic indicators
Merrill Edge has an international 24 hour customer service phone line, with an average wait time of four minutes. Of 234 customer votes, 92% rate their help as quality, according to GetHuman. In Benzinga’s 2017 review of Merrill Edge, their customer service was highly praised.
Type of Trader it is Best For
Merrill Edge is best for the mutual fund or stock investor, their huge library of research will aide in your investment choices, and their mutual fund prices are among the cheapest in the industry. However, unlike many large brokerages, they currently offer no commission free ETFs, making them a bad choice for ETF investors.
I believe shorter term traders would be better off at a broker like TD Ameritrade or Etrade, who offer very similar fees and commissions, but undeniably stronger platforms than Merrill Edge’s MarketPro.
Pros & Cons
Strong research library
30 free trade per month if you have more than $25,000 in your account
No commodities or Forex offerings
Premium trading platform is lacking for many short term traders
Just2Trade is a discounted brokerage firm founded in 2010, designed for the value-focused trader. At $2.50 per equity trade, they are undercutting all of their competition and positioning themselves as the value brokerage. What they lack in research and infrastructure, they make up for in low fees.
Type of Broker
Just2Trade is a super discount brokerage. Unlike, the traditional “discount” brokerage firms like TD Ameritrade and Scottrade, Just2Trade has very little infrastructure, opting for a more lean business to justify their low fees. They offer no advanced trading platforms, research, or on-demand customer service that a traditional discount brokerage firm would.
Just2Trade’s minimum initial deposit is somewhat for the industry at $2,500. Once an account is opened, clients must maintain a balance of at least $2,000 or else their capability to trade ceases until they deposit more money.
While the initial deposit requirement is not out of the ordinary, it is atypical for a broker to require an equity maintenance so close to the minimum initial deposit.
Commissions & Fees
Commission Prices (Equity)
Just2Trade has two different equity trade pricing models. One is a flat-rate per-trade model, and the other is a progressive per-share model.
Per-Trade Plan: $2.50 per trade
Minimum $0.50 per ticket
Volume (per month)
Commission Per Share
< 999,999 Shares
1,000,000 – 5,000,000 Shares
> 5,000,000 Shares
Commission Prices (Options)
Similar to their equities pricing model, Just2Trade has both a per-trade and a progressive per-contract model.
Per-Trade Plan: $2.50 + $0.50 per contract
Minimum $1.00 per ticket
Volume (per month)
Just2Trade Inc. Commission Per Contract
< 100,000 Contracts
100,001 – 200,000 Contracts
> 200,001 Contracts
Just2Trade offers a multitude of trading platforms. The advanced trader is likely to find a platform they feel at home using at Just2Trade. Not only do they offer their own proprietary platforms, but they have access to industry standard platforms like MetaTrader 5.
Just2Trade + is their free advanced web-based trading platform, available to all clients. It offers all the basic features one would expect from a web-based broker platform, and then some. In addition to the staple features like candlestick charting, watch lists, and an option chain, the platform also features level 2 and time & sales.
Just2Trade offers both iOS and Android versions of their mobile app. Both offer very basic functionality, but not any less than one would expect from a lower-end brokerage’s app. Actions like simple trade orders, simple charting and checking quotes are offered.
Other Trading Platforms Offered
In addition to Just2Trade’s platforms, they offer premium platforms, which they seemingly price in a discretionary matter. They have no pricing info on their website.
Just2Trade Pro: Their advanced desktop platform with market depth, real-time quotes, and historical data
MetaTrader 5: The most popular Forex trading platform in the world, Just2Trade allows you to trade stocks using MetaTrader
API access: Just2Trade offers programmers to access their API to write automated trading algorithms.
Third Party Platforms
Just2Trade allows subscribers of various popular third party trading platforms accessibility to their favorite platforms, a large selling feature for self-directed short term traders.
Sterling Trader Pro
$0.01 – $9,999
$10,000 – $24,999.99
$25,000 – $49,999.99
$50,000 – $99,999.99
$100,000 – $249,999.99
$250,000 – $499,999.99
$500,000 – $999,999.99
$1,000,000 or more
Because of their standing as a super discount broker, it would be unreasonable to expect Just2Trade’s research suite to stand up to a research-heavy broker like Fidelity. Additionally, this broker is more marketed to the self-directed trader who likely has their own research sources they pull from. With that being said, Just2Trade’s research offerings are very weak compared to the rest of the industry.
Just2Trades is a division of WhoTrades, which is a stock market social network similar to StockTwits
Similar to the research section, it would be somewhat unreasonable to expect top level customer service from a brokerage firm charing half the industry rate. That being said, their customer service reputation is less than stellar.
They offer toll-free phone service, email service, and a live chat bot. Many customers report rude and unhelpful customer service.
Executions & Routes
Just2Trade offers direct market access through third party DMA platforms like Sterling Trader Pro
Type of Trader it is Best For
Just2Trade is best for the self-directed short term trader for whom $4.99 commissions from a big-five broker is too expensive. It is best if you have your own research sources that you pull from, as Just2Trade’s offerings are almost nonexistent. Additionally, this trader should be good at troubleshooting platform issues, as the customer service is not as reliable as a larger broker either. If a trader can put up with these drawbacks, they enjoy reduced commission rates.
