There are many brokerage houses that have taken advantage of the internet to offer their services to a bigger and more accessible market. The internet has become such a phenomenon that there is almost nothing that you cannot find online. While there are many brokerage services that offer the option of opening an online investing account not all are created equal. Some of them have a starting minimum deposit while others don’t like TD Ameritrade where you can open an account without a minimum deposit unless it is an IRA. However, initial deposits are not really what matters. What is really important is the service offered and what you can actually invest in through that account. This is where services really differ.
If you are thinking about opening an investment account to start your investing journey you should choose a reliable company that has gotten good reviews from professionals and that has good customer ratings. Remember that your money is what will be sitting on the account.
In my case, I invest trough TD Ameritrade because I am very happy with their service. The reason why I chose to stay with Td Ameritrade is because they offer a lot of options that are not limited only to stocks. Through their service you can invest in stocks, bonds mutual funds, ETFs and you can even trade currencies (FOREX) which makes the company one of the best in its class. You can really create portfolios that are very diversified through them. A diversified investment portfolio is a crucial part of any investing venture and is something that should not be neglected for any reason. Personally, I find that their fees are a little high compared to some competitors but the many options that are available easily overweight any difference in fees which to be honest are not that bad and sit at $10 per buy or sell order.
The company also provides many different options when it comes to retirement accounts and the list of mutual funds that are available is huge compared to those offered by other companies. The dividend reinvestment program is great since it allows partial shares to be bought automatically without incurring a fee. In other words, if you buy a dividend paying stock and you want dividends to be reinvested you do not incur in any fees. In addition, dividends can be used to buy partial shares allowing you to accumulate wealth even if you build a small investment portfolio. Other companies have this type of program but not all of them allow automatic reinvestment if the dividends are not sufficient to buy at least a whole share each time.
Note: I haven’t received any compensation from TD Ameritrade for writing this article. I like the company and what it offers and I do invest trough them. There are many companies out there that are also very good. Always chose a brokerage house that you feel comfortable and happy with.
Photo credit: Keerati.