Ready to Trade Stocks: Some of The Best Online Brokers of 2020

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While the markets are anything but certain, how many of us have still thought "I'd sure like to buy shares of Netflix (NFLX) stock right now.", or Peloton (PTON) or Amazon (AMZN)? I know I have. The first step in online trading is establishing an online brokerage account, an investment account you can use to buy stocks, bonds, mutual funds and other investments.

You generally do not need a lot of money to open a brokerage account — many brokerage firms will allow you to open an account quickly online with no initial deposit.

You may be wondering "how much money do I need to start?", and the answer is surprisingly... not much. You generally do not need a lot of money to open a brokerage account — many brokerage firms will allow you to open an account quickly online with no initial deposit and there should be no fees for opening the account.

You will need to fund the account before purchasing investments. You can fund the brokerage account by transferring money from your checking or savings account, a process that takes a few days to a week. You can also transfer money from one brokerage account to another if you decide to change brokerage firms. There is no limit on the number of brokerage accounts you can have, or the amount of money you can deposit into a taxable brokerage account each year. 

We found some of the top options of 2020 for all levels of traders. 

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Interactive Brokers IBKR Lite

Interactive Brokers has long been a popular broker for advanced traders, but in 2019 the company launched a second tier of service — IBKR Lite — for more casual investors.

With IBKR Lite, you get unlimited free trades of stocks and exchange-traded funds that are listed on U.S. exchanges. If you're interested in trading other investments, including options, futures, mutual funds, fixed income and more, you can do that on 125 markets in 31 countries with a Lite account, but the trading costs will be the same as what IBKR Pro investors pay.

As the name implies, IBKR Pro is geared toward advanced traders. If that's you, you'll probably like the broker's per-share pricing of $0.005 per share (the minimum is $1), advanced trading platform, unmatched range of tradable securities — including foreign stocks — and ridiculously low margin rates.

Both tiers of service have a $0 account minimum and offer fractional shares of stock. IBKR Lite has no account maintenance or inactivity fees. IBKR Pro charges an inactivity fee, though it's possible to skirt that if you trade relatively frequently.

Interactive Brokers is best for:

  • Casual and advanced traders.

  • Day traders.

  • Margin accounts.

  • Options trading.
  • Research and data.
 

Firstrade

Firstrade appeals to experienced investors with $0 trading costs and no per-contract fees for options trades, while beginning investors will appreciate its $0 account minimum to begin investing. Investors looking for long-term investments enjoy commission-free trades for all mutual funds.

With three trading platforms and a recently redesigned mobile app, Firstrade offers a strong brokerage experience whether you are a day trader or a retirement investor looking to open an IRA.

Firstrade is best for:

  • Beginning investors.

  • Mutual fund investors.

  • Options traders.

  • Free commissions.

  • Native Chinese speakers.

The historic Wall Street in New York York City.

Robinhood

Robinhood is a free-trading app that lets investors trade stocks, options, exchange-traded funds and cryptocurrency without paying commissions or fees. Until recently, Robinhood stood out as one of the only brokers offering free trades. But with many big-name online brokers eliminating trading commissions and fees in late 2019, Robinhood's bright light has dimmed a little. That said, it's still a solid choice, and currently it's one of the few brokers that gives investors the opportunity to trade cryptocurrency.

Robinhood offers both web and mobile trading, but the platforms are purposely bare bones, and some investors may find the range of tradable securities and account options lacking.

» Want help managing your investments? See our top robo-advisors.

Robinhood is best for:

  • Mobile users.

  • Individual taxable accounts.

  • Margin accounts.

  • Cryptocurrency.

TradeStation


TradeStation is a top-notch choice for serious investors seeking a truly professional-level trading experience. In fact, at one time TradeStation catered solely to professional brokers and money managers. Now, regular investors have access to the firm’s high-octane tools, especially after the company recently cut trading costs to $0 and lowered the minimum investment to $0 for its new TS GO offering.

Less attractive to new investors will be the broker's upgraded TS Select plan, which requires a $2,000 initial investment but gives access to the broker's full suite of tools, and free trades from the powerful TradeStation 10 Desktop platform.

TradeStation is best for:

  • Advanced and active traders.

  • Stock, options and futures traders.
  • Cryptocurrency trading.
Regardless of the level of trading experience you have, there are several choices for you out there. Now may be the time to start exploring your options (no pun intended). 

 

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