Best US Trading Platforms and Stockbrokers

We’ve used these terms multiple times in our reviews, and you’ve probably seen them tossed around often. They represent two distinct brokerage approaches designed with different audiences in mind.

Traditional brokerages pair trade execution with financial advisory services like portfolio building, monitoring, management, retirement planning, tax advice, insurance, and more. They are typically geared towards high-worth individuals or investors who simply don’t have the time or interest in managing their finances.

The main downside is that full-service brokerages come with fairly high commissions (which you pay with each security you buy or sell) and maintenance fees (that usually run from 1% to 2% of assets under management per year). Fidelity and Charles Schwab are perhaps the most relevant examples of full-service brokerages with a trading platform.

With full-service brokerages, you are essentially paying for the tailored professional service. On the other hand, discount brokerages fill in the gap for self-starters, more often called DIY investors. Their services typically don’t go beyond executing trades and providing industry-standard tools to analyze market data and often include extensive educational materials to help self-starters.

Despite the unattractive name, they carry many attractive qualities: low to no account minimums to begin trading, low to no commissions (many waived commissions following suit Robinhood back in 2019), no administrative charges, and often come with a handsomely designed mobile app – most notably eToro, Webull, and of course, Robinhood.

On that note, we've compared Robinhood and Webull – two giants of discount retail trading. Make sure to read through our comparison before signing up.

The first thing that comes to mind when the word trading is uttered is the stock market. But you probably already know by now stocks make up a large, but still a part, of the world of investing.

Many brokers include stocks by default, but you will also see other assets flying around, from more traditional ones like bonds, commodities, and ETFs to newer players like cryptocurrencies. We tend to navigate towards trading platforms with a wide range of offerings as they allow greater flexibility for branching out and having a diversified portfolio.

• Stocks give you a small ownership stake in a publicly listed company. Their value is determined by the essential supply and demand mechanism, which depends on the market sentiment formed around company fundamentals (financial health), confidence in the industry, and the larger economic environment.

• ETFs are pools of investment. They include a basket of assets, like stocks, bonds, or commodities. When you invest in an ETF, you own a unit of the fund, and the fund owns the underlying assets. They aim to track the performance of an index, like the top 500 largest companies listed on US stock exchanges (simply called S&P 500), a select sector like tech, or a region like emerging markets. With an ETF, you can expand your portfolio instantly for a fraction of the cost.

• Bonds refer to debt instruments issued by corporations and governments. When in need of raising money, these organizations issue loans, which are bought by various entities, and also retail investors like yourself. When you buy a bond, you essentially lend money to the issuer organizations. Bonds are fixed-income securities, as they pay out interest payments over time. You are paid your initial investment back in full when they reach maturity. They both generate income and are less risky than stocks and shares.

• Commodities are considered ‘alternative’ investments today despite being humanity's oldest form of trading products. They refer to tangible products we consume, like metals, oil, gas, or even rice, grains, and sugar. Gold holds a special place – its value usually moves precisely opposite to the stock market, meaning that gold ratchets up when the stocks drop in value. They can be highly volatile and are typically traded through leveraged products (more on that just below).

• Cryptocurrencies made their very controversial entry to full-service and discount brokerages along with cryptocurrency exchanges a while ago. As digital assets, crypto coins exist on blockchains and have limited use as an actual currency. However, due to their speculative nature, they make a high-risk, high-return investment vehicle.

Remember when we said trading platforms help users manage their trades better? These are the ways.

Different Order Types

When you decide on buying or selling an asset, you place an order for it, which is effectively an instruction you give to your broker to buy or sell a security on your behalf. You can use different types of orders to mitigate the risks of your trade or get better prices. Here are the most common types of trading orders:

Real-Time Data, News, and Research

Understanding what is going on in the financial markets helps us make better-informed decisions. Asset prices go up and down depending on the fluctuations in supply and demand, which are affected by certain news like mergers and acquisitions, industry reports predicting how orders will shape up over the next few months, or general commentary on ongoing economic conditions like inflation or recession – ideally, trading platforms provide insights on these, either created in-house or through providing access to third-party publications.

Besides the news, you can also use company fundamentals, which refer to information on an organization’s profitability, revenue, assets, liabilities, and growth potential. This information informs us about a company's overall financial health and whether investors are likely to buy into them or not – or simply, whether their prices go up or down.

And finally, you will need real-time data on price movements. Online trading platforms display these prices, called stock quotes, along with how much time has passed since the change has happened. Ideally, the time lags should be insignificant so that you can base your decisions on the most up-to-date information.

Analytical Tools

Trading platforms offer price charts to analyze the performance of an asset or market. At their core, trading charts are graphic representations of an asset’s price movement over time. Basically, the most valuable information you get is the past and current prices. These charts create patterns that can enable a trained eye to gather information about where the price will go next – although it is not entirely possible to predict what the trajectory will be based on past performance, patterns do indeed repeat themselves from time to time.