Pros & Cons
Among the cheapest commissions in the industry
Ability to reduce your commissions with trading volume
Ability to use your preferred third-party trading platform
Investors Business Daily is an online financial news and research publication offering a variety of market resources, educational tools, and platforms. The company was initially founded as a print publication in 1984 by renowned investor, William O’Neil. The publication stood the test of time and eventually made it’s way into the online world. Today, Investors Business Daily is one of the leading market authorities, trusted by millions of visitors around the globe.
Who is William O’Neil and Why Does it Matter?
William O’Neil is an investor, stockbroker, and respected author. Within the stock market community, he is most well-known for his book “How to Make Money in Stocks.” “How to Make Money in Stocks” explains O’Neil’s growth investing strategy in great detail. This strategy is based heavily on the “CAN SLIM” system, which outlines the seven characteristics of top-performing stocks. These characteristics include:
Current quarterly earnings
Annual Earnings Growth
New Products or Services
Supply and Demand
Leader or Laggard
So, why does this matter?
The “CAN SLIM” strategy serves is the methodology behind the premium tools offered by Investors Business Daily. Every savvy investor and trader should be focused on the “why” behind a trading strategy, as blindly following stock picks is a recipe for disaster. Having a basic understanding of IBD’s methodology can help you better understand their stock picks and platform features.
Leaderboard and MarketSmith
Leaderboard and MarketSmith are two of the flagship offerings of Investors Business Daily. These platforms were built with O’Neil’s methodology in mind, and serve as powerful platforms for investors aiming to outperform the market.
If you’re familiar with Day Trade Review, you know we generally focus on trading services over investing services. That said, Leaderboard and MarketSmith both incorporate elements of technical analysis, and we’ve found them to be useful for day trading, swing trading, and investing.
What’s the Difference Between Leaderboard and MarketSmith?
Both platforms are similar and built around the same growth investing strategies. The biggest difference comes down to the type of investor using the platform.
Leaderboard is designed for casual investors who are looking for stock recommendations backed by quality research.
MarketSmith is designed for active investors who prefer to do their own research.
Let’s dive deeper into the features of both platforms so you can decide which one is the better fit for you.
Leaderboard is essentially a stock research service backed by the time-tested strategies of IBD. The IBD team researches the best growth stocks and shares the reports with Leaderboard subscribers. IBD claims that Leaderboard outperformed the S&P 500 by 18% in 2017 (an impressive feat).
Leaderboard can be accessed for either $69/month or $699/year, with the option to start with a 14-day free trial.
At this price point, Leaderboard is ideal for investors of all levels. We recommend starting with the trial, moving onto the monthly subscription, and then switching to an annual plan if you decide you like the platform.
The Platform: Leaderboard
Upon logging into the platform, you will see a quick update on stocks from the “Leaders” list, “Leaders Near a Buy Point” and a “Leaders” list.
“Leaders Near a Buy Point” are stocks within 5% of the recommended buy price whereas “Leaders” are past picks that are performing well. “Leaders” may eventually make their way onto the “Leaders Near a Buy Point” list in the case of a pullback (or updated research).
Each section shows the company, the current stock price, and the research provided by the IBD team. The dashboard is well-organized and offers a great snapshot for investors who don’t want to spend hours researching and reading reports. IBD’s team does a great job of researching companies and summarizing the information in a simple format.
The dashboard also focuses on quality over quantity. IBD isn’t making recommendations for the sake of it and, if there are only a few good buying opportunities, the dashboard will reflect that.
When scrolling through the Leaderboard, you can choose to add a stock to your watch list, analyze the chart, read recent articles, or set an alert.
The charts are one of the best features of the Leaderboard platform (second to the stock picks themselves). They help traders/investors get a better understanding of the history of the company and its current standing.
The charts are beautifully annotated and provide trading rationale for IBD’s bullish thesis.
IBD defines the ideal buy zones on the chart, making it easy for casual investors to plan entries.
To the side of the chart, you can get a quick snapshot of a company’s fundamental performance, technical performance, and market benchmarks.
The Big Picture
The Big Picture section provides a daily market update. It’s easy to read and packed with valuable information.
While you can choose to view “Intraday Updates,” we found that the real value is in the “Daily Big Picture.” Having all of the information in one place saves you time you may have otherwise spent jumping between CNBC and Wall Street Journal articles.
IBD Sector Leaders
The sector leaders section provides updates on some of the top stocks in each section. It is frequently updated and follows the same format as the stocks listed on the dashboard.
This is a great idea generation tool for investors looking to diversify and/or build positions in specific sectors.
For those looking to dig even deeper, the “IBD 50” pages shows a list of IBD’s top stocks. You can choose to view the top 10 or view the full list of 50.
This tool is helpful for traders and investors looking for even more investing opportunities. The stocks listed may not be in “buy zones” yet but may present opportunities in upcoming trading sessions.
In this sense, the platform is well-organized and caters to the needs of different type of investors. Based on your level of involvement, you can choose to view the Leaderboard (lowest involvement), Sector Leaders, or IBD 50 (highest involvement).
Final Thoughts on Leaderboard
Leaderboard is a valuable tool for investors looking to expand their portfolios by identifying potential outperformers.
IBD does a good job of researching stocks and keeping investors updated.
While traders may get some use out of Leaderboard, the platform is mostly geared toward growth investors due to its simplicity and longer term horizons.
