By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts.
From beginners to advanced traders looking for options trading, international exposure, and alternative investments, there is a brokerage firm for every investor across all levels of experience, income, and risk tolerance. Learn how brokers work and which ones are the best for you.
Investopedia / Alice Morgan
Best Brokers for 2024
Investopedia’s experts put 26 companies through a rigorous evaluation process to identify the best online brokerages for you. We collected over 2,314 data points and used our subject matter expertise to develop a process for finding the best brokers, focusing on costs, range of offerings, trading technology, and more.
Brokerage accounts are not FDIC-insured like deposit accounts at banks. Instead, the money you have in a brokerage account may be insured by the Securities Investor Protection Corporation (SIPC). The SIPC doesn't insure you against losses resulting from market activity or fraud. The SIPC will reimburse investors for up to $500,000, including $250,000 in cash, in the event of a firm's insolvency. The SIPC only covers member firms.
Yes. Because minors are not eligible to open their own brokerage account, parents and guardians can open and manage a custodial account in a child's name. Funding options for custodial accounts include cash, stocks, and mutual fund transfers. The process of opening a custodial account involves providing personal and banking information and completing a series of forms online.
Find the best brokerage firm and account that satisfies your investing style and needs. Then evaluate how a brokerage can help you manage risk. Apply for and set up the account and then fund the account. Before investing your money in the brokerage account, consider educating yourself about how stocks and other investments work (remember, investing always comes with the risk of losing your principal deposit).
Brokerage cash is a top-line cash total in your investing account. It's the cash amount before stripping out items like unsettled trades and collateral. Not all of your brokerage cash is immediately available for trading or withdrawing. That would be a bottom-line number which may be called buying power, cash available for withdrawal, or something similar. Cash in these accounts can be parked to collect interest, reinvested, or withdrawn for paying bills.
What’s the Difference Between a Taxable Brokerage and an IRA?
Brokerage accounts are taxable investment accounts through which you can buy and sell stocks and other securities. IRAs are designed for retirement savers and allow tax-free or tax-deferred growth on the investments you hold in the account. Unlike brokerage accounts, IRAs have strict contribution limits, and withdrawals may trigger a penalty. Brokerage accounts and IRAs are taxed differently, which can be a deciding factor when choosing an account.
A brokerage fee is a fee a broker charges to execute transactions or provide services for clients. Brokerage fees are based on a percentage of the transaction, as a flat fee, or as a hybrid of the two, and vary according to the industry and type of broker.
A cross is when a broker receives a buy and sell order for the same stock at the same price, and subsequently makes a simultaneous trade between two separate customers at that price. Variations of this are the market opening and market closing crosses
Best execution is a legal mandate that requires brokers to seek the most favorable options to execute their clients' orders within the prevailing market environment. Best execution is a significant investor protection requirement that obligates a broker to exercise reasonable care when executing an order to obtain the most advantageous terms for the customer. It requires brokers to examine, track, and document when routing an equity investment, an option, or a bond order for execution.
The buy side is a segment of financial markets made up of investing institutions that buy securities for money-management purposes. A business involved in buy-side activities will purchase stocks, bonds, and other financial products based on the needs and strategy of their company's or client's portfolio. Common buy-side institutions include hedge funds, pension funds, and mutual funds.
A deep discount broker is an agent who mediates trades on exchanges between securities buyers and sellers at even lower commission rates than those offered by a traditional discount broker.
The sell side is the part of the financial industry that is involved with the creation, promotion, and sale of stocks, bonds, foreign exchange, and other financial instruments to the public market. The sell side can also include private capital market instruments such as private placements of debt and equity.
A joint brokerage account is a type of investment account owned by two or more people. It allows multiple individuals to contribute funds toward investments and make trading decisions together. Joint brokerage accounts are commonly opened by married couples, siblings, or business partners who want to invest together and pool their resources.
A trailing commission is a fee you pay a financial advisor each year that you own an investment. The purpose of a trailing commission is to give an advisor an incentive to review a client's holdings and provide advice. It is essentially a reward for keeping you with a particular fund.
Hard dollars are cash fees or payments made by an investor or customer to a brokerage firm in return for their services. Hard dollar payments are usually set amounts that are known before a customer begins dealing with a broker. Hard dollar payments include set transaction charges, monthly account maintenance charges, as well as paying for research provided by the brokerage firm.
