Investment Broker Ratings - Best of 2010.

While the market crash of 2008 was the worst since the 1929 stock market crash, there is a silver lining for investors. When the market plummeted in 2008, panicked investors pulled out of stocks en mass. This left discount investment brokers hurting for customers, and one of the best ways to get new customers is to lower your prices. This has led to a discount broker commission price war, which leads to lower fees – maybe!

A joint SmartMoney/Synovate survey found that the number of discount broker customers willing to switch for lower commissions nearly doubled last year. So, it’s no wonder that brokers are in a race to the bottom as they cut commission fees, but does this really result in lower investing costs? Sadly, no. Brokers also realize that if they give the house away on low commissions, they’ll be out of business before too long. So, they pad offerings with new fees, or they cut their services.

The result is that often times investors may pay less in commissions, but pay more overall in other fees.

That’s where this joint SmartMoney/Synovate survey comes back into play. They’ve analyzed the results and come up with the best investment brokers of 2010, each rated on 6 criteria, and formatted into an easy to read chart of the top 17 discount brokers.

I encourage the reader to read the full results at the SmartMoney website, since they provide far more detail on each broker and the results. But here’s just a little taste of those results…

Best and worst of 2010.

1. Commissions and fees

BEST: USAA (http://www.usaa.com)
WORST: Banc of America(http://www.baisidirect.com)

2. Customer Service

BEST: TradeKing (http://www.tradeking.com)
WORST: Sharebuilder (http://www.sharebuilder.com)

3. Trading Tools

BEST: Fidelity (http://www.fidelity.com)
WORST:Wellstrade (http://www.wellstrade.com)

4. Mutual funds and investment products

BEST:Charles Schwab (http://www.schwab.com)
WORST: Sogotrade (http://www.sogotrade.com)

5. Banking services

BEST: E-Trade (http://www.etrade.com) and Fidelity (http://www.fidelity.com)
WORST: OptionsXpress (http://www.optionsxpress.com)

6. Research
BEST: Charles Schwab (http://www.schwab.com)
WORST: Wallstreet-E (http://www.wallstreete.com)

Final thoughts.

I think a list like this is a good place to start when looking for a new broker, but I don’t think it’s the only place to go. I suggest using it as a jumping off place, a menu if you will. Take the top 5 or so and research them in greater detail. It’s also important to know what you’re looking for. For example, I use Sharebuilder and it’s ranked horribly, but for what I use it’s been great. I don’t need 24/7 customer support. I don’t need access to hedge funds or the ability to purchase gold. I buy simple index funds and ETFs, on a regular schedule regardless of where the market is at that time. I’m dollar-cost averaging for the long term. I probably wouldn’t choose Sharebuilder if I was a more active trader.

It’s all about what suits you and your style, because you’re going to have a difficult time finding a one-size fits all discount broker.


Related Posts
  • How to spot an investment scam. In a single day, investment fraud can take away everything you've spent your life building. Couple that with the knowledge that scam artists are most active when times are very good, and when times a tough. You don't need me to tell you that times are tough these days, and......
  • When it Comes to Investing, Simplicity Rules. There was a time when only the wealthy and well connected could invest in the stock market. Then IRAs and 401(k) plans ushered in a new era of the "common man" investor. Flash forward a bit more, to the Internet age, and we have a grand democratization of the stock......
  • A Sample ETF Portfolio for Vanguard Fans. The Vanguard family of funds has many fans in the individual investor community. With their dedication to low expense fees, it's no surprise. Much has been made of the drag on performance of high fees, and there is a growing investment community that not only shuns investments with high fees,......
  • Mutual Fund Monday - Tips For Mutual Fund Investment. With thousands of mutual funds to choose from, picking the "right one" can be a daunting task. Most investors know not to fall for a short term hot streak - one or two years isn't a long enough track record to show superior skill of the management team over sheer......
  • SELL ALERT: 3 Stocks to Ditch While You Can? Here's a head's up for anyone holding these stocks - Fair Isaac, Boyd Gaming and Great Atlantic & Pacific Tea Company (A&P). A recent SmartMoney article has hilighted these 3 stocks as having garnered more "sell" recommendations than "buys" in recent weeks. Fair Isaac (FICO) Fair Isaac’s performance is dependent......

Related Websites
  • iPhone 4 Film (FIRST Corporate Film) - "156 Turns" - Ducati Multistrada - Pikes Peak Apple launched their new phones on Thursday, June 24, 2010. On June 27, 2010 we shot a film using only the iPhone 4s. Every shot you see here was taken with Apple iPhone 4. The score is by a guy in Colorado Springs by the name of Luke Atencio.......
  • The Downsides of Free Blogging Platforms for Corporate Blogging (Blogger, etc... focus on how posts may be deleted forever without warning, lack of professionalism, etc...) In a lot of different instances when it comes to blogging, making use of a free blogging platform can really come in handy. If you are writing a personal blog or a blog that......
  • Online Resources For Your Credit Report Questions Credit reports can be confusing to consumers trying to take a closer look at their financial situation. If you are unsure about how to get a free copy of your credit report (hint, it's not from FreeCreditReport.com!) or if you do not understand the information contained on your report, it......
  • A Hard Look At PPC Click Fraud And The Alternatives With the creation of the Overture and Google Adwords systems, several webmasters believed they had finally hit the mother lode. It absolutely was not necessary for tiny on-line businesses to invest giant amounts of money into Search Engine Optimization (SEO) services to realize high search rankings within the natural search......
  • Rubin, $122 Billion, and Obama WedNEWSday - December 31st, 2008 The same day the media blasted us with the news of financier Bernard Madoff's arrest for his "Ponzi scheme," which cost investors $50 billion, there was nothing but silence surrounding a lawsuit that was filed against former Clinton Treasury Secretary Robert Rubin.   Rubin conducted his own "Ponzi......

Leave a Reply

 

 

 

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>