My Favored Discount Brokerage

by Dr Invest


I have held accounts with most of the brokerages, with each having unique services they offer to their clients. Most of the fees you only learn about after you have become a client. For instance, Lowtrades charges a $50 fee if you don't make at least one stock trade every six months and a $4.95 trading fee everytime you buy and $4.95 everytime you sell. With LowTrades, you need $2,000.00 just to open the account. So follow me here... if you make a $1000.00 stock purchase, you have to make 1% just to get back to even, because buy and selling at LowTrades cost you 1% or $10 in fees. If you buy $500 worth of stock through the LowTrades Brokerage, the $10 brokerage fee is 2% of the $500. Before you can BREAKEVEN, you have to see a 2% gain. When an annual gain of 6% is considered a good return, subtracting your 2% fee leaves you with only 4% profit left.

Now I don't mean to depress you here, but if you consider that inflation has averaged 3%, then you have only 1% of your profit left from your trade. Now did I mention that you need to pay income taxes on that trade? When you consider that TD Ameritrade is going to charge you $9.95 to buy and another $9.95 to sell, using the right brokerage for smaller trades becomes even more important.

WELCOME OptionsHouse

OptionsHouse is for the small investor who wants to try their tradings skills in the market place. For only $1000.00 you can open an account. To buy stock is $3.95 and to sell stock is only $3.95. One plus is the OptionsHouse Trading Platform. You can see in REAL-TIME what the market is doing and what your stocks are doing. A special feature is what is callled a VIRTUAL ACCOUNT. You can place a vitural cash deposit into your virtual account, and then use that cash to make trades. The virtual account lets you practice your trading skills, keeping record of your gains and losses. When you are ready, you can return to your ACTUAL ACCOUNT and make trades that will either make you or break you.

I am sold on OptionsHouse at this time. My experience tells me that when OptionsHouse has fully developed their product and gained sufficient clients, they will find ways to charge their clients for all these services. But for now OptionsHouse seems to be one of the best brokerages out there.

(Note: No suggestion is being made regarding financial service companies and the information herein is soley for entertainment purposes.)