What to Look for When
Choosing the Right Broker
There are a number of factors to consider, with cost and product selection just two of them. Here’s how to make sure your broker has the tools you need to be successful.
Information is power, and there’s likely no scenario where that’s more accurate than when it comes to investing. Having the right data at the right time can make all the difference between a portfolio that lags and one that sets you up for long-term success. A critical element of that equation is choosing the right broker.
Among the other important features investors should be evaluating when choosing a broker is the depth of its technology.
Despite the growing number of online platforms touting low cost and ease of use, there are a number of other factors to consider when evaluating brokers. If you’re a beginning investor, education and a bit of hand-holding may be necessary. This might include videos and tutorials on your broker’s website, or in-person seminars at a branch office. Many of these are free when you open an account.
More active traders will want a broker that can support the kind of robust trading they do, and offer tools and features that support and streamline their activities. This can include analysis tools, risk management measurements, customizable workspacesCustom layouts that allow you to personalize your trading environment for optimized efficiency., and competitive commissions and fees.
Interactive Brokers (IBKR), a Greenwich, Connecticut-based securities firm in business for 41 years, offers this kind of holistic platform with its Trader Workstation (TWS).Trader Workstation is a comprehensive trading platform offered by Interactive Brokers. This customizable investing dashboard lets investors trade stocks, options, futures, bonds and funds on more than 120 worldwide markets from a single universal account, and gives them access to robust trading tools and insights.
When investing is integrated into the other aspects of your financial life, you get a more holistic view and can make better money decisions.
In order to trade smartly, investors need accurate and timely information. TWS provides real-time access to comprehensive news, research and market data. For example, investors can get up-to-the-minute news from Reuters and Dow Jones, and digest leading analyst research reports from providers such as Morningstar and Zacks in one place. Coupled with market data on specific exchanges and key financial information on thousands of companies from Reuters Worldwide Fundamentals, investors have access to comprehensive information to help them make smarter investing decisions.
Among the other important features investors should be evaluating when choosing a broker is the depth of its technology. A trading platform that enables real-time monitoring will allow you to see the current state of your account, and provide the flexibility needed to react to market conditions and key economic developments.
TWS lets investors view account balances, funds available for trading and portfolio data for all your investments in one place, including any mobile device. It also allows individuals to create real-time alerts based on price, time or margin in order to stay on top of changes in the market. And for investors trading on margin, it gives quick-glance summaries of any potential deficiencies in an account, an important tool in helping to avoid costly liquidations. A profit and loss screen also lets investors know where they stand at any given time.
The right broker will also give investors the option to take an integrated investment approach. This means navigating from one account, with the ability to trade, earn interest on idle cash, borrow, and spend without switching between accounts or even institutions. IBKR enables that, offering investors the ease and cost-savings that come from a centralized universal account.
And with Barron’s rating Interactive Brokers as a low-cost online broker for 18 consecutive years, this indicates that returns won’t be eaten up by bloated trading commissions and fees. It charges $2.34 per equity trade, among the lowest in the industry, and 69 cents per contract for options trading, with no base cost.
When investing is integrated into the other aspects of your financial life — borrowing, spending, and bill paying, for instance — you get a more holistic view and can make better money decisions.
Of course, most investors may benefit from further learning. IB’ Traders’ Academy offers on-demand videos, webinars, and courses that help better explain asset classes, markets, and currencies, as well as the various features and functionalities of TWS. When investors get this kind of support, along with a robust trading platform, timely market insights, and an expansive product selection, they may be better positioned to make investing decisions and reach their financial goals.
This content was paid for by an advertiser. The views and opinions expressed herein do not necessarily reflect those of Nasdaq, Inc.