:max_bytes(150000):strip_icc()/bestbrokersTaxSCpageimage-5060321b22a84f7bb7987d491ff4fc0c.png)
:max_bytes(150000):strip_icc()/bestbrokersTaxSCpageimage-5060321b22a84f7bb7987d491ff4fc0c.png)
:max_bytes(150000):strip_icc()/PRM-BestBrokerAwards-BestOnlineBrokersandTradingPlatforms-1eb95e8ab19646f78d688a7df41a1f55.png)
:max_bytes(150000):strip_icc()/howtoopenonlinebrokerageaccount-3075fa1a9fa4447293ccee1838a226ec.jpg)
:max_bytes(150000):strip_icc()/broker.aspfinal-33e95da8ded44831a5703fdd6723f129.jpg)
:max_bytes(150000):strip_icc()/Fidelity_Investments_Recirc-64c268bfd0824442ab46e820805d5474.jpg)
:max_bytes(150000):strip_icc()/PRM-BestBrokerAwards-Methodology2-4472d15f143c4c259a623971af8da200.png)
:max_bytes(150000):strip_icc()/joint-brokerage-accounts-7497852-final-cd591b0b058c49b684536ade5c193289.png)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-buy-dividend-stocks-7503745-3a40ff09887548ac9dd2c6406b200a82.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-trade-forex-7499569-44467e75edf24375a03f63fe6f791310.jpg)
:max_bytes(150000):strip_icc()/how-to-open-an-ira-7504812-final-4c3a28be178349e2a1ab0b5f9087d9c8.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-invest-in-ai-in-2023-7504987-96d9182bb4b44d16abac4dec06adbfc3.jpg)
:max_bytes(150000):strip_icc()/HowToBuyStocksOnEToro-1400280368-a70f5c70b3bb4831a593f951ccb2a460.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-buy-fractional-shares-on-webull-7499351-42d9405110714d1cb5de848ffe68fd5d.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-trade-options-on-webull-7500939-303e731955e5479ab73979c61c2e0370.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-buy-fractional-shares-on-fidelity-7499561-51f5f52f9bd14b65b21ad81e64fa59c4.jpg)
:max_bytes(150000):strip_icc()/bestaccountsforuninvestedcash-91147036afd04192988327f357a7dbbb.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-best-swing-trading-platforms-2023-7485679-4c3fb7dca1f84ea7a377d8396d0096b0.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-buy-fractional-shares-7482606-139e9199be8e4f43b8c197f29e24d397.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1370827731-8629ef54007a4e219cd6a3b133ab6c9b.jpg)
:max_bytes(150000):strip_icc()/financial-advisor-meeting-in-a-bank-office--1060800958-002680a286674fc3801982602d7527c2.jpg)
:max_bytes(150000):strip_icc()/laptop-ff1f4080ad344d5bb966daf23d4a449f.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-invest-in-web-3-0-in-2023-7480982-787d9b953b4944f9b8ed25a284228269.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-best-ways-to-earn-passive-income-in-2023-7481030-fe62d4d820be4ee4aad14a3eb46501a5.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-how-to-invest-in-gold-and-silver-7369625-32ca92a5fd0542b39761f0b1241438ff.jpg)
:max_bytes(150000):strip_icc()/Primary-Image-robinhood-vs-webull-6754841-fa57f8e358684145becfd90fd6bf8b7d.jpg)
:max_bytes(150000):strip_icc()/Webull-vs-Interactive-Head-to-Head-0bd2e230d7f74db7ba7a7c149cb52036.jpg)
:max_bytes(150000):strip_icc()/eToro-logo-20d30156718947bcab27419d63c29ff3.jpg){kind=logo}
:max_bytes(150000):strip_icc()/JP-Morgan-Chase-and-Co_recirc-ca7bed85d81642989386458c028d1e54.jpg)
:max_bytes(150000):strip_icc()/Wealthsimple_recirc-d7684c43d7074c1fa439f40e3a03fb7e.jpg)
:max_bytes(150000):strip_icc()/bestonlinebrokers-e29ccfc98f36477e834c7397f80efb55.jpg)
:max_bytes(150000):strip_icc()/Before-You-Open-a-Brokerage-Account-572a9eb55f9b58c34c9483e6.jpg)
