2011 Kiplinger’s Best Online Brokers

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Every year Kiplinger’s magazine puts out a survey of the best online brokers. Every year, I take a look at the list because I’m curious how the different brokers stack up. I’d like to know if anyone has made any big changes or improvements to their service, it might change my mind about who I do business with.

Usually the lists don’t change all that much. As you scan this year’s list, you’ll see the same ones near the top, the same ones near the middle, and the same ones near the end. The meat is in the article detailing the different categories (like commissions and fees, investment choices, etc.) because it adds a little color to an otherwise robotic list.

One important thing to remember as you peruse this list: the best online broker is the broker that satisfies all of your requirements. All the bells and whistles in the world don’t matter if they don’t offer exactly what you need. With so many brokers, many of which are inexpensive, you should be able to find your best broker, online or offline, if you’re diligent.

Let’s get to the list…

2011 Best Online Brokers

Here’s the list along with their “comment:”

  1. Fidelity: Top-notch all around.
  2. TD Ameritrade: Tied for first place, with better investment choices than ever.
  3. E*Trade: Solid in all areas.
  4. Vanguard: Low costs and superb customer service set this broker apart.
  5. OptionsXpress: A Mecca for options buffs that scores high on costs.
  6. Charles Schwab: Offers the broadest list of funds with no loads or transaction fees.
  7. Scottrade: A better Web site would have boosted this broker’s ranking.
  8. TradeKing: The first broker to incorporate social networking.
  9. Firstrade: Could use additional tools and investment choices.
  10. Merrill Edge: This newcomer charges high fees.
  11. Zecco: Offers low costs but few investment choices.
  12. Just2Trade: Bare-bones broker boasts the lowest commissions.
  13. Muriel Siebert: Impressive range of investment choices; abysmal Web site.
  14. USAA: Costs are high, and Website and investment choices are lacking.

In the past, when we covered Kiplinger’s best discount brokers, they broke out discount and “regular” brokers. It’s hard to compare a broker like Vanguard against a discount broker like TradeKing (I use both but for different purposes) and expect a fair comparison. That’s why I recommend finding the best broker for you, rather than relying on lists.

Who is your favorite online broker and why?

{ 15 comments, please add your thoughts now! }

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15 Responses to “2011 Kiplinger’s Best Online Brokers”

  1. DIY Investor says:

    Interesting list. I have worked with several of these for my clients and the one I prefer is Charles Schwab for the simple reason that it is easy to select a model corresponding to your risk preference and to track your investments relative to the model. This is critical for investors trying to navigate today’s choppy market. IMHO Kiplinger’s ( which typically does super work) did not give this enough consideration.
    Furthermore Schwab is testing a performance measurement system for individuals – something investors are always asking about.
    For these reasons I would put Schwab higher on the list.

  2. Good to know! I currently have investments in Fidelity, so I’m glad to see them at the top of the list!

  3. I cannot argue with a list created by someone else, but ignoring Interactive Brokers, thinkorswim and tradeMONSTER tells me the list makers don’t much care about option traders.

    That’s what I would expect from Kiplingers. To them, owning mutual funds is all one needs to know about investing.

    IMHO, this list is worthless.

  4. cubiclegeoff says:

    Interesting to see USAA so low, considering they are so loved for most products and services, but this is an area where they are clearly lacking.

    • david says:

      Have been with USAA for years….great insurance operation….extremely poor financial arm. Tried to give them a break, but they lack adult leadership on the bank and investment side. So am researching a new discount broker….highly recommend any other discount broker over USAA….

  5. BrianC says:

    I’m in the process of moving my Roth IRA from Optionsxpress to Wells Fargo (you get 100 free trades per year if you have over 25K in assets). So far, my experience with Wells has been less than steller with a transfer process still not completed after two months (I’m sure this is atypical, with a number of delays on their end), but even if their platform turns out to be average I’ll be satisfied with what I’m saving on commissions.

    • govenar says:

      The Wells brokerage website is I’d say below average; very limited. But I put up with it for the free trades and the convenience of automatically pulling money from my checking account (which I already had at Wells) to settle trades.

  6. zapeta says:

    Without breaking our the discount brokers to consider separately, I don’t think this list is very useful. I have accounts at Fidelity and Vanguard, and also at TradeKing and Sharebuilder. I use each account for different purposes and I’m pleased with all of them. Fidelity and Vanguard handle my investments from my employer plan and Roth IRA. TradeKing and Sharebuilder I use for stock purchases but I split it up depending on the number of shares I want to transact.

  7. freeby50 says:

    I use Fidelity and Scottrade and my wife has a Schwab account. We’re happy with all 3 of those. I do agree Scottrades website could be improved, but otherwise they are great.

    I had an E*trade account years ago and their customer service was incompetent and dreadful.

  8. Craig says:

    Where’s ShareBuilder? I guess they don’t always have the lowest prices (depends on the plan) but I’ve been happy with them.

  9. I think I agree with their assessment on Scottrade. Scottrade’s website is always very quick and works well for the basics. It could definitely improve a number of its features though, such as tracking historical trades, etc. I love Scottrade, but they’re right, the website could use some help.

  10. eric says:

    I have Fidelity and Vanguard accounts but I don’t really do trading with those.

  11. david says:

    Despite the fact that USAA has excellent car insurance, it is a useless company when it comes to financials, whether it be banking or investments. Their fee structure for buying stock is GROSSLY too expensive, where you could easily find yourself paying 10 times more to buy an equity than at any of the top tier discount brokers. Also, the quality of their website is laughable. USAA claims that “they know what it means to serve”. However, you will find yourself on the phone constantly trying to correct problems. So I assume they believe that all the time they spend on the phone with you is what “it means to serve”. Will they correct problems? Yes. But doing business with them is like buying a new car at far more than its worth, then hoping to take it into the shop all the time for “FREE” maintenance….which, of course, is a ridiculous notion. If you do business with the USAA brokerage or bank, you will sorry…both is upfront costs and the hidden cost of time as you will have to constantly call them to sort out problems and concerns.

  12. jennifer says:

    Banc De Binary is the global leading financial services company. Their services are out of this world quality and what actually make them the best is their best customer service. They provide every kind of facility to contact them in case of any query. They made my life easy. Keep rocking Banc De Binary

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