Paper Trading

Paper trading is simply using a demo account, with which you can take your trading platform for a test ride. With a demo account, the platform lets you practice buying and selling assets in a simulated trading environment with virtual money. You can place orders or execute your strategies without actually risking your capital. Today, many brokers offer paper trading, including eToro, TD Ameritrade, and Fidelity.

When doing so, it's important to act as if you are actually trading, meaning that you should consider the risk/reward considerations, your trading objectives, and investment constraints so that you are not just gambling blindly. Paper trading offers value for novice and seasoned traders alike – beginners can understand the trading mechanism and gauge whether the particular trading platform suits them. In contrast, experienced traders can test out their investment strategies.

The simple answer is no. Even discount brokerages, most of which market themselves as free, come with a fee – you only pay it in more complex ways, as we discussed earlier. Besides the hidden fees as such, the most common fees include commissions, spreads, and maintenance fees. Let’s look at them in detail;

• Commissions are charged on a per-trade basis and are considered a service charge from the broker for executing your trade. It can be a flat fee ($3 per trade) or a percentage fee – which usually floats around 0.5% to 1%. As we said before, many brokerages waived commissions back in 2019.

• Spreads are built into the price of your trade. It refers to the difference between a certain asset's buy and sell prices. Platforms can also charge fees through spreads, which are mostly used in forex trading.

• Maintenance fees are usually charged by full-service brokerages and can be annually or quarterly. They may be waived if the account meets certain conditions, like a certain minimum account balance or a minimum number of trades.

Whether you end up with some extra on a windfall or you painstakingly generate extra cash for trading purposes – in any case, you should be able to have peace of mind when trusting trading platforms with your money. No need to worry, though, you are somewhat covered.

The trading platforms operating in the US are primarily overseen by two main bodies: the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). SEC’s chief mission is to maintain the integrity of the securities markets and protect investors. It ensures that trading platforms must be truthful and transparent about their operations and the risks involved in investing.

While SEC is an independent regulatory agency of the US government, FINRA is a non-profit organization, although it has regulatory powers. Simply put, FINRA lays out the rules brokers are governed by and assumes the responsibility of their enforcement. The rules aim to regulate brokers and protect investors from unlawful actions that brokers may perform.

Trading platforms typically disclose their adherence to such bodies on their websites in the footer section.

The level of experience is an obvious starting point. If you have zero experience and attempt to begin trading with a platform like Interactive Brokers, you will probably cut and run and end your trading venture before it begins. It’s wise for novice traders to prioritize usability and easy navigation when selecting a trading platform – this often means a lack of advanced tools. Still, you most probably won’t need them anytime soon and can always upscale to a more versatile solution as you advance your knowledge.

If you are serious about trading (and possibly investing) as a beginner, you may want to opt for a full-service brokerage where you can access financial advice from professionals whenever you need it. You may still want suggestions but not be willing to pay an extra dime for them; in that case, you can simply opt for a robo-advisor and put things on autopilot (both of which you can find with Fidelity).

If you are more of a self-starter, look out for a platform with a solid educational department, with TD Ameritrade as the prime example, so that you can have all the resources you need in the same place. It’s also monumentally important for self-starters to use a trading platform with responsive and accessible customer service in case things go south, as they tend to.

Are you just interested in speculating on stocks? Do you wish to diversify to bonds, mutual funds, or more? Are you interested in leveraged products at all?

Your goals may change over time, but it’s healthy to establish what you need from the outset. If you simply plan on buying and holding stocks, you may be just happy with a straightforward discount brokerage like Webull. If you wish to diversify with bonds and funds, you may want to opt for a service with a wide range of offerings and lower costs, like Fidelity. Suppose you are eyeing derivative products like options and futures. In that case, it makes sense to find a platform with far-reaching analysis tools to implement your strategies, like Interactive Brokers or tastyworks.

Establishing your short-term goals helps you find a platform that is not cluttered with features or products that are useless to you. To better set your goals, you can use our investment calculator and get an idea of potential returns.

Are you planning on actively trading, or are you more of a buy-and-forget type? Will you require more information about company fundamentals, or do you plan on losing yourself in the statistical vortex of technical analysis?

Active traders should seek commission-free platforms as trading fees can quickly increase if you frequently place trades. If you continue with active trading and build yourself up to be a day trader at some point, you should begin considering the order execution quality – as you may end up being penny-wise pound foolish.

The approach you will take in your research also affects your choice of a platform: not all platforms are equal in their analytical and analysis tools. Suppose you care more about fundamentals and market insights when making trading decisions. In that case, you may consider legacy brokers that release in-house analyst insights, like IG or Fidelity, and access to other reputable publications. If you wish to carry on with the technical analysis, pay close attention to how in-depth a platform’s charting capabilities are.