One of the first and most important advantages of a discount broker is their lower commission cost. In most cases commissions are 50%-70% less then a full service broker. If you don’t have a lot of money to invest, these savings can be significant to your portfolio.

Discount brokers, however do not offer any kind of investment advice. You are simply on your own when it comes to making decision on stock purchases. This is a benefit since they are not steering you toward one stock over another. All they care about is that trade with them. Some more established discount brokers offer free research tools that can help you when making your trading decisions, others even offer free training courses on how to trade things such as stocks, options and even mutual funds.

Since discount brokers don’t provide advice, one downside is that they also don’t do anything to keep you from losing all your money. In most cases a discount broker is a buy and sell engine. If you risk all your money, no one is going to second guess that. In most cases, even though there are reduced trading commissions, there can be many hidden fees. Some can charge you to receive paper statements while others charge inactivity fees.

Another disadvantage to using an online broker is customer service. In most cases their customer service department is just there for issues and problems. In many cases you can be on hold for sometime when trying to solve an issue. Hand in hand with this is also their technology platform. There are many complaints out there where customers have complained that their trades lag for so long that they missed the price they were going for.

Like anything, you should make a pros and cons list of what you expect and need from a broker. Do the necessary research and search for reviews prior to signing up with anyone. If you are looking to open an account with a discount broker, you may consider the current Tradeking Promo. Usually this kind of Tradeking Bonus is the type of bonus you can expect when opening a new account. If you are going to start a relationship with a new broker, you may as well get some sort of incentive to do so.

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