How to Find a Discount Broker for Your Investment Club     

If your investment club has decided that it’s in your best interests to use a discount broker you’ll need to know how to find one.

It won’t matter what discount broker that you decide to use so long as your club is being allowed to pick your own stocks.

There is a great deal of competition when it comes to discount brokers so you’ll be able to get some great deals in broker fees if you take the time to look for them.

Your investment club should delegate one or two members to find the best discount brokers that they can find, both on the Internet and locally.

There are a few things that you should keep in mind when you’re looking for a discount broker:

• Customer service that the broker offers
• Fees
• Other incentives to hire the broker

The fees that you have to pay the discount broker will generally be quite low. You’ll be able to see many discount brokers offering you their services both locally and on the Internet.

However, many times choosing the discount broker with the lowest fees means that you may be sacrificing some customer service for this lower fee.

You’ll have to decide if you want to trade low price for customer service.

If you’re thinking about hiring your discount broker from the Internet there are some things that you should keep in mind.

Online brokers generally fall into one of three groups:

 

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Very inexpensive. If your investment group is planning on doing a lot of buying and selling in the stock market you’ll want to think about using a very inexpensive broker for your transactions. Most of these inexpensive brokers charge anywhere from $4 to $12 per trade.

 

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Moderately priced. The mid range price that these brokers charge is anywhere from $12 to $20 per trade.

 

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Expensive. Brokers that charge a high fee per trade often offer you the best customer service so the price might be worth it to your investment club. You’ll have the opportunity to work with a broker that gives you great service. These brokers generally charge anywhere from $20 to $30 per trade.

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When you’re looking for a broker and basing your decision on customer service and the way the website operates you’ll want to take some time looking at the broker’s website.

You’ll want to make sure that the website is easy to use and easy to navigate.

You’ll want to know what type of customer service the broker offers. You’ll soon be able to make your decision about customer service after you conduct your first trade with the broker.

Make sure that you find out if there are any other incentives offered that make you want to hire the broker.

Other perks that an online broker may offer that can be of benefit to your investment club include:

• educational books and materials to buy at a discounted price or to read online.
• air miles for your air mile program
• free Internet access
• a discount on your first trade

Your investment club shouldn’t make its decision about what broker to use based on the extra incentives that are offered.

Take your time when deciding what broker you’re finally going to use. If it comes down to two or three brokers that have caught the attention of members of your investment group you’ll have to vote and have a majority ruling.

Always keep in mind that you can switch brokers at any time that you want if you’re not happy with the first broker that you’ve been working with.