MarketSmith is a bit more versatile and takes Leaderboard to the next level.
MarketSmith is a research platform designed for more sophisticated investors. This platform can be thought of as the “self-serve” version of Leaderboard. Whereas, Leaderboard provides investors with research and stock recommendations, MarketSmith enables investors to do the research on their own. There are a few benefits to this approach:
You can find more trading opportunities
You can custom tailor the platform to your own trading style
For example, if you’re primarily focused on trading small cap stocks under $20/share, you can use those criteria to filter your results in MarketSmith. Essentially, MarketSmith is a more flexible platform that allows you to implement your own strategy whilst still benefiting from the research provided by Investors Business Daily.
MarketSmith can be accessed for either $149.95/month or $1,499/year. You can also choose to take a 3-week trial for $19.95.
While the MarketSmith platform is more than double the cost of Leaderboard, the pricing is justified by the offerings. It could be argued that you get way more than double the power of a Leaderboard subscription and we definitely preferred the MarketSmith platform.
The MarketSmith platform is loaded with powerful tools and features. It would be impossible to cover each feature in-depth but we’ll do our best to highlight our favorites.
Education and Webinars
Upon logging in to the MarketSmith platform, you will be greeted with a few options. The first one that stands out is the education section (most noticeably, the webinars).
The webinars section provides details for upcoming webinars as well as an archive of previous webinars. While not the key offering of the service, this provides a lot of value in an industry where education can affect your bottom line.
A quick glance at the archive shows topics spanning portfolio management, trading psychology, and technical analysis.
The MarketSmith charts are clean and packed with valuable information.
This is not your typical charting platform. Whereas platforms like TradingView and eSignal provide great charts, the true value of MarketSmith charts lies in the information and research provided. The charts are covered with a combination of fundamental and technical data to help aid the research process.
MarketSmith uses bar charts with the following overlays:
RS (Relative Strength)
50 and 200 Day Moving Averages
An S&P 500 Line (for Benchmarking)
Average Volume Line
You can choose to add/remove some of the overlays via the chart menu.
Chart timeframes can be set to intraday (minutes), daily, weekly, and monthly, depending on your trading style.
The charts are also annotated with chart patterns (based on timeframe), such as:
Cup and Handle
Cup (Rounding Bottom)
The charts do a great job of fusing technical and fundamental data. You can track a company’s EPS growth, S&P benchmark performance, and other key information without leaving the chart screen.
The charts are also helpful for decision support. If there is a trading opportunity for a given stock, the chart will highlight the ideal buy zone (blue), profit taking zone (green), and stop loss zone (red). This provides visual support during the trade planning process.
Here are a few other features:
Custom chart annotations – Add your own annotations and/or technical drawings (i.e. trend lines)
Saved layouts – The platform automatically loads your chart settings from last login
“Play” Feature – The play feature rotates through a list of charts automatically for quick analysis and updates
In the future, it would be nice to see the addition of candlestick charts as well as better zoom functionality.
Fundamental Data & Related Information
Fundamental data is laid out in the top corner of the chart.
The platform offers a few common fundamental data points as well as a few of IBD’s proprietary metrics (i.e. EPS Rating). Here is the full list of fundamental data:
Group RS Rating
If you want even more information on a company, you can click on the “Related Information” tab on the right.
This tab will give you information on:
Fund Ownership History
Industry and Sector Benchmarks
The one feature that is particularly unique is the “Checklist” feature. This list tells you if the stock meets the criteria of successful investors like William O’Neil, Warren Buffet, Benjamin Graham, Peter Lynch, and more. Checklist criteria may include EPS ratings, stock price, stock volume, return on equity and more.
As mentioned above, one of the main benefits of MarketSmith over Leaderboard is that it allows you to cast a wider net. The platform incorporates more scanning tools and discovery features. One of those features is called “Stock Ideas”
Stock Ideas provides pre-built scans of stocks based on a variety of criteria. Here are a few examples:
Breaking Out Today
Earnings – Gap Up
Top Rated IPO’s
Up on Volume
Once you choose a stock idea, the scan returns results. You can filter through the results manually or use the “Play” feature to rotate charts automatically.
The “Stock Ideas” feature is particularly useful for day traders and swing traders because it accounts for recent data (such as stocks gapping up or down). This can be helpful for building watch lists and planning trades.
MarketSmith screeners are a gem within the platform. You can choose between pre-built scans and custom scans.
What separates MarketSmith from other scanning platforms like FinViz is a) the research that goes into planning these screeners and b) the incorporation of fundamental data. Most of the scanning platforms we’ve reviewed have been heavily biased towards technical analysis whereas MarketSmith screeners lean more towards fundamental analysis.
The custom screens can help you build screens that match your personal trading style. You can choose between over 130 technical and fundamental indicators, such as:
Price and Volume
For example, you could scan for the best Internet-Retail stocks based on EPS and RS ratings. Similarly, you could scan for the best low-priced stocks by settings price filters.
It takes some time to find the settings that match your style but the time invested is well worth it.
If you’re scanning for a lot of stocks and jumping from idea to idea, it can be easy to lost track of some stocks. To combat this, MarketSmith allows you to set price alerts with optional email notifications and alert notes.
There is an alerts section on the top of the chart that shows today’s alerts as well as other recent alerts.
