Choosing the right investment broker is a major decision that all traders have to make at some point. And as most important decisions in life, it’s definitely not an easy choice to make, and you really need to know what you’re looking for.
To help you make a decision that you can stick with, we’ve listed the best investment brokers right now as well as clear instructions on what to look for in a broker and which services to avoid.
Find the best trading platform. You capital is at risk when trading. Be careful.
An investment broker is a broker that one uses to place investments on an exchange or to buy derivatives based on instruments for a longer period of time. In many ways, the definition of an investment broker is the opposite of the definition of a day trading broker.
Traditionally, an investment broker was a person or a bank that worked on the exchange or in direct contact with it, but today the industry looks much different.
Nowadays, most brokers offer their services online. Because of this, this page will focus on the best investment brokers online.
Also, most regular banks offer brokerage services to people looking to invest in stocks and securities, but that doesn’t necessarily mean they have the best service. In fact, some of the biggest banks in the world offer subpar investment opportunities, especially compared to some of the top investment brokers today.
As mentioned, our goal for this page is to help you find an investment broker that suits you and your needs. In order to do so, we will start by explaining how investment brokers differ and what types of services they offer. Hopefully, this will help you make a better decision.
Investment Brokers and the Available Instruments
Before you can make your mind up about which broker you want to use, you have to decide which instruments you’re going to invest in. Stocks are the most common security for long-term investments, and in order for an investment broker to be considered one of the best, they need a solid selection of stocks.
However, there are plenty of other securities one can invest in long-term, for example, bonds, indices, commodity futures, and even cryptocurrencies. Therefore, we prefer to use and recommend brokers that offer as many instruments and asset classes as possible. In fact, many traders today want the ability to invest in different securities, so we look for brokers that offer a big variety of instruments. This is especially true for the best investment brokers for beginners since beginners usually haven’t made their minds up about which assets they want to trade.
We understand that figuring out where to start in the world of securities can be a daunting experience, so we thought we’d give you a quick run-down of some of the most popular assets and how they are traded. In most cases, you can divide assets into two groups: the ones that are traded on the exchange and the ones traded as derivatives.
From the Exchange
Securities traded from the exchange are traded in their “original” state, and this is the most common way to invest long-term. It’s also the most common way that the best investment brokers for beginners offer investment opportunities.
As mentioned, stocks are the most common security to trade in their original form and something most, if not all, the best investment brokers offer. Commodity futures, indices, and exchange-traded funds are other popular securities that are sold and traded directly on exchanges.
Lately, cryptocurrencies have become an increasingly popular instrument to invest in long-term, and more and more brokers are offering them. Just note that the cryptocurrencies and other assets are traded on different types of exchanges.
While stocks, futures, and bonds are traded on exchanges such as the NYSE and CBOE, cryptocurrencies are sold from an online exchange such as Binance and Coinbase.
As a Derivative
A derivative is an asset based on an underlying security, meaning you invest in the price of an asset without buying the actual security. One of the most popular derivatives to invest in today are CFDs, and even though they aren’t perfectly suited for long-term investments, many investment brokers are adding them to their selection.
Since CFDs are based on other securities, investment brokers can usually offer access to several markets at once. For example, the best investment brokers can have stocks, bonds, commodity futures and spots, cryptocurrencies, currency pairs, and much more on the same platform when using CFDs.
Some of the brokers that we’ve recommended below offer securities directly from the exchanges while others offer them as CFDs and it’s up to you to decide what you think suits you better. Just be aware that CFD trading, in most cases, is best suited for day trading and swing trading.
An Investment Broker’s Platforms and Tools
After you’ve decided on what securities you want to invest in you need to start looking for an investment platform that suits your needs. There are almost as many investment platforms as there are investment brokers and, in the end, you need to pick the one that fits you the best.
Obviously, the platform needs to be easy and smooth to use, but there is more to it than that. For example, in order to place the best investments and find lucrative opportunities, the platform needs to offer the charting tools and graphs that you need to analyze a range of securities.
If you’re not able to evaluate the securities you want to invest in and in which direction the price will most likely move, you can’t expect to make it very far as an investor.
