Cheapest Stock Brokers: Which Discount Brokerage Is Best?

Are you looking for the cheapest stock brokers? With job loss rates at all-time highs and uncertainty about our futures, we’re living in unprecedented times. Saving money is more important than ever.

And with the volatility we see in the job market, now couldn’t be a better time to learn how to trade stocks. Our in-depth review of two of the cheapest stock brokers will get you started, so you take your future into your own hands. 

Who Are the Cheapest Stock Brokers?

The cheapest stock brokers as follows:

  1. Interactive Brokers
  2. Fidelity
  3. ThinkorSwim
  4. Robinhood
  5. Webull
  6. TradeZero
  7. Lightspeed
  8. Tastyworks
  9. E*Trade

Interactive Brokers

Cheapest Stock Brokers

My first pick is one of the best and cheapest stock brokers out there is Interactive Brokers.

Interactive Brokers is well known for two key elements; its international trading platform, and low fees and commissions. I must mention Trader Workstation (TWS); Interactive Broker’s proprietary trading platform.

One of the things most traders like about TWS is that you can customize it, including making use of third-party plugins and apps to suit your trading style.

Furthermore, one of the best features of the Traders Work Station (TWS) platform is its shorting ability. When compared to other brokers I’ve researched, IB has the most substantial amount of stocks available to short.

On the whole, IB is suited best for serious traders looking to trade on international and even exotic markets. Worldwide it’s used by tens of thousands of traders as it allows you access to markets in 24 countries.

Including pretty much the whole spectrum of securities from equities to bonds, to Forex to commodities. Read our Interactive Brokers review.

Fees Broken Down

For shares, it will cost you 0.005 with a minimum fee of $1 for each order and a maximum fee of 0.5% for the order. For those of you who like options, the prices range from 0.25 to 0.70 per contract, with a minimum charge of $1 per order.

These fees are much lower than what’s found elsewhere in the industry. Take Fidelity, Interactive Broker’s nearest competitor, for example.

Fidelity charges $7.95 for 100 shares, whereas IB charges only $1.00 for the same 100 shares. To be honest, active, high volume traders will struggle to find a more competitive platform than IB.

Furthermore, unlike most other brokers, IB does not charge an additional flat fee on top of their costs and commissions.

Check out our trading service for more information on the cheapest stock brokers.

Who Is Interactive Brokers Best Suited For?

Cheapest Stock Brokers

IB is ideal if you are an experienced, active trader because their commissions are some of the lowest in the entire industry! 

Their low commission structure, fees and minimum balance requirements most benefit high volume and high-frequency traders.

Combined with access to international markets makes it ideal for those looking to dip their toes in faraway waters. It’s also most certainly for those wanting to save on commissions, which is probably most traders. 

On the flip side, beginner traders may find TWS somewhat overwhelming. Using the advanced features will require a steep learning curve, one beyond your needs and abilities.

Quite frankly, you’d be better served to master the fundamentals before using a platform like this. Besides, if you plan to dabble, the minimum commissions and balance requirements will cost you unnecessary fees.

That’s why, for beginner traders, I recommend learning on a platform like ThinkorswimComing in at a close second in our review of the cheapest stock brokers is Fidelity. 

Fidelity

Fidelity is not only one of the best low-cost brokers but operates as a discount brokerage firm for the mass of individual investors. They have lowered their fees and are some of the best amongst the brokers out there!

In fact, Fidelity charges no fees on stocks, ETFs, or OTCBB (penny stock) trades. And for passive investors, the numerous options to trade ETFs and mutual funds commission-free seal’s the deal.

Another edge for Fidelity is their order execution. Did you know that over 96% of their orders take place at a price that is better than the national best bid or offer? This translates in substantial cost savings for day traders on almost every trade.

While Fidelity thrives in its offering of security selection and fees, it falls short in the day trading department. Many, day traders struggle due to the lack of level 2 data, hotkeys, VWAP, float and persistent issues with streaming quotes.

However, I do believe Fidelity delivers value for investors and is a cost-saving method for those in it for the long game.

Without a doubt, Fidelity is value-driven, full-service online broker catered to investors. Moreover, with no money needed to open an account, it’s a great place for beginner investor to start.

Likewise, if you are primarily trading equities and you want to keep your costs down as low as possible, then Fidelity might be the cheapest brokerage for you in the world of cheapest stock brokers.

One Additional Thing to Consider When Choosing Cheapest Stock Brokers

To be frank, some brokers aren’t worth their weight in gold. These fly by night operations are more than happy to take your money but when your computer crashes or your need to reach support, you’re out of luck.

As a rule of thumb, you should look at FINRA’s BrokerCheck page; especially if it’s a small firm. Ensure they’ve not had claims filed against them for misdeeds or financial instability. 

When looking for the cheapest stock brokers, stick to the ones on this list and you’ll be protected from bad ones

Where to Go From Here With the Cheapest Stock Brokers?

You have options when it comes to the cheapest stock brokers out there. Nowadays, a common mistake is to choose something based on price, not the quality of services provided.

For these reasons, it’s wise to check out our video on How to Open a Brokerage Account. Luckily, the two brokerages I talked about come with a cheap price tag but deliver big on the value side. 

Make sure to take our free online trading courses to best utilize the cheapest stock brokers. Happy trading!

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