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Best Brokers for Beginners in 2021

The number of new traders and the brokers that cater to their needs keep on piling each day. Understanding the tree of the financial industry and its branches is complicated, where brokerages differ by a considerable margin in terms of services and features. The novices are confused by the process of finding the best brokers for beginners. To help clear the unnecessary noise, we have handpicked the best ones that will ease the initial stages of your trading journey.

Advantages of Using the Best Brokers for Beginners

The following benefits are available when trading with the best brokers for beginners:

  • Top regulators keep these companies under check, which makes them the first choice among many. You can complain to the authorities who may recover your money and fine or ban such brokers in case of fraud or mishap.
  • They have an astonishing amount of educational material and market research on their website. It is beneficial for beginners as having proper knowledge of the financial industry can help them be consistently profitable in a short period.
  • The fees and costs are low. There are usually no deposit and withdrawal charges.
  • Minimum deposit amount for forex brokers is as low as 5$ in some cases, whereas stock brokerage may start from 200$. Such low funding options allow one to test the real markets with absolutely no risk at all.
  • The trading platform is quite easy to use. There is a guide for accessing every useful portion of the web-based portal or computer software to help you learn quickly.
  • Opening an account is simple and quick. Some online brokers allow you to get in the markets in a minimum of two to three minutes.
  • Excellent customer support is always online to solve any issues. Live chat, email, and telephone are the main routes to connect to their service. They address all of your problems in a timely fashion with utmost priority.
1
Min. Deposit
$50
Exclusive promotion
User Score
10
Trade/invest in stocks with just $50
Invest for dividends and get payout on stocks on Ex-Dividend day
Over 11 payment methods, including PayPal
Start Trading
Pros:
Trade/invest in stocks with just $50
Invest for dividends and get payout on stocks on Ex-Dividend day
Over 11 payment methods, including PayPal
Payment Methods
Bank Transfer, Wire Transfer
Full regulations list:
CySEC, FCA
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro. Your capital is at risk.
2
Min. Deposit
$1
Exclusive promotion
User Score
9.3
0 Commissions and no deposit minimums
Registered with and regulated by SEC and FINRA
Loss of cash protection
Start Trading
Pros:
0 Commissions and no deposit minimums
Registered with and regulated by SEC and FINRA
Loss of cash protection
Payment Methods
Full regulations list:

What is a broker?

Many people who are captivated by financial markets’ have to find ways to carry out their executions. Brokers are companies or exchanges that offer traders the opportunity to buy or sell assets or currencies through their platform. In return, the brokerage firm charges a fee or commission, which is usually a small number.

The industry is made up of buyers and sellers responsible for carrying an asset’s price both ways. One can trade both ways, long or short, depending on the kind of setup he has. 

Beginner-friendly brokers make it easier for newbies to invest in stocks or forex and execute their positions.

3 Ways you Can Benefit from the Best Brokers for Beginners

The best brokers for beginners have the following benefits for traders:

  • Education: The companies that have their facilities catered towards newbies have the best education material on their website. The right knowledge is essential to keep one alive in the fight between bulls and bears and 10% of traders who win. 
  • Account type:  Traders can benefit from the different account types with various low deposit amounts, fees, and execution speeds. Traders can get a taste of live trading by using micro accounts in forex and funding it with the minimum possible amount.   
  • Regulation: Top tier authorities always regulate the best brokers for beginners. Trading with a company that comes under the strict supervision of regulators will ensure that you get the best services.

Our picks for the best broker for Beginners

The best brokers for beginners are listed below:

  • XM
  • IG
  • TD Ameritrade
  • Robinhood
  • Interactive Brokers
  • eToro

Top tier authorities regulate all the brokers shown above. They have various deposit and withdrawal methods along with low fees and commissions for their traders. A lot of good educational material and market research is available on the website to help novices get on their feet. 

It will only take a few minutes for you to open an account, after which you’ll be taken to one of the best user-friendly platforms in the industry. Customer services are a top priority for the best brokers for beginners, where most of them offer 24/7 support through live chat, email, and phone. 

How do the best brokers for beginners work?

