Active investors are like quarterbacks. After huddling with
the latest market data, they set out to execute their plays, but
they must react quickly whenever reality blitzes them like
To improve their success rate and avoid sacks, they need their
stockbrokers to give them accurate, fast service.
Best Online Brokers special report
, investors can get the scouting data they need to find the
brokers who will do the best job for them. To create the
rankings, IBD conducted a major survey of investors and
identified the best online brokers overall -- and the top
performers in 12 critical categories.
The categories cover the broker characteristics that survey
respondents rated as most important: Low Commissions & Fees,
Options Trading Platform, Research Tools, ETF Choices, Portfolio
Analysis & Reports, Investment Research, Educational
Resources, Tax Preparation Tools, Trade Reliability, Equity
Trading Tools, Customer Service and Mobile Platform/Trading. (For
more on the survey methodology,
Think about what's No. 1 to you as a brokerage customer trying
invest successfully in the stock market
. Make sure that key attribute is reflected in your broker's
strengths, just like an option QB demands that his running back
can handle a quick pitch.
So who are the top five brokers overall? USAA,Charles Schwab (
), Thinkorswim (one ofTD Ameritrade 's (
) platforms), Fidelity and TradeStation.
The rankings for Overall Customer Experience reflect the
brokers' performance across the survey's 12 key categories. Yet
the brokers' specific areas of strength varied.
There were firms, such as Scottrade, that just missed the cut
in a number of categories. And within the top five lists for each
of the 12 specific characteristics, other firms also shined
besides the top five brokers overall.
Do you like to plunge into a company's fundamentals and read
analyst notes? Then you should look at which brokers ranked well
in the Investment Research category. TD Ameritrade andE-Trade (
) made the top five in this area, along with Fidelity, Schwab and
Yet some investors have a different approach. Andrew Selby
belongs to this camp. He's an investor who follows IBD's CAN SLIM
stock investing strategy and blogs at
Don't Talk About Your Stocks
"I get all of my research from the newspaper and from
MarketSmith," he said.
sister firm that provides stock charts and other data online.
So maybe trading stocks on the run is more important to you.
If so, then check out which brokers earned praise in the Mobile
Platforms/Trading category. A separate article in this section
zeros in on
Michael Lamothe, who runs ChartYourTrade.com, says mobile
tools aren't the No. 1 feature he demands from a broker, but they
are an important secondary consideration.
"I do a lot of my work on the go, and so having a strong
mobile platform is important," Lamothe said. He added that he's
"someone who trades part time and has a full-time career," so he
Three other categories also get examined in further detail in
three articles in this special report: Tax Preparation Tools, ETF
Choices and Options Trading Platforms.
The Low Commissions & Fees category is self-explanatory,
but do look at that list if you trade a lot and want to minimize
the cost of each buy and sell, or if you like passive index funds
and keeping costs low. Interactive Brokers, OptionsHouse,
Vanguard and TradeKing fared well in this area, as did USAA.
Lamothe says the No. 1 thing he demands from a broker is low
fees. He notes that active growth-stock investors often will make
two or three buys to achieve a full position, followed by
multiple sells when they scale out of a position.
"It's reasonable to expect to have a large number of
transactions in a given year, especially if you're pyramiding
into a position," he said.
That means fees can really add up if they're on the high side,
wiping out some gains.
Trade Reliability and Customer Service are also
straightforward categories. You can assume the online brokers
that scored well in those areas, such as USAA, Schwab and
Vanguard, generally haven't exasperated the survey respondents
with trade glitches or difficult call-center staffers.
If you resolved to learn more about investing, pay attention
to the Educational Resources category. OptionsXpress and TD
Ameritrade are among the leaders in this area, according to IBD's
Here is a complete rundown of all of IBD's Best Online Brokers
Overall Customer Experience
Low Commissions & Fees
Options Trading Platform
Portfolio Analysis & Reports
Tax Preparation Tools
Equity Trading Tools