In addition, you will want to have access to features like stop-loss to limit your losses as well as signals that can inform you when securities reach certain prices where you want to invest.
Lately, investment apps have become more advanced, and we would never recommend an investment broker that didn’t offer a top-shelf investment app. We also really like to find investment brokers that offer solid educational material, webinars, market updates, and other information that can help us become better as investors.
As you start trading and become more efficient in your strategies, you’ll figure out which features and tools you prefer to use which means that you might have to switch from one investment broker to a better investment broker in the future.
Investment Broker Fees and Safety
The last thing you need to do after you’ve found a market you want to invest in and a couple of investment brokers that you think would suit you is to compare their fee structures and evaluate their safety measures.
Safety and Regulated Investment Brokers
Finding a safe broker is not as hard as you might imagine. As long as you stick to our recommendations, you’ll be perfectly safe since we would never think of recommending a broker that wasn’t regulated and safe. In fact, the investment brokers listed on this page and all the other brokers recommended on this site are the top investment brokers in the world with millions of satisfied customers and all the necessary licenses.
Investment Broker Fees, Charges, and Costs
Fee structures, on the other hand, can be a bit more complicated to figure out. Every broker in the world needs to make money somehow which means they all charge fees in one way or another. The only exception is the American stock trading app Robinhood which has no fees but takes out interest on their customer’s funds instead.
Investment broker fees come in many shapes and have a range of different names, and you need to familiarize yourself with these terms. First and foremost, there are fees such as transaction fees, late fees, inactivity fees, etc. Some investment brokers also charge a commission for investments that you sell and some might take a small percentage of every position that you open.
Then there are the CFD brokers that charge something called spread. Spread, as you might already know, is the difference between the bid and the asking price and this is how most day trading brokers make a profit.
As if that wasn’t enough, brokers usually have different fees and charges for different securities, even if the securities are listed on the same exchange.
Because there are so many fees that a broker can charge customers for opening and closing positions, you need to combine all the charges and spread them out on a per trade basis. This is the only way to compare an investment broker’s fees with other brokers.
Generally speaking, the investment broker that offers the lowest cost per trade is better. Although, without the securities you want, a platform you feel comfortable with, and a safe service, the low fees don’t really matter.
List of the Best Investment Brokers
By now you’ve probably realized that finding the best investment broker is a balancing act where a multitude of different factors needs to work together to offer a superior product. Also, since several of the factors are based on personal preferences, a broker that we really like might not be a good match for you and vice versa.
Despite this, we have spent countless hours evaluating and testing investment brokers from all over Europe and the United States, and we’ve put together a top 3 list of the best investment brokers right now.
Here Are the Top Three Best Investment Brokers Right Now:
IG Group is a British financial firm that has been active since the mid-1970’s. Their main focus is spread betting and CFD trading for British and European traders, but they also offer one of the leading stock brokerages in the world. That means, IG Group can provide you with CFD trading solutions as well as long-term stock investment abilities at once, which is the reason why we consider them to be one of the leading investment brokers in the world.
As icing on the cake, IG Group also provides binary options trading in the United States via a broker called Nadex.
IG Group is listed on the London Stock Exchange and is a part of the FTSE 250, meaning it’s an incredibly influential institution in the UK. They also happen to offer outstanding trading and investment platforms.
Investment Opportunities: Stocks, CFDs, Forex, Spread Betting, and more
Fees: Fair in most cases and really cheap for certain assets
Read our IG Group Review
Find the best trading platform. You capital is at risk when trading. Be careful.
Other Types of Brokers for Specific Trading
This particular section of our site is aimed at long-term investments, but that’s only a small part of today’s massive investment industry and the brokers listed above are not the best for all types of trading.
In order to complement this guide, we’ve also reviewed and evaluated brokers for all other types of trading based on presets such as underlying assets, marketplaces, and geographical areas. Below are some of the most important guides and best trading brokers.
Best Investment Brokers UK
As a British trader, you’re probably not very interested in which American brokers are the best, and you might have a bigger interest in spread betting than others since it’s tax-free in the UK. Because of that, we’ve curated a list of the Best Investment Brokers UK where you can find all the UK based brokers that we recommend.