| While
I do not plan to talk about investing and financial planning
here but if you are still trading through a broker you need
to switch to a online trading for one simple reason:
your broker never has the patience and the time to give you
all the information that you need to make a judgment about
what stocks to invest in, when, and if you should get out.
(Related:
Personal finance for empty nesters) What's wrong with your broker?
- She or he is just too busy and even
though he charges more for a trade, there is no way she
or he can really dedicate all the
 time to give you the
advice that you need.
- More often than not your broker is not
around when you need to get in or out of a stock
fast. By the way, a broker can only talk to one
person at a time.
- While a broker has access to all the data
that you need to look at, he will never share that with
you for two reasons (1) doesn't have the time (2) you will
probably fire your broker once you know that you could
make better decisions yourself if you had the data.
How does online trading help you?
- It is inexpensive and actually a greater
value for your money.
- You get access to data that you don't get
otherwise (yes, you can get some data from a financial
website like MoneyCentral, Wall Street Journal, CNBC,
Bloomberg, etc. but it is old and incomplete).
(Related:
Online shopping safety)
- No matter where you are and what time it
is you can access your account as long as you have access
to the Internet (and now several online trading firms
provide voice activated telephone access so that you can
trade by speaking into a phone without the help of an
operator).
How to pick an online trading brokerage
firm?
- Unless you plan on becoming a day trader,
do not just look at the commission for a trade.
Sometimes for a dollar or two you will see significant
drop in customer service.
- Make sure that you sign up for Level II
quotes and real time streaming news. If you are not
a heavy user, it might cost you about $10 a month but it
is worth it. When money is at stake, every piece of
data counts. So when you do decide to make a trade,
you will have all the information you need on one screen
and you can execute a trade when you want it.
- Stick to one of the reputed firms (e.g.
Ameritrade Apex, TD Waterhouse, Scot Trade, Brown Co,
Fidelity, Harris Direct, etc.)
Recommended links: Tips
on guaranteed retirement income
Americans
need retirement help Teach
kids about money |