While this is a nice feature, it would have been helpful if they offered different types of alerts (such as moving average..
Charles Schwab is a United States discount brokerage in operations for over 40 years. While it’s brokerage operations started in 1975, it’s history goes back to 1963 when founder Charles R. Schwab launched investment newsletter Investment Indicator.
Charles Schwab is a discount brokerage firm, with no true direct market access. It does, however, offer limited direct order routing with a very limited choice of ECNs. As you can see in their direct access documentation, the only routes offered are:
SmartEx (Schwab owned)
The minimum deposit for a regular Schwab brokerage account is $1,000.
Commissions & Fees
Schwab ETF OneSource (commission free ETFs from 16 providers)
All other ETFs
$4.95 + $0.65 per contract
$3.50 per contract
Futures Options Trades
$3.50 per contract
All of Schwab’s trading software options are free to all clients enrolled in the no-charge Schwab Trading Services program. The platforms include:
Schwab.com Web Trading
Charles Schwab Mobile
Fees to Transfer
Online between Schwab accounts
Online between outside accounts and Schwab investment accounts via Schwab MoneyLink
Schwab Mobile Deposit
Wire (from Schwab account)
Wire (into your Schwab account)
Depends on sending institution
Automatic Investment Plan
Schwab Bank Bill Pay
Automated Investing & Financial Advice
Schwab Intelligent Portfolios
No advisory fees
No account service fees
Schwab Intelligent Advisory
0.28% of assets under management
Schwab Private Client
Starts at 0.90% for equities
Starts at 0.75% for fixed income
Schwab Advisor Network
No charge for referrals
Platforms & Tools
Schwab offers three unique trading platforms, all with their own benefits and drawbacks. All three are free to all Schwab clients.
Schwab’s Trading Tools and Platforms - YouTube
StreetSmart Edge is Schwab’s premier trading platform, it essentially their ThinkOrSwim competitor, an all-encompassing trading platform with a suite of advanced features for active traders, all while keeping a free price-tag.
Recently desktop only, Schwab recently added a cloud-based web version of StreetSmart Edge.
Stock and ETF Screeners
Search for stocks using descriptive measures like Volume, Price Change, Sector, Momentum, etc.
24 hour, ad-free broadcast of CNBC
Real-time News Feed
Aggregated feed of stock market related news
Real-time charting with multiple chart types available. From candlesticks to line charts, from monthly to tick charts, the charting package is robust enough for most traders
A condensed view of a company’s fundamentals including earnings, analyst ratings, short interest, list of executives, etc.
Manage risk using StreetSmart Edge’s alert system, setting alerts for specific prices, or other technical signals.
Drag and drop layouts to different monitors while using a multi-monitor setup, or just set up your platform in the fashion you prefer.
Schwab Web Trader
Schwab has two web trading options: their run-of-the-mill web trading platform, and their cloud based version of StreetSmart Edge. Your average investor is unlikely to need more than the regular web trader, however, the active trader benefits greatly from StreetSmart Edge.
You can watch a video rundown of Schwab’s Web Trader here.
Schwab’s mobile app, while practical, is pretty unremarkable. Its features are almost identical to the mobile apps of the rest of the “big five” brokerage firms, with TD Ameritrade’s ThinkOrSwim app far surpassing Schwab Mobile, feature wise.
The one standout feature of Schwab Mobile is their Deposit Check feature, allowing you to immediately scan a check and deposit into your brokerage account. This is a handy feature, offered by a few other brokers, like ETRADE.
Base Rate = 7.00%
$ 0- $24,499.99
Base Rate + 1.825%
$25,000 – $49,999.99
Base Rate + 1.325%
$50,000 – $99,999.99
Base Rate + 0.375%
$100,000 – $249,999.99
Base Rate + 0.325%
$250,000 – $499,999.99
Base Rate + 0.075%
Schwab offers a wealth of third-party research tools and sources, more than enough for even the most astute of traders/investors.
In addition to Schwab’s Proprietary Research, they supply multiple third-party research sources including:
While Charles Schwab has phone and live chat support, their customer service record is pretty bad.
In the last year, 38 ratings have been submitted to Consumer Affairs with an average rating of 1.2 stars out of 5.
What Type of Trader is Schwab Best For?
Schwab is ideal for the trader who also invests long term, and requires a wealth of research to aide said investing. With their robust trading platform StreetSmart Edge, their huge library of research, and competitive industry rates, it is hard to go wrong with Schwab unless you have very specific trading needs like direct market access.
Pros & Cons
Huge library of research
Advanced trading platform
Limited direct market access (better than many brokers that have none at all)
Diverse selection of trading opportunities. All types of securities are offered, as well as international securities
Piece of mind of a top five brokerage firm
Customer service has a bad reputation for not solving issues
The hyperactive trader might want more functionality out of their trading platform, and may opt for TD Ameritrade’s ThinkOrSwim
StockTwits was launched in 2008 by Howard Lindzon as a platform for traders and investors to share ideas. The platform is responsible for popularizing the cashtag (i.e. $AAPL) that we all know and love today. The site is home to over one million members who share trading and investing ideas in real-time.
The StockTwits platform will feel familiar right away. You can think of this platform as a fusion between stock market message boards and Twitter. Traders can share charts, links, and short messages about different stocks. These ideas are then aggregated into streams for each individual stock.
