Best online stock brokers for beginners in November 2020


You’ve decided it’s time to take the plunge to get a brokerage account. But the task probably sounds just as daunting as answering other big questions, like: What do you want to do with your life?

But, like anything, it’s a matter of breaking down the task into more manageable bites. While options abound, you probably want an account that includes accessible educational resources, an easy-to-navigate app and website, zero commissions, low fees and attainable minimums — all attractive qualities if you are just getting started. Here are several options to consider.

The best online stock brokers for beginners:

Overview: Top online brokers for beginners in November 2020

TD Ameritrade: Best overall for beginners

TD Ameritrade launched its internet-based trading system in 1995.

Beyond its history, TD Ameritrade is good for beginners because of all of the information it makes available to guide you into the world of investment decisions. New investors can take advantage of all kinds of educational material the company offers, including more than 200 instructional videos, tutorials and more.

(Charles Schwab has purchased TD Ameritrade, and will eventually integrate the two companies.)

Competitive edge: It makes available a bot that you can ask whatever question you wish without worrying about whether you’re getting judged for asking something “too basic.” You can also interact with the brand on apps you already use, like Facebook Messenger and Amazon Alexa devices.

Cost: TD Ameritrade’s commission on stock and ETF trades is zero, while options trades cost just $0.65 per contract.

It offers two mobile trading apps: TD Ameritrade Mobile and TD Ameritrade Mobile Trader.

  • Cost per trade: $0
  • Minimum balance to open an account: $0

E-Trade Financial: Best for mobile app

E-Trade is considered by many as an online brokerage pioneer.

Competitive edge: It has kept up with the times, too, offering two mobile apps. On the E-Trade mobile app, you can move money with mobile check deposit in addition to other tasks, such as track the market or trade stocks and ETFs. Its other mobile app is called Power E-Trade, formerly known as OptionsHouse by E-Trade. This app allows you to enter orders, including complex options trades, on a single ticket. You’ll also get streaming news, quotes and a customizable options chain.

(Morgan Stanley has purchased E-Trade, and is operating the broker as a separate unit.)

Cost: Like much of the industry, E-Trade has gone to zero commissions on stock and ETF trades, and it charges no base commission for options trades, too. E-Trade charges $0.65 per options contract, in line with the industry standard, but also offers a discounted price of $0.50 if you make more than 30 trades per quarter.

Importantly, it also makes available all kinds of content to help you understand what you’re doing — videos, articles and live education sessions included. The educational materials and its consumer-friendly apps can be a big help to novices.

  • Cost per trade: $0
  • Minimum balance to open an account: $500

Ally Invest: Best for digital experience

What is now known as Ally started off as General Motors Acceptance Corp, or GMAC, and it served the auto industry.

In time, it started offering consumer-facing products, including mortgages. Then it bought TradeKing and launched Ally Invest in 2017.

Competitive edge: In the past, the account was criticized for not offering commission-free ETFs. But Ally Invest addressed the shortcoming by adding more than 100 commission-free ETFs to its trading platform. Now it’s gone further by making all ETFs on its platform available at no commission.

You can also access your account on Ally’s mobile app to do tasks like get quotes and make trades. The direct bank is also widely recognized for its excellent customer service and its progressive digital banking features.

It also offers a resource center with helpful content written in a more enjoyable way than most — think headlines like: “What Mutual Funds and Pizza Have in Common,” for instance.

Cost: Ally has also moved to charge zero commissions for stock and ETF trades. On options, it also charges no base commission, while its standard per-contract fees are now $0.50.

  • Cost per trade: $0
  • Minimum balance to open an account: $0

Merrill Edge: Best for integrated experience

With no minimum investment, Bank of America’s Merrill Edge is another good option for beginning investors— particularly if you’re a Bank of America bank customer.

Competitive edge: Merrill Edge is applauded for its integrated mobile experience that lets you make a credit card payment and place trades — assuming you’re a bank customer and investor. However, the app has been getting some poor reviews for its slow loading time.

Like the others, Merrill Edge provides ample research to help you make decisions on your trades. It also offers you more than 2,000 locations to meet with financial advisers, should you wish to have a face-to-face conversation.

Cost: Along with the industry, Merrill has cut its pricing, and now offers clients stock and ETF trades for free, down from $2.95. The base commission for options is also set at $0, though you’ll pay $0.65 per contract.

  • Cost per trade: $0
  • Minimum balance to open an account: $0

Other options

If you want a hands-off approach, you may also consider something like Betterment or Wealthfront.

Learn more: