There are many online brokers out there to choose from, but only a handful of brokers actually cater to the day trader or the more active investor. When choosing the right day trading broker there is a variety of factors to consider.
Since many day traders often trade in and out of various stocks throughout the day, the commission rate is one of the biggest factors in choosing an online broker.
But if you are a day trader or a more active investor, you should also consider the broker’s trading platform, any platform fees, market data fees, and how fast a trade is executed.
The best day trading brokers will offer a good optimal mix of all of these. Lets take a look at some of the best stock brokers that are great for day traders.
THE BEST BROKERS FOR DAY TRADERS
SPEEDTRADER
SpeedTrader has a fast and efficient trading platform. SpeedTrader also offers free virtual trading account that allows customers to practice trading and test various strategies without risking real money. There are 3 trading platforms to choose from:
- SpeedTrader 2.0 (free) – browser-based direct access trading.
- SpeedTrader PRO is $49 per month (waived for clients who generate commissions equal to or greater than the total amount of fees that month). Powered by DAS, it delivers a full suite of trading tools with reliable, real-time market data, high-end performance, and a fully-customizable, streamlined design power the broad range of execution and management tools.
You can choose between a commission structure of a flat $6.95 per trade or $0.0039 per share with $0.99 minimum in pay-per-share commissions plan. The company has a $30 quarterly fee for those users making less than 15 trades per quarter. There are no surcharges on large orders, penny stocks and extended hours trading.
SpeedTrader – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $6.95 per trade or $.0039 per share | $1 | $49 per month (waived for customers that generate commissions equal to or greater than the total amount of fees that month) |
SURETRADER
Suretrader is one of the newer brokers. They offer a really good value, offering a commission for only $4.95 per trade.
What I like about SureTrader is that you don’t need 25k to day trade, you just need 2k. Since they are based in the Bahamas you don’t have to worry about the Pattern day trader (PDT) rule.
For those not familiar with the PDT rule, it is a rule in the USA that if you buy and sell the same stock or option on the same trading day four or more times within a period of five trading days, you will be considered a pattern day trader.
Day traders are required to maintain $25,000 equity in their brokerage account at all times. If the account equity falls below $25,000, a day trading minimum equity call will be issued on the account requiring them to deposit additional funds or securities.
So, basically with SureTrader you can avoid the PDT rule and trade with just $2,000, instead of the normal 25k that is required to day trade in the USA. Besides that they offer great tools for traders and they also offer a free paper trading account, which is great for new traders that want to get some experience and education.
Another great thing about SureTrader is that they offer a great opportunity for trading and short selling penny stocks with lesser fees than brokers based in the United States. Visit the SureTrader website to learn more about them.
SureTrader – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $4.95 per trade | $1 | $49/month |
TRADESTATION
TradeStation is another highly reputable broker that is popular among day traders and active traders. They offer a very good trading platform that ranks among the best in the industry each year.
You can choose between a per-share or flat-fee commission plans. There per-share commission rate is 1¢ per share up to 500 shares and then it is 0.6¢ per share thereafter. Or you can go with the flat-fee of $6.99 per trade.
TradeStation – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $6.99/trade or 1¢ per share up to 500 shares and then it is 0.6¢ per share thereafter | $1 | customers have to trade at least 5,000 shares or 50 options contracts a month to avoid $59.95 monthly fee for using TradeStation Platform |
LIGHTSPEED TRADING
Lightspeed is one of my favorite online stock brokers that is mostly geared towards day traders and active traders.
What I like about them is there clean and simple trading platform. Also, they offer great tools along with some of the lowest commissions in the industry. There are no account maintenance fees, no order cancellation fees and no ticket charges.
They offer two platforms: Lightspeed Trader (min. $10K equity) and a Lightspeed Web version (min. $2K equity). On top of that, you can use the trading platform of your choice. You are also able to link up eSignal with your account.
Lightspeed – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $4.50 per trade or $.0045 per share | $0.60 | none |
INTERACTIVE BROKERS
Interactive Brokers is geared more towards day traders and is among the most popular day trading broker. They are considered to have one of the best professional trading platforms in the industry and among the best for execution.
Their platform is a fully customizable platform, with cutting-edge charting and research services, dynamic streaming quotes, tools for risk management, and the ability to place orders that go directly to the market.
The downside of having such a powerful professional trading platform is that it’s hard to learn and not intuitive. It can be especially difficult to master for beginner traders.
Their commission rate is pay-per-share, where customers pay $0.005 per share, with $1 minimum per order and no maximum.
Interactive Brokers has no surcharges on penny stock and they have good borrows for shorting penny stocks, even penny stocks that that trade OTCBB/Pink Sheets.
Interactive Brokers – Standard Commissions
| Stock Trades | Options Per Contract | Platform & Market Data fees |
| $0.005 per share | $0.70 | $10/month for IB market data feed (waived if trade commissions are more than $30/month) |
MB TRADING
MB Trading offers a good trading platform with many bells and whistles one would expect from professional trading software. Barron’s has consistently ranked MB Trading near the top for trading technology.
MB Trading has some of the best charting among online day trading brokers. Their commission structure is either $4.95 per trade or 0.0075 per share with a $4.95 min per trade. MB Trading doesn’t have penny stock surcharges, but it does charge additional $0.005 per share for extended hours trading
MB Trading – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $4.95 per trade or $0.0075 per share with a $4.95 minimum per trade | $0.95 | none |
NOBLETRADING
NobleTrading is a division of LightSpeed Trading and they offer the LightSpeed Trading platform for free. You can also use a variety of other platforms with them. NobleTrading will accept traders from other countries, and accounts can be maintained in non US currencies.
They offer two main commission structures: either $7.95 per trade or 0.008 per share with a $3.95 min per trade. They also offer a name your own price commission plan for accounts with a balance over $30,000.
NobleTrading – Standard Commissions
| Stock Trades | Options Per Contract | Platform Fees |
| $7.95 per trade or $.008 per share | $1 | none |
TRADEMONSTER
tradeMONSTER offers an excellent trading platform for both active option & stock traders that can easily be customized. Also, they offer a virtual trading account (paper trading account), which is immediately funded with $100,000 of virtual money and customers can start practicing trading and playing with trading tools right away.
TradeMonster’s commission rate is a flat $7.50 per trade. They have no platform, maintenance or hidden fees. For penny stock trades, TradeMonster adds $0.0005 per share on the entire order for any stocks priced less than $1.00. This is in addition to the standard commission of $7.50 per trade. For example, the commission rate of buying 1000 shares for a stock trading at $1 per share would be $8.00
TradeMonster – Standard Commissions
| Stock Trades | Options Per Contract | Min. Account Deposit |
| $7.50 per trade | $.50 | $2000 |
THE BOTTOM LINE
The broker you end up choosing is based on your personal preference. I can not recommend one stock broker over another. Many of the online brokers offer you the ability to test out their trading platform for free, so the best advice I can give is test out their trading platform and research a little more on the broker.
Once you have chosen one of the day trading brokers that best suits you and opened an account, knowing how trade stocks is one thing but knowing the best stocks to trade is another.
You can’t just go off and start trading random stocks and hoping you’ll make money. The point is, whenever trading stocks, you must get educated, have a trading strategy and have the proper risk management in place.