The most innovative part of the StockTwits platform is the cashtag, allowing users to tag tickers in real-time. Unlike clunky message boards, the system was simple and well-organized. Eventually, Twitter adapted the cashtag in 2012 making it easier for traders to use Twitter to share trading ideas. So, is the StockTwits platform outdated?
Yes and no. While you can use the basic cashtag functionality in Twitter, StockTwits is much more organized and “trader friendly.” Let’s dive into some of the features.
StockTwits provides streams of real-time messages that can be organized by a specific ticker or a general theme. For example, streams can be organized by:
Themed streams (such as trending) can be helpful for idea generation and the streams can be viewed in browser or popped out as their own windows.
The streams of specific stocks also provide some valuable aggregate data in the sidebar. Traders can track message volume and market sentiment over time.
The stream itself is pretty simple. You can share ideas and sort through messages. This whole section feels a lot like Twitter, where you can sort messages by popularity or recency and isolate media posts. Overall, it’s simple and easy to use
The quality of the streams comes down to the actual messages posted (which we will get to later).
StockTwits does a great job of aggregating data and creating visual representations through heat maps.
The heat maps can be used to explore popular sectors and find the most active stocks within those sectors.
StockTwits also has a section for top stocks. This can be considered the “trending” section as it shows stocks with increased (or decreased) levels of social activity.
Value of Aggregate Social Data
The heat maps section is the most valuable part of the website. This is the area where StockTwits truly differs from Twitter. Twitter simply allows traders to share messages and organize them by cashtag. StockTwits aggregates the data, making it far more valuable.
In this sense, StockTwits acts like a “social scanner,” helping you find stocks based on social activity. In fact I use the “StockTwits Social Media Mentions” filter as one of the hits for my scans in ETRADE Pro. Seeing all of this social data in one place can help you generate better trade ideas.
The Social Component
Now that we’ve discussed some of the core features of the StockTwits platform, let’s discuss it’s viability as a trading tool.
At its core, StockTwits is a social network designed specifically for traders. Traders can follow each other, share/like/repost messages, and more. Unlike Twitter, this community is designed specifically for traders and it shows. Traders can add watch lists, tag their messages as bullish or bearish, and utilize a variety of convenient features.
That said, StockTwits is a free community where traders can post whatever they want. For that reason, you run into three main issues:
StockTwits is a large community of traders and investors, making it a goldmine for marketers looking to reach a niche audience. I have absolutely no issue with the in-stream ads; I know StockTwits needs to make money somehow.
That said, there are many news sites and trading services that tag tickers and simply link to their own site in hopes of gaining exposure. This kind of promotion adds very little value and muddies up the streams. Just look at how many posts a single company in the niche has posted since joining in April of 2016:
While it’s impossible to avoid this issue completely, it would be nice to see StockTwits crack down on it a bit more.
The second major issue with StockTwits is the inability to determine the credibility of the users. In the world of finance, credibility is everything. For example, a stock tip from Warrenn Buffett is far more valuable than a stock tip from the clerk at the gas station.
The only metric that can be used to gauge the credibility of users in StockTwits is the follower count, which is definitely not the strongest indicator. For the most part, assessing credibility on StockTwits is the same as assessing credibility on Twitter. StockTwits does have a list of official accounts, but many of these are brands, and most messages in the ticker streams do not come from these accounts (from my experience).
It’s difficult to offer a solution to this problem, but I do like how TradingView assigns a reputation score to its users.
TradingView Reputation Score
If you’ve been trading for some time, you’ve probably been on at least one message board. The Yahoo Finance boards were popular back in the day and InvestorsHub remains popular for penny stock traders. The concept of financial message boards sounds great in theory but rarely works in practice. Simply put, there’s very little room for constructive conversations. Instead, these boards are littered with pumpers and bashers.
StockTwits faces the same problem. Messages like the ones below (which are common on most streams) hold little value.
The streams are far too noisy to be as valuable as they could be for active traders or those looking to do research.
Once again, it is hard to combat this issue on social networks, but the ability to filter messages based on the credibility of a user would be nice.
Is StockTwits Worth the Time?
Overall, StockTwits is still a quality website. The reason for mentioning the critiques is because I think the site could be 10x more valuable with some tweaks. Currently, I would define StockTwits as more of a social network than a trading tool. If you’re looking for actionable trading information without the noise, you should consider joining a trading chat room.
That said, StockTwits delivers a lot of value by aggregating message data into actionable insights. For example, reading 50 bullish ideas on a single ticker doesn’t add much value but knowing that 95% of the messages about that ticker are bullish can be an actionable insight.
Overall, I like StockTwits for two main reasons:
Entertainment and Basic Research
As mentioned above, the aggregate data is great for idea generation.
The site can also be used as an entertaining financial social network. It can be interesting to scroll through streams and see the different ideas surrounding a stock. There is also some valuable information embedded in the streams, but there is far too much noise to make this a “go-to” research tool.
Heat maps and aggregate social data are great for idea generation
Market Sentiment feature is insightful
Platform is well-organized and easy to use
Streams can be noisey
There is no credibility metric for users
If you already use Twitter for trading, StockTwits won’t deliver too much additional value
Benzinga Pro is the real-time news streamer launched by the team at Benzinga. Benzinga is a well-known market news source that was originally founded in 2010 by Jason Raznick. While the main Benzinga site operates as a news source (like CNBC or MarketWatch), Benzinga Pro operates as a news platform designed for fast-paces traders who need access to the right information at the right times.
