I am 22 years old and have never had an account before. Is there a place where I can look at the information for the most popular brokers, including hidden fees? Ideally I would open an account somewhere with no inactivity fees (I can't see myself making more than twelve transactions per year), and a minimum balance of less than $1000.
You could start with TMF Broker Center at http://www.fool.com/how-to-invest/broker/index.aspx but keep in mind that the brokers listed are paid advertisers.Many of the business and finance magazines annually run an article comparing brokers. Check Kiplingers Personal Finance, Money, Barrons, etc.The American Association of Individual Investors does an annual evaluation of brokers. Check http://www.aaii.com/search?SearchText=brokers Much of the information on their site is for members only.Bob
Start at the Find a Broker page under the How to Invest tab from the Fool.com home page.http://www.fool.com/how-to-invest/broker/index.aspx?source=i...Small minimum balance can be a problem. And with trades costing $7 or $8 you will want to watch that commissions don't become a major item. 2% or less is usually best. That implies a $350 minimum investment.For smaller amounts, dividend reinvestment programs can work well. They allow you to buy more of the same stock for a proportionate share of the commission.I am not up to date on this aspect, but there have been Sharebuilder programs that let you work with smaller sums. Perhaps others can provide details or suggest others.
P.S. For the "hidden fees" you would probably have to visit each broker's site to see how well they are hidden.
captaineyebrow,You wrote, I am 22 years old and have never had an account before. Is there a place where I can look at the information for the most popular brokers, including hidden fees? Ideally I would open an account somewhere with no inactivity fees (I can't see myself making more than twelve transactions per year), and a minimum balance of less than $1000.There are plenty of sites that do annual broker reviews.http://www.smartmoney.com/invest/markets/smartmoneys-annual-...http://www.smartmoney.com/invest/stocks/the-2011-broker-surv...http://online.barrons.com/article/SB500014240529702035236045...http://consumerreports.org/cro/magazine-archive/may-2009/mon...Each site has its own criteria.Most brokers will open an individual account for less than $1,000. You won't be able to trade on margin of course. And buying individual stocks may be problematic given brokerage commissions.In the end surveys can only narrow the selection down to a handful. You'll have to do things like review their fee schedules and investment options on your own.- Joel
pauleckler,You wrote, For smaller amounts, dividend reinvestment programs can work well. They allow you to buy more of the same stock for a proportionate share of the commission.I assume you mean a direct corporate DRiP? I've never seen a broker's dividend reinvestment program that allowed you to buy more stock (beyond the amount in the dividend) without paying a commission.BTW, the OP should look into commission-free ETFs. In my earlier years, funds were considered a better choice than buying blocks of individual stocks at a broker. With a mutual fund you can accumulate capital in a few funds without incurring commissions, then switch to individual issues after you've accumulated a core investment portfolio. These days ETFs usually have lower expense ratios than regular mutual funds, so it might be best to apply this strategy in your early years to ETFs at a broker that offers a decent commission-free ETF list. As far as I'm aware, Vanguard, TD Ameritrade and Fidelity offer pretty decent commission-free ETF lists. When you have a decent amount of seed capital, branching out into individual investments makes more sense.- Joel
There's an updated edition of the Barron's survey for 2012:http://online.barrons.com/article/SB500014240527487047597045...I like the annual Barron's survey the best, but the SmartMoney and Motley Fool links that were posted already are very good resources too.If you're a Consumer Reports subscriber, they refreshed their ratings back in the February 2012 issue as well, but they don't have that content on the web for free viewing. There's a summary on a blog that I found though: http://www.bargaineering.com/articles/consumer-reports-disco...
Just go from website to website. TD Ameritrade and Schwab are good. I don't know about activity fees and you will probably have to watch the minimum. Personally, with your age and investment amount, I would go with a nice growth oriented no load mutual fund.
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