When Should You Get a Full Service Stock Broker?

Traders can’t start trading after making complete trading systems. They need to pick the best stock brokers first. As a trader, you need to have the most outstanding expert on your side because you can’t afford to lose most of your investment cash.

Brokers come in two types. You can go for a full service broker for comprehensive help or for a discount broker for partial assistance. Obviously, a full service provider can give you so much more. This is the reason why a lot of investors opt for full service, thinking that this kind of service will result in better account handling. This may not always be necessarily true though. Don’t just choose a full service provider just because they seem to have more complete options. You need to carefully assess your real needs to make a good decision.

Getting a full service stock market broker can have some advantages. If you are an inexperienced trader or one who does not have time to perform trades, this will be a good choice for you. You can easily ask your service provider for advice before you decide on anything. They therefore function in a capacity that goes beyond placing trades. In a lot of cases, the pieces of advice that traders get are sensible and appropriate because they are based on good, solid investment trading research.

Because trading technical advice is highly sought after, getting full service seems the best stock broker option. The truth though is that it is only really a good idea if you don’t have a very stable system in place. If you do have a good trading system, you might be better off with discount stock brokers. If your trading system has been back tested and you are confident that it is reliable, then a full service broker can only make matters confusing for you. His inputs may clash or contradict with your system.

One other downside to a full service provider is the cost. Commissions can be set at more or less 1%-2%. Discount brokers may ask for only half this percentage because they don’t offer extra trading advice. This is one more good reason to settle for discount stock brokers.

In short, the best choice depends on factors that revolve specifically around your abilities and circumstances. A comprehensive services company can work to your advantage only if you feel that you need expert guidance. Otherwise, if you know what you are doing every time you trade, you would be better off with more affordable counterparts.

One piece of stock trading advice you should keep in mind regardless of the broker type you choose is to continually try to make your own trading system. Following a system is a good idea because this is the best way for you to control your risk levels and keep your losses at a comfortable minimum.