Benzinga Pro is a web-based platform that will work on both Windows and Mac computers. The interface is simple, efficient, and easy-to-use. Don’t let the fact that it’s web-based deter you because the platform is feature-packed. This is actually one of the most efficient web platforms I’ve used in awhile. Unlike some platforms that were designed for desktop use and migrated to the cloud, Benzinga Pro was designed specifically for web-use and it shows. The platform is fast and well organized.
Benzinga Pro allows traders to create multiple workspaces. Think of these as tabs within the browser tab. You can use these different workspaces to organize the different modules. For example, you may have a news stream work space, a screener work space, and a watch list workspace. The workspaces make it very easy to keep your workspace (pun intended) organized.
Each workspace can be organized even further by splitting content into different screen areas (i.e. halves or quarters). You can have up to four screens in each work space, which can be helpful for traders with less screen real estate. Even if you have multiple monitors, it’s definitely more efficient to split the screens.
One thing I really like about the platform is the ability to open modules as their own windows. When you open a new module, you can choose to open it within the workspace or as a new window. Once again, this is great for conserving screen real estate.
For example, I have my workspace that I use as more of a research tool for charts, fundamentals, and specific news. I also have the streaming news setup as its own window. The streaming news is always present on my screen (as its own window) whereas the workspace is open in a tab that I rotate in and out of.
Themes & Settings
The default theme for the platform is dark, but you can choose between Dark, Light, High Contrast, and Antique. Personally, I think that the “Dark” theme is easiest on the eyes but some traders may prefer a lighter theme.
You can also change the text size and headline height for further customization.
The main feature of Benzinga Pro is its ability to deliver real-time streaming news. That said, the tool is more than just a simple newswire and goes as far as offering trade alerts and audio alerts.
The news streamer is the gem of this platform and Benzinga Pro is one of the better news streaming tools for the price. That said, it’s really important that you get your settings right.
The key with market news is actionability. You want to be able to find tradable news with ease. If you use the “straight out of the box” settings, you will be overloaded with information. There are tons of different news alerts and many won’t be relevant to your trading style. Of course, you can change the settings to filter the results. You can choose from sources, categories, and sectors. You can also choose to create newsfeed for your own watch lists, which can be particularly beneficial if you build your watch lists strategically (i.e. separated by sector, price range, time frame, etc.). Here are the available filters:
Market Moving Exclusives
IPOs & Offerings
Sectors (Each of which can be filtered into sectors within sectors)
To make this platform as resourceful as possible, choose a blend of filters that meets your trading style (i.e. Analyst Ratings in the Tech Sector).
The newsfeed streams in real-time and color codes tickers and prices based on the day’s price action (red = down. green = up).
Additionally, you can set a variety of notifications and alerts, including audio, desktop and email.
The Benzinga Pro newsfeed offers more than just news. You will also have access to other actionable information such as block trades, options alerts, stocks moving on volume and more.
Of course, you can disable these if you want a pure news platform but I found them to be beneficial.
Most traders are focusing on ten things at once. It’s easy to neglect a certain window and miss out on an important move. To combat this, Benzinga Pro offers a feature called “Squawk” which is essentially an audio newsfeed.
The audio newsfeed provides audio news updates in intervals. It’s not a non-stop stream and it definitely values quality of alerts over quantity. Think of this stream as CNBC minus all of the fluff. I actually really like this tool because it adds a new element to trading.
At any given moment I have multiple trading platforms running and a minimum of 10 tabs open in my browser. Audio alerts help me absorb more information without having to open another window.
While the main feature of Benzinga Pro is definitely the newsfeed, the platform also doubles as a research tool. There are a few main ways I use Benzinga Pro for research.
First, you can use the news search function to find relevant news. You’ll have to play around with a variety of searches to find the information you need but it’s very helpful once you figure it out (i.e. “acquire” delivered better results than “acquisition.”)
Second, I use the platform to get a quick “snapshot” of a stock. You can flip through company statistics, charts, financials, and more. Basically, it serves as a more refined Yahoo Finance, in this regard.
Lastly, I use the platform to stay on top of earnings reports. Benzinga Pro offers a nice earnings calendar that is easy to analyze and sort.
The Benzinga Pro platform has a built in stock screener that allows traders to find gainers and losers for intraday or daily time period. You can filter between gainers and losers and over the past 15 minutes, 30 minutes, or day. These results can be filtered even further based on stock price, market cap, and sector.
The screener updates every minute and results can be filtered by metrics such as percent change, volume, and more.
The screener is a nice tool to have in one of your workspaces if you want to get a broader view of the market. You can see where the action is and find the most volatile and liquid stocks. That said, the tool doesn’t really compare to scanners like Trade Ideas and EquityFeed. It’s more of a market snapshot than a scanner (and results are not delivered in real-time)
Benzinga Pro offers straightforward pricing plans. You can choose the “Basic” plan for $99/month or the “Essential” plan for $249/month. You can save 20% on both plans by choosing an annual subscription.
If this is your first time signing up for a news streaming service, I recommend starting with the “Basic” plan. While you will be limited in certain regards (i.e. no audio alerts), you will save $150/month and still have access to a lot of great tools. This will also give you some time to test out the platform and form an opinion.