:max_bytes(150000):strip_icc()/CashAccountsandMarginAccounts-565977b43df78c6ddf4d7440.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1384260398-4e55b65fbb8b40cabea0971e812be72a.jpg)
:max_bytes(150000):strip_icc()/bestbrokersfordaytrading-35c5061a73e84a2f918551a21fca4137.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1370827731-b3797d4950dd441abcc13178c8a9c132.jpg)
:max_bytes(150000):strip_icc()/inv-best-of-template-1-5c54764946e0fb00013a21a0-5c61814046e0fb0001587722.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1288668811-bf31a6a47e054185967e55b8d15fcf24.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1317703626-ae9fb25dd12c4bd3b0884b971fd015ed.jpg)
:max_bytes(150000):strip_icc()/PennyStocks_Sitthiphong-f0ec21fb73d2484e9d200618ca85100e.jpg)
:max_bytes(150000):strip_icc()/TradingPlatforms_Chervov-dfe01706a3c5463aaa96883cc36e8722.jpg)
:max_bytes(150000):strip_icc()/slide-chuck-13961b873d064244bc067d590eec707e.jpg)
:max_bytes(150000):strip_icc()/business-financial-and-forex-concept--hipster-young-woman-freelancer-thinking-about-her-job-and-using-computer-laptop-showing-trading-graph-with-the-stock-exchange-trading-graph-screen-background-807201430-5962b6b95f9b583f180d921e.jpg)
:max_bytes(150000):strip_icc()/making-trading-online-on-the-smart-phone--new-ways-to-make-economy-and-trading-957725692-7b83f089bac344b49b0a367135e7da82.jpg)
:max_bytes(150000):strip_icc()/GettyImages-10274381821-89cf5a24cb5942ccbdf1b19cf40bf5c6.jpg)
:max_bytes(150000):strip_icc()/charles-schwab-vs-vanguard-1dd42e790b9f4001b80ece2059b65f25.jpeg)
:max_bytes(150000):strip_icc()/ETF_Ingenious-Buddy-da3c12ef24694a9983199966dec9b402.jpg)
:max_bytes(150000):strip_icc()/shutterstock_67023106-5bfc2b9846e0fb005144dd87.jpg)
:max_bytes(150000):strip_icc()/117860423-5bfc2b9d46e0fb0051bde381.jpg)
:max_bytes(150000):strip_icc()/GettyImages-172670299-a5b96faa1ecc433f88ec1893627583ef.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1384219104-e9b3945b683a4f96abdad653bdab2d91.jpg)
:max_bytes(150000):strip_icc()/ScottradeCenter-674c5143b2ab45f198195fa1ffde9a95.jpg)
:max_bytes(150000):strip_icc()/bonds-lrg-5bfc2b234cedfd0026c104e7.jpg)
:max_bytes(150000):strip_icc()/GettyImages-1174933373-8b411833ac0c4570995a2bd7e7907864.jpg)
:max_bytes(150000):strip_icc()/complete-guide-to-brokers-58dc19c65f9b58468334e1dc.jpg)
:max_bytes(150000):strip_icc()/GettyImages-479477674-6cdc5e32886f464fa64de955d85dc5d8.jpg)
:max_bytes(150000):strip_icc()/broker-346281d4cdf94db5a910afdbd7891f9c.jpg)
:max_bytes(150000):strip_icc()/GettyImages-523723700-f2ad6458d6dc4f62944ada03fbdbe42a.jpg)
:max_bytes(150000):strip_icc()/115556938-5bfc2b9d46e0fb005144de45.jpg)
:max_bytes(150000):strip_icc()/141251781-5bfc2b9c46e0fb005144de21.jpg)
:max_bytes(150000):strip_icc()/GettyImages-596464468-0f01491a60f74330af0b6576b0327ca5.jpg)
:max_bytes(150000):strip_icc()/investing5-5bfc2b8e46e0fb0026016f0e.jpg)
:max_bytes(150000):strip_icc()/retail-shop-5bfc2b7cc9e77c002630622e.jpg)
:max_bytes(150000):strip_icc()/aa010876-5bfc2b9cc9e77c005143f33c.jpg)
:max_bytes(150000):strip_icc()/consulting-auditors-auditing-financial-report-on-computer-screen--business-charts-844471454-a05704af32ac4b5182a5dc5a2d4f3277.jpg)
:max_bytes(150000):strip_icc()/collaboration-d8b90cfd1c6b429ea27a77bbca1c6233.jpg)
:max_bytes(150000):strip_icc()/GettyImages-218281-91c1d3a5cc0447daaf63f9481b4a4b58.jpg)
:max_bytes(150000):strip_icc()/investing15-5bfc2b8fc9e77c00519aa65b.jpg)
:max_bytes(150000):strip_icc()/GettyImages-932632502-2328873f601a4939846d103637f93698.jpg)