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The best stock trading apps allow you to buy and sell a variety of investments for free right from your phone or laptop.
In this article, I’ll explain whether a self-directed trading app is the best choice for you. I’ll also help you navigate the overwhelming number of choices by identifying the best brokerage companies.
Not long ago, self-directed investment involved paying a discount broker like Schwab, Fidelity or TD Ameritrade to execute your buy and sell orders.
Then Robinhood launched with free trades. Soon after, competitive pressure caused many of the discount brokers to become free brokers. As such, in compiling the best stock trading apps, I made $0 trades a requirement. If you’re a self-directed investor, you can make free stock, ETF and options trades with plenty of reputable brokers in 2022.
The biggest differences in today’s stock trading and investment apps relate to minimum deposit requirements, ease of use, research, tools and access. The product offerings among the best free stock trading apps can vary wildly.
Originally, the term “discount broker” was associated with companies that disrupted the industry leaders. The Schwabs of the world made it possible for the average retail investor to access the stock market without paying exorbitant fees or commissions and without having to maintain high minimum balances.
More recently, fintech companies have been disrupting those original disruptors. While discount brokers still exist, the best discount brokers are now free.
There’s been almost constant change in the industry in the last few years, so it’s a good idea to make sure you get the most up-to-date information about the stock trading app you’re interested in using.
Company | Best For | Why It Makes Our List |
---|---|---|
Fidelity | Overall | Tremendous overall cost structure, strong tools, good research data |
Interactive Brokers | International markets | Best selection of international investment options |
Robinhood | Beginners | Simplest, fastest app, low costs, fractional shares |
Schwab | ETFs | Great screening tools and low costs especially for ETFs |
TD Ameritrade | Tools and research | Educational content, research, tools and platform among the best |
Vanguard | Passive Investors | Low-cost mutual funds and ETFs |
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs, options | $0 | Stocks, ETFs, Options, Mutual funds, CDs, Metals | Taxable, Retirement, HSA, Trust | Yes | 4.2 | 4.8 |
The Details: Fidelity offers an exceedingly rare combination of low costs and strong features that makes it ideal for any level of investor.
It’s easy to look at how many of the best stock trading apps offer $0 commissions and assume they’re all equal on price. But you’d be hard-pressed to find a self-directed investment platform with better overall rates than Fidelity.
Fidelity says it doesn’t profit by selling your buy or sell orders to third party companies. As such, customers get the best prices on order execution. Fidelity offers lots of zero expense ratio mutual funds, and more than 3,400 of them carry no transaction fees.
Despite those rock-bottom prices, Fidelity provides what is perhaps the best research information of any stock trading and investment app. On its site, you can find reports on stocks from 20 different third-party research firms. The company’s in-house market analysis, Fidelity Viewpoints, also draws rave reviews. Add to that an easy-to-use, detailed stock screener with options galore.
But wait. There’s more: Fidelity offers educational opportunities via free in-person help and investor seminars as well as a robust online learning center.
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs | $0 | Stocks, ETFs, Options, Mutual funds, Bonds, Metals, Futures | Taxable, Retirement, Trust | Yes | 4.2 | 2.9 |
The Details: If you want to trade around the world and around the clock, Interactive Brokers may be the best stock trading app for you that’s based in the United States.
With access to 135 international markets in more than 30 countries using 25 currencies, including stocks, options, futures and bonds, Interactive Brokers offers what is probably the biggest selection of international investment opportunities. You can also invest in more than 8,300 mutual funds without paying any transaction fees (and more than 45,000 mutual funds overall). If you’re researching mutual funds, the company will recommend similar ETFs, which cost less.
Interactive Brokers also is one of the best platforms in the industry in terms of order execution, actively helping you secure the best possible price on your trades.
The company’s entry-level investment plan, “IBKR Lite,” offers free trades on domestic stocks and ETFs. It also allows you to trade fractional shares and carries a $0 account minimum. So Interactive Brokers is competitive with the other companies on this list based on price.
If you’re using it just to make free trades on U.S.-based stocks, there are probably platforms that offer you better features. But if you’d like to sprinkle in exposure to a wide variety of international markets at an inexpensive cost — and then hold those stocks for a long time — it’s a good option.
