Kiplinger’s Personal Finance just recently published their November rankings on the best online brokers, judging each brokers by their tools, commission cost (based on accounts with $50,000), investment choices, ease of use, and customer service.

Here’s the list of best online discount brokers, ranked by best to worst:

Online Broker Commission Cost Research and Tools Commission and Fees Investment Choices Ease of Use Customer Service
Fidelity $10.95 5 / 5 2 / 5 5 / 5 5 / 5 4 / 5
Charles Schwab $12.95 5 / 5 1/ 5 5 / 5 3 / 5 3 / 5
Muriel Siebert $14.95 3 / 5 3 / 5 4 / 5 4 / 5 3 / 5
TradeKing $4.95 3 / 5 3 / 5 3 / 5 1 / 5 5 / 5
E*TRADE $9.99 4 / 5 2 / 5 4 / 5 4 / 5 1 / 5
Optionshouse $4.95 2 / 5 5 / 5 2 / 5 2 / 5 4 / 5
TD Ameritrade $9.88 3 / 5 1 / 5 1 / 5 3 / 5 5 / 5
WellsTrade 100 free per year 2 / 5 4 / 5 2 / 5 3 / 5 2 / 5
Firstrade $6.95 1 / 5 4 / 5 3 / 5 2 / 5 2 / 5
OptionsXpress $14.95 2 / 5 2 / 5 3 / 5 2 / 5 1 / 5
Zecco 10 free per month 1 / 5 4 / 5 1 / 5 1 / 5 3 / 5
Scottrade $7 1 / 5 3 / 5 3 / 5 2 / 5 1 / 5

Your choice of brokers will really depend on how comfortable you are with certain aspect of investing.  For example, if you like to manually crunch your own numbers to spit out Schedule D, then you wouldn’t need any special tax tools from your discount broker. On the other hand, if calculating your cost basis gives you headache, then you may want brokers will more involved tools.

Kiplinger also judged each broker on ease of use, and I was actually surprised that Fidelity got 5 out of 5 stars, as I find the interface requiring a bit of digging, but maybe that’s just me. It was no surprise though for TradeKing to receive 5 out of 5 stars for customer service, as TradeKing always promptly respond to any of my questions regarding trades (even when I made the mistakes myself – hah).

As for the other discount broker on the list that I also use, Zecco’s rating was pretty spot on. However, depending on your investment requirements, Zecco’s low cost can be a good choice.

At the end though, I believe most people will have multiple accounts at various discount brokers. Usually a central location for their IRA, 401k, and other supplement accounts for making various type of individual stock trades and options speculations (hah).

Related Links:

  • TradeKing – SmartMoney #1 Discount Broker
  • E*Trade – 100 Commission Free Trade
  • Zecco – $4.50 per trade plus 10 free trade per month*