Brokers connect traders to the exchange, whether it’s stocks or currency, so that they can carry out their trades. Nowadays, you are able to perform executions from the comfort of your home. 

The brokerage charges a fixed amount of commission or has its fees built into the spreads. For example, a broker who takes profits from the spread will keep a difference between the bid and the asking price. When you open a trade, it will be negative, which resembles the company’s fee. On the other hand, you may be billed a fixed amount of, let’s say, 10$ per thousand shares.

3 Steps to start trading with the best broker for beginners?

1

Opening a trading account:

Click on the register button, and you’ll land at the sign-up page. You can quickly get in with a broker by setting up your email address and password. A confirmation email may be sent in some cases for account verification purposes.

2

Making a deposit

There are many ways to fund your trading account, including wire/bank transfer, credit/debit, card, e-wallets, local transfer, and more. Depending on your deposit method, it may take some time for the money to show up in your account.

3

Start trading

As soon as your deposit is confirmed, you can begin trading. Set up your preferred withdrawal methods and place your positions whenever the right setup comes in place.

Disadvantages of Using the Best Brokers for Beginners

While it may seem a bit absurd, the best brokers for beginners do have some demerits. Here are some of the disadvantages:

  • The charting tools, such as indicators, lines, etc are simple and few. Some traders may not be able to implement their strategies.
  • Different account types may confuse a few traders. 
  • Beginners may get caught in attractive bonuses and promotions designed to lure them in by brokers. These offers are usually detrimental as they hold no value. For, e.g., no deposit bonuses may result in margin calls as a novice trader may confuse his equity.
  • They may not allow residents of some countries due to restrictions by regulators.

Expert tip on selecting Best Broker for Beginners

Regulation is one of the critical factors to look out for when choosing a broker. Trading under a regulated company will ensure that your money is safe. In case of any mischief by your brokerage, you can report to the regulatory authorities, who may impose hefty fines. Brokers are also expected to disclose risk to traders and increase their awareness about markets by coming under top tier regulatory authorities.
- Shams Ul Zoha

How to choose the best broker for beginners?

Choosing the best brokerage may be looked upon as a tedious task by some. In reality, the whole process is simple and only consists of scrutinizing a few factors to name. This section will outline all important factors such as regulation, fees, education, and more that are important for selecting the best broker for beginners. 

Is the broker regulated?

Top brokers are always under strict check and balance by regulatory authorities. A regulated brokerage will make sure to provide the best to its customers as any problem on their part may result in fines and a permanent ban.

What fees and charges apply?

Keep an eye out for commissions and fees, as they may eat all your profits. Look for low-cost brokers with no deposit and withdrawal charges. The spreads should also be as low as possible.

What payment methods are accepted?

A wide variety of payment methods are beneficial on traders’ end. Funding options such as bank/wire transfer, e-wallets, and credit/debit cards are the first choice of many.

What are the available assets to trade?

The broker should have the asset that you trade. More instruments are always preferred. Some companies allow you to trade stocks and currencies on their platforms.

Is there a demo account?

A demo account can help beginners and professionals test out new strategies and analyze the current ones with various risk management settings. In the initial stages of trading, novices can use virtual portfolios to get a taste of trading.

What is the account minimum?

A minimum amount of deposit allows beginners to trade with the lowest possible risk. Keeping your bet amount on the small side will limit losses at the point where most traders fail and quit.

What educational resources are available?

Keep a lookout for the educational resources as they can help you by leaps and bounds. Such materials allow you to increase your learning curve and be in the upper rank quickly.

Is there help and support available?

Customer services should answer all of your inquiries and questions. Quick support via live chat, phone, or email must be at your disposal 24/7.

Is there a mobile platform or app?

Mobile apps can enable you to trade and manage current positions on the go. It is incredibly beneficial in case you have to leave your home urgently.

Frequently Asked Questions

  1. eToro has the lowest fees on stock, while IG has minimum charges in forex.

  2. XM is the best broker for beginners.

  3. Trading tools such as indicators, trend lines, Fibonacci, zones, EA, and stock screeners are available.

  4. It takes only a few minutes to open a trading account. Some brokers may want to verify your identity, in which case it may take some days.

  5. The best broker for beginners makes money by commissions and spreads.

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