I am warming up to my idea of making a separate brokerage account for all of the free money I’ve gotten from banks, brokerages, and credit card companies. After some preliminary research, I’m leaning very heavily towards one broker – MB Trading, as they feature:
» $2,000 minimum to open.
» No minimum balance fees, no minimum commissions per month.
» Per-share stock commission of 1 cent per share up to 500 shares, and 1/2 cent per share over that. The minimum commission is $1. This means as long as you are trading less than 100 shares, you’re only paying $1 a trade!
No minimum fees, and limit/market trades starting at $1 works for me. I am just looking for a low-cost no-frills stock brokerage that is cheaper than my current I-Zone. This broker does charge a $35 annual fee for IRAs, and is also not good for mutual funds since they charge $50 a transaction for no-load funds. They also require you to download a Windows-only standalone application to trade from, or to telephone your trades in.
To fund an account, you can either wire the money, send them a check, do an ACH transfer, or make a broker-to-broker transfer. However, it looks like their ACH transfer capability is currently down. That’s not good. To withdraw, the only free way is to request a check by mail.
The other broker I am considering is the venerable Interactive Brokers (IB), which has been around much longer and many active traders use. IB is very similar to MB Trading, but it requires $10 in commissions a month. On the other hand, it does offer a browser-based trading interface.
Here are some good additional information sources I’ve been reading:
MB Trading Reviews and Interactive Broker Reviews at EliteTrader.com . (More from a daytrader point of view, also some reviews are a bit old)
Interactive Broker vs. MB Trading Part 1 & Part 2* at Fool.com (From a non-daytrader point of view)
I’ll most likely end up opening an account with MB Trading shortly, and put $2,000 in it to start investing aggressively in an ETF portfolio.
* Sign up for free Fool.com membership with a temporary spam e-mail, as they will send lots of marketing e-mail to you.
By Jonathan Ping | Investing | 12/26/05, 1:47pm