Forex Trading

How to choose a broker for investments?

US stock brokers are intermediaries who are members of the trading floors and conclude transactions for the client. It is impossible to do without it, because it is brokers who have trading places on stock exchanges.

How to choose a reliable US stock brokers

The first question an investor should ask himself is about the reliability of US stock brokers. Money in the bank account is protected by the deposit insurance system. For the broker, even though it is separated from his own assets, it is in a common pool with the assets of other customers, and is not protected by the insurance agency. Their safety largely depends — on the professionalism of the broker. He always knows what the MSFT stock price is today and when it is better to buy or sell.

The broker’s experience and individual approach

With the huge choice of organizations, providing brokerage services, it is not difficult to notice that there are ten or two leaders with the absolute majority of accounts opened. Other companies settle for what little is left.

However, the quantity of the brokerage accounts and volume of the operations, though, witnesses the broker’s experience, but on the other hand, does not guarantee the quality of services at all. In such organizations services are based on the flow, and it is hardly possible to solve something individually.

Membership and Access to Exchanges

Exchange places sometimes cost a lot of money. That’s why not all brokers can purchase them, and many of them act through intermediaries themselves. This is especially true for foreign exchanges, if the investor at some point outgrows the domestic market.

Of course, you can successfully use the services of a discount broker and not even think about the fact that in fact he only owns the server that collects applications from customers and transmits them to another organization. The main thing is that this does not make the price of services any higher. Unless something unforeseen happens, or a crisis begins, in which another intermediary is an additional risk.

Don’t you want to keep track of what’s the price of NFLX stock? For a serious investor investing large sums of money in the market, it is important enough to reduce the chain of service organizations. If there is such a possibility, why not work directly with those who have invested money and provide their own services, rather than those of others.

Ideally, the broker should be a participant in all trading platforms, on which one intends to invest, and provide the fastest possible transfer of funds from one segment to another.

Returns since the beginning of the year

Information-trading systems for access to the exchange

A self-respecting broker should provide at any time, as long as the trading venues are open, backup access to execute trades in the traditional simple way — by voice over the phone. At least in case of a technical battle on both the broker’s and the client’s side.

Brokerage commissions and additional fees

Companies ask for very low commissions, such as 0.03 percent of a transaction. It is important to clarify

  • Whether this price includes an exchange fee;
  • How much you would have to pay for the depositary services;
  • For the registration of operations on the transfer of title to securities;
  • Whether there is a separate cost for using software and access to real-time quotes.

Some brokers have these extra charges already included in their fees, while others do not.

Entry and Exit Prices

More often than not, brokers are willing to work with clients starting with a certain amount of investment. Will I have to pay a withdrawal fee? If a broker asks for 1 percent of the withdrawal amount, it is understandable that this is not the most favorable option for an investor who plans to earn 5 percent with virtually no risk.

Conclusions

Choosing a broker today is a serious task, one might say, almost without the right to make a mistake. A broker must understand that MSFT after hours stock prices and during business hours are two different prices. Therefore, it is important to consider a lot of factors, which we have described here.

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