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| Stock Broker |
What is Stock Broker?
It doesn't make much of a difference which discount brokerage you use as long as you're picking your own stocks. Savage competition has forced virtually all the big players to offer some excellent services at good prices. If you aren't trading in and out of stocks very often (and you shouldn't be), and you're not too concerned about whether your trade is executed within 15 seconds or 2 minutes (and you shouldn't be), there really isn't a significant difference at all.
There are several reasons to choose a full-service broker over a discount or web broker. People use a full-service broker because they may not want to do their own research, because they are only interested in long-term investing, because they like to hear the broker's investment ideas, etc. But another important reason is that not everybody likes to trade. I may want retirement planning services from my broker. I may want to buy 3 or 4 mutual funds and have my broker worry about them. If my broker is a financial planner, perhaps I want tax or estate advice on certain investment options. Maybe I'm saving for my newborn child's education but I have no idea or desire to work out a plan to make sure the money is there when she or he needs it. A huge reason to stick with a full-service broker is access to initial public offerings (IPOs). These are generally reserved for the very best clients, where best is defined as "someone who generates lots of revenue," so someone who trades just a few times a year doesn't have a chance. But if you can afford to trade frequently at the full-service commission rates, you may be favored with access to some great IPOs.
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