Best Day Trading Brokers

In the opinion of Alexander Elder (Author of Trading for a living), day trading for a living is an exciting profession. You can trade several times a day in most markets while operating at any place of your choosing. It’s a job that comes with a great deal of autonomy.

But before you convert your living room into an office for day trading, you need to find the right broker to run your pattern day trades. As a day trader, you’re better off going for a discount broker to leverage both investment advisory and modern trading methods.

The alternative would be a full-service broker, but these traditional brokers typically have brick-and-mortar offices. They offer the customary brokering services and additional investment banking services such as financial planning at a fee. And this extra cost could be a problem, especially for beginner day traders.

Best Day Trading Brokers

You can sign-up with an unconventional full-service broker, but you’re better off joining a savvy discounted broker. What you have to do is find the ideal one. Look for a broker that charges low to zero commissions or trading fees.

Discounted brokers primarily offer their services through electronic means—trading platforms, both web-based and full-on day trading software (apps and personal computer (PC) programs).

So, they have lower overheads and can afford to facilitate the daily opening and closing of positions at nil commissions. Avoid brokers with extra fees such as account maintenance and low minimum account balance fees.

Make sure your ideal broker has a variety of accounts, including retirement, cash, margin, and discretionary (managed) accounts. You’ll have the upper hand if your day trading cash account doubles up as a checking account. If the broker is sophisticated, they may even offer mortgages and debit and credit cards.

Even more important is that the broker you choose has the best day-trading tools for market research and analysis. Speaking of research, a broker that provides securities scanners and trading languages or scripts for automated trades can up your day trading game. They should also have an array of securities to trade and access to international markets.

The day trading systems should be such that both automated and custom order placement and execution can occur at optimum levels. A subscription to the over the counter (OTC) market groups must be present or at least in the offing. If the broker can guarantee account security and reliable customer service, that would top up the deal.

Pick one of the day trading brokers below and start your wealth accumulation journey today.

TradeStation

You need as much as $500 to open an account with TradeStation. If the account happens to be an individual retirement account (IRA), the minimum opening balance surges to $5000. That’s quite expensive and could scare away potential day traders.

To retain clients, TradeStation provides real-time market scanners that users can tweak to suit their needs. Day traders working with this broker also have access to a treasure of historical data that comes in handy when placing trades off technical indicators and charts.

With TradeStation, you can trade initial public offers (IPOs), stocks, options, exchange-traded funds (ETFs), and other financial assets on PC or their trading app. You have the Portfolio Maestro tool for backtesting several day trading strategies concurrently. The TSgo trading plan allows you to day trade US equities (both listed and OTC) at $0 commissions.

LightSpeed

If you day trade mutual funds and forex, this broker isn’t for you. You can only trade equities, futures, and options. The avid options trader will love LightSpeed’s Livevol X, which is a free tool for analyzing options. The trading platform is stable, and reciprocation of data changes happens pretty fast. You can download a PC setup or trade on the mobile-optimized website and their other specialized trading software.

Day trading fees depend on the number of shares and ETFs you trade and the options or futures traded per contract. See the commission graduation scale below:

  • $0.0010 – Over 15,000,000 shares
  • $0.0015 – Over 6,000,000 shares
  • $0.0020 – Over 3,000,000 shares
  • $0.0025 – Over 1,000,000 shares
  • $0.0035 – Over 250,000 shares
  • $0.0045 – Under 249,999 shares**$1 minimum

The ETF per share volume tabulation happens at the end of every month. The minimum account opening balances are quite high at $25,000 for the Livevol X platform, $25,000 for Lightspeed Trader, and $10,000 for the Web Trader platform. The trading costs are low, though.

LightSpeed Broker accommodates the experienced day trader: the high-velocity professional stock and options trader who can route their orders. But newbies can also learn and get to this level.

TD Ameritrade

Close to 7 million clients use TD Ameritrade, and each day 650,000 trades are executed. The main assets to trade are stocks, futures, options, ETFs, and forex. Account minimums are at $0, but top-up limits are a minimum of $50 and above (up to $250,000 per deposit). Margin accounts require at least $2000 to open.

TD Ameritrade clients can trade on the web-based Trade Architect platform and PC with the Thinkorswim software. On these platforms, you can access portfolio planner tools, source answers from the in-built chatbot, place stock trade limits and orders, scan securities, and analyze charts.

TD Ameritrade offers extensive investor educational material on all their asset classes, which makes this broker a darling for novice day traders. The integration of social media handles for customer support eases the sharing of information (real-time quotes). The recent reduction of stock and ETF commissions to $0 makes this broker ideal for day traders.

Interactive Brokers

The standard Interactive Broker (IB) account alongside its modification (IBKR pro and lite), offer a superb trading experience at no cost for US exchange-listed stocks and ETFs. Both accounts also have $0 account minimums.

The Trader Workstation platform incorporates day trading algorithms, for instance, Adaptive Algo, that you can customize to fill your order price as per the bid and ask spread. You can also use the investor’s marketplace or the API provided to automate your day trading strategy.

Moreover, you have access to over 100 technical indicators to oversee your daily charting while harnessing the power of market scanners. High volume margin traders (around $100,000 worth of assets) enjoy very low day trading fees.

Brokers have one thing in common with the financial markets: they always adjust to market and trader trends. For example, TD Ameritrade scrubbed commissions on US-traded stocks and ETFs just recently in October of 2019. They also acquired Scottrade not too long ago. Such changes suggest dynamic shifts in competition among brokers, which favors day traders. Never hesitate to jump ship anytime you get the opportunity to join and day trade with a more satisfactory broker.

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