More advanced traders who have used streaming news in the past and focus heavily on news and fundamental catalysts will probably prefer the “Essential” plan. I currently use the “Essential” plan and enjoy the additional features.
What Type of Trader is it Best For?
The Benzinga Pro platform is ideal for intermediate-advanced traders. Beginner traders will not be able to digest the sheer volume of information provided by the Pro platform.
The platform best for day traders who require the “real-time” component of this tool and incorporate news into their trading strategy. The platform has minimal value for traders who purely trade off technicals.
Customizable newsfeed with great sources and filters
Browser-based platform works on any device and operating system
Audio alerts are beneficial
Simple Earnings Calendar
Desktop and Audio Notifications
The price difference between the Basic and Essential plan is steep, especially for traders who only want a few of the Essential Features
Maximizing the value of the platform requires customization
One of the best ways to improve as a trader is to learn from other traders who have done it before. Learning from the experience of others can save you a lot of time and money. This is the reason many people hire consultants in their lines of work. Experience teaches lessons that other education cannot. One of the most effective ways to learn from other traders is by seeing their trading process live.
Day trading chat rooms are online chat rooms where traders discuss their trading activity. Some chat rooms are text only while others include audio and video components. There are plenty of trading chat rooms to choose one and, while some are better than others, there is no “one-size-fits-all” option. The quality of a chat room is dictated by both the chat room itself and your own personal needs. If you’re a swing trader in a day trading chat room, you won’t have much luck (and vice versa). So, what exactly should you look for?
Best Day Trading Chat Rooms
While there is no universal option, there are a few things you should consider before joining a chat room.
First things first, you need to find a trading chat room that is a good match for your trading style. Some good things to consider are:
Your Trading Style (if already defined)
Your Account Size
Your Core Competencies (i.e. technical vs. fundamental analysis)
It’s important that you understand how traders in the chat room approach the market. Are they looking to scalp a few cents at a time? Do they hold positions for minutes/hours/days?
For example, if you have $2,000 in your account and traders are scalping $0.10 moves, you probably won’t have much luck. Similarly, if you join a momentum trading chat room but work a full-time job during market hours, you may struggle to find success.
Think about your own constraints and find a chat room that matches.
Here are some characteristics of the top trading rooms we reviewed:
A chat room is only as good as the traders running it. Furthermore, the head traders in the chat room need to be able to provide actionable information. Trading a $0.20 scalp may not help other traders whereas trading a $2-3 move may.
Here are some things to be aware of:
Number of Head Traders/Moderators – If a chat room has a single head trader, you are relying on a single trader to get you the information you need to make trading decisions. While this may keep things simple, it can also be limiting.
Small Chat Rooms – There can be power in numbers. Theoretically, more traders in a chat room means more potential opportunities. If you create your own chat room with your trading group, that’s one thing, but if you are paying for a service, you may want access to a bigger community.
New Chat Rooms – It’s relatively easy to launch an online chat service nowadays. Beware of traders who’ve had a bit of success and launch their own service immediately. You want to trade alongside traders who have stood the test of time. Many chat rooms have come and gone over the years.
There are two basic styles of trading alerts:
An example of a trade alert would be “Buy 100 shares of stock $XYZ at $50.40.”
Trade Alert Example
An example of an information alert would be, “Citron hit piece out on stock $XYZ.”
Information Alert Example
Both alert styles have their pros and cons. A trade alert is simple and easy to understand but can encourage traders to copy the trade. In reality, it’s impossible to replicate someone else’s trades because you won’t get the same executions nor will you have the agility to pivot when necessary. That said, you can learn a lot from these alerts by looking at why the trader initiated the trade.
Information alerts allow you to put together your own plan. For example, you get an alert that a company announced a deal with Amazon and decide to buy into the initial momentum for a quick scalp trade. Another trader may see the same alert and decide to short the backside of the move if the price action is irrational. Information alerts also help you stay on top of different trade ideas. You can only watch so many stocks so it can be helpful to have other traders alert different ideas.
Beginners tend to favor trade alerts whereas more experienced traders tend to favor information alerts.
Chat Room Noise
A chat room should be considered a trading tool and, like any tool, you want it to run efficiently. Chat rooms are not supposed to double as tools like Twitter or StockTwits. Think of chat rooms like stock market scanners. Scanners (when set up properly) only deliver actionable alerts, meaning you don’t need to wade your way through useless messages to get the information you need.
It is recommended that you find a chat room with minimal off-topic chatter (noise).
Many chat rooms are littered with messages consisting of beginner questions, random conversations, and other irrelevant messages. While it may be nice to have your questions answered during the trading day, think about what happens when every trader in the room starts asking questions.
If you are a newer trader who has questions during the day, reach out to the chat room service and ask about the best way to get the support you need. Some services will offer “off-topic” chat rooms or provide support via private messages.
Chat Room Cost
Cost is a big factor when choosing a day trading chat room. There are two things you need to consider:
Chat Room Value
First, you need to decide how much you are willing to spend. If you have $3,000 in your trading account, it may not make sense to pay $2,000 for yearly access to a specific chat room. There are plenty of different rooms in different price ranges.
