Today I want to talk about brokers, commissions and platforms. Oh, my.
So that the number one question I always get asked from complete newbies, people who don’t even know what market they want to trade. They don’t even realize that there are different markets to trade is what the who what is the best broker and how much money should I have in my account?
You know what, the number one thing I tell you is, first of all, what market are you trading? Which market are you interested in trading?
In a lot of times they have no idea. So why would you go and open up a brokerage account where you’re going to put money in and not even know what market you’re going to trade?
Right. And the other thing is. Once you really understand what market you want to trade and there are four. I go much deeper into that for different markets. In another lesson, however, I’ll just give you a quick rundown.
And that’s futures stocks, options and forex. Once you figure out exactly which market you want to trade, then and only then you need to really understand how to read the market. Right.
So it’s like getting into a plane and having, you know, the whole dashboard in front of you and you’re having absolutely no idea what to press. It’s the exact same thing with day trading. Right.
So before you get to the broker, you need to know all of this. And that brings me to platforms. So if anything, we should reverse it, right?
We should first focus on platform. What platform is the best for day trading after you decide what you want to trade?
This way you learn how to read the market through the platform.
Your platform is like your dashboard in a plane, right?
You know exactly what buttons, where everything moves, what everything is doing right. So that’s if anything, we should reverse it and it should be what platform is the best for me?
So if you decide to go with stocks, sink or swim is one of the more popular platforms out there. It’s very intense and it’s a very in depth. And they give you free demos if you want to do futures. And Forex Ninja Trader is the best in that respect.
The source interface as far as usage. And again, it has a free demo. When I say free demo, that means you could attach a free demo to a live market feed and it’s paper money, right?
So this is the best way for you to learn now. Once you have actually learned, once you understand what the market is telling you. Once you feel confident enough that you are ready and you know exactly where you want to enter, where you want to exit.
What your risk management is now because you’re speaking about brokers. So when we talk about brokers, there are four things that I would like for you to focus on, and these will be the most significant. OK.
Because you are giving your money to them. You need to trust that your money is in good hands, that you’re working with the best. And that and one of them is going to be commissions.
So first, we’re gonna start with the most important part of what to look for in a broker. First and foremost, their reputation. How repeatable are they?
There are so many boutique brokers out there right now. So many. Right. Are they reputable? How do you know who they are? Do you have a track record?
There have been some instances, you know, that brokered companies just closed. So a my record and my recommendation to you in the beginning start with big brokers. Right.
Start with brokers that you know, that you’ve trust, that you’ve heard of that have, you know, have been around for a while. Even if they charge a teeny bit more than usual, stick with them. You know, there’s online brokers and then there are brokers that you can have one on one experiences with the people. The ones that help you, they always charge a lot more. Right.
So the commissions will be almost up to 25, even 50 dollars per trade. Don’t want to be there online. Like Ameritrade or E-Trade, they charge between seven dollars to ten dollars a trade. This is for stocks, right.
So this actually brings me to the second important thing, specialty. All right. So there are four markets out there to trade. So you wouldn’t go to you wouldn’t take your motorcycle to an automobile mechanic. Right. You would take your motorcycle to a motorcycle mechanic. It’s the same with trading. You want to take you want to go through the broker that specializes in your type of a market.
For instance, Ameritrade is excellent for stocks and options. However, they are not great for futures. Why?
They charge a lot more than, for instance, Ninja Trader, which is also a platform. And they also have a brokerage which only charges around four dollars a trade. Huge difference.
We’re talking 200 percent difference, right? Like Ameritrade charges eight dollars for futures round trip while the injured trader is four dollars. And think of it. Commissions will eat you up if you take a lot of trade. So this is something that you really want to focus on. Also, there are forex specialty brokers.
There are options, specialty brokers. So when you decide on the market, you’re ready to fully trade and know how to read the market. When you start to look for your broker or look for a specialty broker, OK. The ones that really specialize in that particular market. And then also definitely check their reputation. That is crucial.
That’s the third most important part, right? As commissions, you really, really wanna shop around for the best commissions. On top of the reputation. So look for the best commissions, for instance, scout trade and E-Trade. I think they charge like seven dollars per trade when it comes to stocks. Others can charge up to 10, 15 dollars. Right.
What’s the difference? Why are they charging differently? So you need to shop around. You need to understand for futures. I mentioned earlier, you know, you can go for dollars round trip or, you know, eight dollars round trip.
That’s a huge difference. Only to find out that before the other one is actually the ones I specialize most. So you need to really understand what your market is about, the reputation of your broker and the best commissions.
And the other really important, important, important part for day trading is if your broker is attached to the platform, everything you do will be from your platform. Right. Just go.
Let’s go back to the plane analogy. When you sit down at your dashboard, it’s right there. You don’t want to go into the other room, into the cabin to start the plane. Right.
So you don’t want to get off your platform to make your trade to put in the buy or sell order. You want it all right there from your platform. So this is very important.
There are many brokers that have platforms that you could do all of your trading right from the platform. So please find the best one when you are ready and make it as simple as possible, because day trading is not difficult. It is not. It is quite simple. And it starts with your platforms, your strategies and everything else. Once you have that simplified routine, you’ll be amazed how simple day trading could really be.
I teach beginner boot camp for day trading. I simplify the process, how to read the markets. We talk about the brokers. We talk about platforms. And if you don’t know this basic information, unfortunately, you will not be able to succeed as a day trader.
If you understand and have a foundation of the simple stuff the reading, the markets, understanding what markets you trade, what platform is best. You won’t be able to become a success, but it’s not difficult. It’s quite simple to understand all this. And I’m here to help. So please let me know how I get help. I’m here.
If you want to learn more about my journey and how I started day trading you can read it here or you can watch on my YouTube channel.
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So if you have any questions you can always ask me at thetraderchick.com and if you want to learn day trading basics – check out Day Trading Courses.