5 Best Stock Brokers for Beginners
One of the first (and most important) choices any investor will make after deciding to work towards their financial future is what brokerage they will use to accompany them to their goals. As investors, we must place an incredible amount of trust in our chosen brokerages; our brokerages buy for us, sell for us, help us research prospective investments, and even give us tools to help us save and spend according to our retirement goals.
With so many brokerage choices available in this day and age, it can be difficult to determine which platform will be most beneficial to your financial success. But never fear; that’s why Wall Street Survivor is here to help you narrow down your choices! We’ve done all the grunt work for you: our team of analysts have poured through all of the brokerage choices out there, and we’re proud to present you with a list of the best brokerages for investors of different types and experience levels. Enjoy!
Robinhood: Best Stock Brokerage All-around
Robinhood should have a special place in the heart of every investor. Robinhood led the investing revolution that succeeded in democratizing the world of investing forever.
In the past, entry to the investing world was restricted to the wealthiest and most powerful members of society; investing was a privilege afforded only to the few, not the many. In order to begin investing, an individual would have to fork over large sums of money in order to gain admittance into a mutual fund or otherwise pay astronomical commissions in order to be able to buy and sell equities or bonds. Even recently, the largest and most popular brokerages would charge unrealistic commission and management fees to their members.
But Robinhood had a different investing model in mind; they wanted to bring the world a commission-free investing platform that would allow investors with all levels of income to be able to create a portfolio without breaking the bank. After breaking into the stock brokerage industry, Robinhood disrupted the market and took the investing world by storm. When Robinhood quickly gained millions of users, the big brokerages realized that they had no choice but to follow suit.
Now, many of the biggest brokerages in existence offer commission free trading; but we at Wall Street Survivor will never forget that Robinhood was the first player to bring balance and equality to the world of investing.
In addition to its valuable contribution to the investing game, Robinhood also boasts a modern user interface accompanied by revolutionary new features. The home page is easy to understand for young and more mature investors alike, making it easy to see what you’ve gained in a given time period. When you press on a stock or fund to see its information, Robinhood will provide you with the basic fundamentals needed to make informed investing decisions, as well as news and analyst reports regarding the chosen security.
You can access Robinhood directly from your phone using their simple, sleek app. Robinhood also offers incredible features for the modern investor such as margin trading, fractional shares, premium research tools, options trading, and Cash Management accounts that allow you to use a Robinhood debit card to make transactions directly from your brokerage account. Click here to make your very own Robinhood account today!
M1 Finance: Best User Interface
When it comes to ease-of-use, M1 Finance is the clear winner. M1 offers a modern design and convenient investing tools that will benefit beginner and advanced investors alike.
M1 Finance functions as a sort of middle-ground between robo-advisors and full service brokerages. It offers typical robo-advisor features such as automatic investing, rebalancing, tax harvesting, and preset portfolios.
At the same time, if you are a more hands-on investor, M1 will give you the freedom to make your own portfolio and invest your money however and whenever you’d like. M1 uses a “pie” system to define its portfolios and sections of portfolios; you can create a pie by combining different stocks, fixed assets, and funds, or choose ready-made M1 pies composed of ETFs, target-date funds, mutual fund replications (like Berkshire Hathaway), or social impact investing funds. You can then divide up your money within this pie, or use the pie as a section of an even larger pie.
For example, if I want to create a portfolio made up of 25% Apple, 25% Microsoft, and 50% IBM, you can easily make this happen by creating a pie with these percentages in the M1 app or website. You can then deposit money into this pie and your cash will be divided up accordingly, or you can make this pie a portion of a larger pie. You can also put your money into several different pies at one time. M1 also offers a stock research section for investors who would like to stay up-to-date on the latest news and statistics in the stock market.
Wealthfront: Best Robo-Advisor Stock Broker
If you’re looking to get all the perks of having a financial advisor at a fraction of the cost, Wealthfront is the way to go. Wealthfront is designed to do all the work for you; just create your portfolio using the tools in the app, set up a recurring deposit, and watch your money go to work for you.
Wealthfront will automatically rebalance your portfolio to make sure you have the right percentages of your money invested. Wealthfront also offers some great financial tools to help you plan for things like homeownership, retirement, travel, and college.
Acorns: Best Stock Broker for Hands-Off Investors
Acorns, whose motto is “Invest, Earn, Grow, Spend, Later”, is just about as hands-off as you can get when it comes to investing. Acorns’ model revolves around investing your “spare change”; every time you make a purchase, Acorns will round up the transaction amount to the nearest dollar.
The extra change is then added to your Acorns account and automatically invested. For example, if you buy a meal that costs $10.20, then $0.80 will be transferred to your Acorns account and invested in your portfolio. These spare change transfers can really add up, especially if you make a lot of regular purchases.
Acorns is easy to start and easy to maintain; you can create an account in less than five minutes and choose one of Acorns’ preset funds, and the app will do the rest.
thinkorswim: Best Stock Broker for Data and Analysis
If technical analysis is your thing, then thinkorswim is the perfect platform to help you accomplish your goals. Here at Wall Street Survivor, our goal is to focus on investing rather than trading; however, we respect any method that our fellow investors choose to use in order to work towards their financial futures, and that’s why we want to tell you about thinkorswim.
thinkorswim is TD Ameritrade’s trading platform, designed to help you analyze market movements like historical patterns in price and volume. TOS is known for its plentiful amount of bells and whistles, which is why it’s our pick for more advanced investors. There is certainly a lot to learn in the platform, but once you have a grasp on all the features it offers, you’ll be able to tailor your trading experience to your specific preferences with capabilities such as advanced charting, scanning, and watchlists. One of the best parts about TOS is that it offers paper trading simulations – make sure to try your hand at this before you dive into day trading!
As you can see, there are plenty of brokerages out there that are ready to help you along the way to your financial goals. It’s really just a matter of deciding which platform best suits your particular investing style and preferences. And don't worry, if you feel like you need to take a step back and learn more about what a brokerage is and does, check out our Starter Guide: Introduction to Stockbrokers. At the end of the day, you can always make multiple brokerage accounts if you’d like!