The second thing you need to consider is chat room value. Like most products and services, there are a variety of pricing options. That said, not all of the options are created equal. A $500 computer may not have the same computing power as the $2,000 option. Similarly, a $25 chat room may not have the same value as a $200 chat room.
This isn’t to say price is correlated with value, but you shouldn’t allow price to be the main factor. Look for the best value vs. the best price. If you’re looking to save more money, many chat rooms offer discounts on quarterly and annual options, but make sure you know what you’re getting into before committing to the longer timeframe.
Chat Room Technology
The last consideration is chat room technology. While this may not seem like a big deal initially, it can have an impact on the value you get out of the room. If a chat room is slow and buggy, it will be hard to use. If a chat room doesn’t have a mobile option and you trade from your phone (not recommended), you will have issues as well.
Some chat rooms will also have advanced features built-in, such as ticker tagging, stock charts, outside news alerts, video streaming, etc.
To see our full list of chat room reviews, go here.
Choosing the right stock broker is one of the first things you need to do when you start trading. New traders are always looking for broker recommendations, as if there is a “holy grail” of brokers kept secret by elite traders. Before we dive into our considerations and recommendations, it’s important to remember that, in most cases, your broker won’t make or break your success. Your broker is just one tool in your trading toolkit and, assuming you choose a reputable broker, you should have access to all of the tools and resources you need. While there are differences between brokers, the choice between ETRADE, TD Ameritrade, or other brokers will be one of the easier ones you make in your trading career.
Choosing a Penny Stock Broker
While all brokers serve the same general function, little differences can make an impact on your trading. Choosing the best penny stock broker is slightly different than choosing a broker for investing or momentum trading. Let’s discuss some of the considerations.
Stock brokers generally offer two commissions structures: per-share and per-trade. With the “per-share” commission structure, traders pay a commission based on how many shares they trade. For example, a 100 share order may incur a $0.50 commission at a rate of $0.005/share. With a “per-trade” commission, traders pay a flat-rate, regardless of the volume traded. For example, a trader may incur a $6.95 commission regardless of whether they trade 100, 1000, or 10,000 shares.
While per-share pricing may work well for momentum traders who scale in and out of positions, it’s not a feasible option for penny stock traders, especially those who trade sub-penny stocks where the share price may be equivalent to the per-share commission itself. Per-trade commissions are essential for penny stock traders.
Penny stock traders, like all traders, need access to solid trading platforms. It’s important to have access to quality stock charts, news, watch lists, etc. If you have specific needs (such as scanning tools or complex order types), make sure to review the trading platform before opening a trading account.
Level 2 Trading
Level 2 screens are a big part of many traders’ strategies, however they are exceptionally important for penny stock traders. Level 2 screens allow traders to analyze supply and demand in the market. Penny stocks are generally have lower liquidity and higher volatility when compared to blue chips and NASDAQs. Level 2 screens can help penny stock traders better understand price action, allowing for improved entries and exits.
No Additional Fees
Most modern-day penny stock brokers will offer many of the tools traders need, however not all brokers will offer these tools for free. Certain brokers charge additional fees for trading platforms and level 2 access. While this may not be a big deal to traders with bigger accounts, most penny stock traders are focused on making the most of their capital. If you have a smaller account, the last thing you want to do is incur additional fees (especially when you don’t need to). Before choosing a broker, make sure you are clear on any additional fees you may incur.
Penny stock traders often come to the market with smaller accounts. After all, the appeal of penny stocks is that they can be purchased for such a cheap price. Many stock brokers will have an account minimum, requiring traders to deposit a certain amount of funds before trading (i.e. $2000). Before choosing a broker, make sure they don’t have an account minimum.
It should also be noted that account minimums can be practical in certain cases. Trading with a $500 account can be difficult considering most commissions will eat 1% or more of your capital for every trade. Of course, you can trade with a smaller account but make sure you know what you’re getting into.
Penny Stock Broker Recommendations
Now that you know what to look for in a penny stock broker, let’s discuss some recommendations.
Based on our reviews, ETRADE is the clear winner for best penny stock broker. ETRADE is a leading discount broker with advanced technology and powerful tools. Here are a few reasons why we like ETRADE:
Commissions start at $6.95 and go as low as $4.95 for active traders
Multiple trading softwares offered for free
ETRADE Pro is a powerful platform offered for free for active traders
Powerful mobile app with Level 2 trading and intraday charts
Online tools make it easy to fund accounts and manage portfolios
Customer services is unbeatable, with a knowledgeable staff and 24/7 support
No additional fees required to get access to trading platforms and level 2
$500 account minimum
Great new account bonuses (including free trade offers)
TD Ameritrade is our second choice for best penny stock broker. TD Ameritrade is very similar to ETRADE and the choice between the two may come down to preference. Here are a few reasons why we like TD Ameritrade:
$6.95 trade commissions
Powerful ThinkOrSwim trading platform offered for free
ThinkOrSwim allows paper trading (for newer traders)
Powerful mobile app with level 2 trading and intraday charts
Easy-to-use online dashboard for account management and funding
No additional fees required to get access to trading platforms and level 2
No account minimum
Great new account bonuses (including free trade offers)
Scottrade is our runner-up choice for penny stock brokers. If for some reason you are unable to use ETRADE or TD Ameritrade (or maybe you want to open multiple accounts), Scottrade is a viable option. Here’s what we like about Scottrade: