Best Broker for US Low Priced Stocks

[butterfield 10]

Guys,

 

I need your help deciding which DMA broker to use. I have a daily strategy buying (or shorting) stocks at the close of the day to sell them (or buy them back) at the close of the next day. I have been using IB and have been happy with the system and their commissions ($0.005 per share), the problem is that lately I have been trading more low priced stocks so the $0.005 cost is starting to be very steep for me. IB does not have the pricing structures others like TD Ameritrade have where you can pay a fix price "per ticket" instead of "per share", I would rather pay $9.99 per ticket instead of $0.005 per share when trading $1 priced stocks.

 

So I am forced to change brokers... considering that I only buy and sell U.S. equities and don´t need fundamental research of sophisticated graphs... Which broker would you recommend me to use?

[PerqL8 10]

Take a look at TradeKing. It has some nice trader goodies.

[jdevron 10]

Have you tried speed trader? http://www.speedtrader.com

I have not used them before but they advertise 39c per 100 shares.

 

Hope this helps,

John

[Patuca 13]

check out just2trade.com ..unlimited shares 2.50 to buy 2.50 to sell for 5.00 RT

[hollisnan 10]

I have been using TradeStation, which offers a choice of fixed commissions or a penny-a share plan. If I trade 100 shares of any stock, my commission is $1. That said, I do pay about $100 /month for their data feed (which is waived if you trade 5000 shares in any given month). Looks like you've got a couple of good suggestions to check out!

[mishnas 10]

Optionshouse.com. $3.95 flat rate, regardless of how many shares you buy or sell.

[hollisnan 10]

I've already chimed in on TradeStation, but I'd feel remiss if I didn't say something to the effect that... Commissions and transactions costs are an important consideration in anyone's trading plan. BUT... they are not the ONLY consideration. What about reliable execution? Spreads? Slippage? Customer service? Resolution of complaints and discrepancies? These and other factors should be part of the decision tree. They can effect profitability as much as the commissions can.

[butterfield 10]

WOW, all these are great suggestions, I´ll get on it right away.

 

TradeKing

Just2Trade

OptionsHouse

 

I have already checked out TradeStation and it looks good at first-glance but their "per share" comm is $0.006 which is higher than IB´s $0.005 (bundled) and their Flat-Fee is $6.99 but after the first 5,000 shares they charge $0.006 per share... being that my average ticket is around 10,000 (remember I trade low-priced stocks) it makes no sense, that is why I need to find a broker with good execution and with a flat-fee per ticket.

 

Any other recommendation?

[nandv 10]

A follow up question, how about option trading?

I am aware of thinkorswim, now part of TD Ameritrade.

Any other with good pricing, and good software?

Thanks.

[hollisnan 10]

To add to all this intrigue >;->, the February 2011 edition of Kiplinger's Personal Finance magazine has an article titled "The Best of the Online Brokers" (p34) that references some of the names we have been vetting here. You may find it interesting!

[butterfield 10]

To add to all this intrigue >;->, the February 2011 edition of Kiplinger's Personal Finance magazine has an article titled "The Best of the Online Brokers" (p34) that references some of the names we have been vetting here. You may find it interesting!

 

 

Thank you Hollisnan, I already followed your advice and visited Kiplinger´s webpage, its "Best of the Online Brokers" article was extremely helpful.

 

Thank YOU.

[hollisnan 10]

Now that Butterfield had clarified his trading strategy, it puts things in a new perspective. I guess there are different ways to define "low priced stocks". For some, it's anything less than $10. For others, it's anything less than $1. IDEA - a (hopefully) simple Excel spreadsheet to calculate the commissions for several brokers at different share prices and order sizes. This could be expanded into the type of regression analysis they teach in business school, to optimize a set of variables for a wide range of possible scenarios, but that would probably be WAAAY over our heads.

 

Just for clarity, TradeStation does offer a fee-per-trade option. Pick yer poison!

 

I stand by my earlier point that even modest variances in execution, sliippage, spreads and other factors could outweigh differences in commission rates. Caveat trader!