Lets first start out with the different types of brokers and catagories they fall under. Then we will narrow down the selection process.

There are brokers that offer stock and options, brokers that offer futures, brokers that offer forex, and brokers that offer all of the above. They then fall into two catagories, which are online broker or web-based and direct access or software based.

With the web-based brokers you submitt you orders through your online account and the order goes to the broker who then submitts to the exchange and gets you filled.

With the direct access broker you bypass this part and are submitting your orders directly to the exchanges yourself with a direct access software platform. If you are new I recommend going with a web-based broker. Next I will list the best brokers in each category and tell a little about what they offer.

Web-based Brokers:

My #1 pick is OptionsXpress.com.

This is the broker I use and I highly recommend them. You can trade stocks, options, ETF's, Futures, Mutual Funds, and Bonds all from the same account. 1. Fraud Protection

2. SIPC member

3. No minimums for opening an account

4. User friendly website.

5. Tons of free investor education.

6. One on one coaching.

7. Stocks, options, ETF's, bonds, mutual funds, futures, all in one acct.

8. Free virtual trading account to test ideas and develop skills.

9. Outstanding customer service.

10. Advanced Orders

My #2 pick is ThinkorSwim.com.

Offers everything OptionsXpress does, but if you tend to trade options a little more actively you may want to consider these guys.

These two brokers are far superior to anyone else out there, such as the names you may have all heard of. Like etrade, TD Ameritrade, scottrade, all of which stink in my opinion.

Direct Access Brokers:

My #1 pick is Interactive Brokers.com.

They offer all products at the absolutely cheapest rates. The widest array of access to markets all around the world. However they cater only to serious traders and investors. Because of this the customer service department is known for what some would say is being rude. Really they just will not hold your hand and help, you must know what you are doing to trade here. This is where I do all of my active short-term trading, I use optionsxpress for my longer term plays and ira. The trader workstation platform is great for position management and order execution, but not so much for charting. I use a different program for charting. More on that in another hub.

My #2 pick is MB Trading.com.

They offer some really great rates as well, but they also offer the mbt navigator for free with no exchange fees. You could by the neoticker charting package which is a one time fee and it integrates right in with the mbt navigator. Now you have no monthly charting fees or exchange fees. Barron's rated them #1 in trade technology and execution.

Conclusion:

Don't just go with the one offering some current promo or who has the most advertising and they are the one you know about. Look at everything each one has to offer, then look at commissons and pricing.

If you are new, make sure they have a demo account you can practice with and some educational resources. OptionsXpress offers one on one coaching and it is well worth the money. Believe me the cost of ignorance is much higher.

If you dont trade very active don't pinch pennys on commissions and go with a lousy broker.

If you want to do this full time, please contact me first as I can save you the pain I went through to learn.