That said, Interactive Brokers seems targeted to professional investors. Its IBKR Pro plan is set up for professionals who want to trade on the international market. Whether you are a Lite or Pro customer, you’ll pay $0.005 per share on international trades (minimum of $1 per trade). Rates can go even lower for high-volume traders.
The pricing structure for the Pro plan is complex, although for individuals making these sorts of international trades, it’s well-respected and considered a great value.
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs, options | $0 | Stocks, ETFs, Options, Crypto, Metals | Taxable | Yes | 3.8 | 4.2 |
The Details: Robinhood’s app is the simplest, fastest and easiest to use of any investment platform I’ve reviewed. It doesn’t include as much in the way of charts and research. But if you’re a new investor, you may not be looking for that kind of information anyway. Robinhood gives you enough information to learn the basics of investing and then execute trades easily — without getting bogged down by data you may not understand.
Thoughtful Robinhood users will find outside sources for research and analysis and use the app mainly to track their portfolios and execute free trades.
Robinhood is at least indirectly responsible for all of the investment apps that offer $0 commissions on stocks and ETFs. The company has followed the “move fast and break things” ethos of Silicon Valley, disrupting the discount brokerage industry and drawing headlines for a mix of innovation and controversy.
Robinhood lets you trade fractional shares, so even if you don’t have much capital, you can develop a well-diversified portfolio. It supports cryptocurrency trading too. So if you want to, you can dip your toe into the crypto-trading world by buying as little as $1 in Bitcoin. (Money expert Clark Howard does not recommend investing in cryptocurrencies.)
Robinhood makes everything as easy and fast as possible. For example, when you sign up with Robinhood, up to $1,000 of your deposits are instantly available for trading, even before the transfer is finalized.
Robinhood also offers a cash management account. It earns 1% APY as of May 2022.
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs, options | $0 | Stocks, ETFs, Options, Mutual funds, Bonds, CDs, Metals, Futures | Taxable, Retirement, HSA Trust | Yes | 3.8 | 4.8 |
The Details: Although its website (and recent industry media coverage) may lead you to believe Schwab is pushing you toward its full service or robo-advisor, self-directed investors still have a place at this legacy brokerage.
The company underwent major changes in the last few years, slashing fees and acquiring TD Ameritrade in a merger that should be complete sometime in 2023.
Especially if you download its proprietary StreetSmart Edge software, Schwab may be the best place to invest in ETFs, which is a popular low-expense, well-diversified long-term strategy. StreetSmart Edge offers more than 150 screening options for ETFs. It’s a sophisticated tool that’s available to you even if you aren’t a Schwab customer. Schwab also lets you research stocks, ETFs and mutual funds simultaneously. Overall, Schwab’s research and investment tools are some of the best in the industry.
The company gives customers access to its own proprietary index funds and ETFs and offers more than 500 funds with an expense ratio of 0.50% or less.
Schwab also offers fractional shares, but they’re somewhat limited. Called Schwab Stock Slices, the minimum investment is $5, you can buy no more than 10 slices at a time and the offerings are limited to the S&P 500.
You’ll make just 0.05% APY on your uninvested cash at Schwab, which is low. Still, one reason Schwab was able to move to $0 commissions is that it makes a large percentage of its revenue on uninvested cash from its customers.
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs, options | $100 | Stocks, ETFs, Options, Mutual funds, CDs, Bonds, Metals, Futures | Taxable, Retirement, HSA Trust | No | 3.6 | 4.5 |
The Details: Schwab has acquired TD Ameritrade and will reportedly integrate TD Ameritrade into its operations by the end of 2023. But there’s an argument to be made that, in its present form, TD Ameritrade is the best stock trading app in 2022.
TD Ameritrade doesn’t offer fractional shares, which is one of its few negatives. Its website is the opposite of the Robinhood experience, which contains scant information but is easy to navigate. TD Ameritrade gives customers such a burst of educational content (including its own media network), research and investment tools that it can be challenging to wade through the forest of features to find what you want.
The platform is well-rounded enough to deliver a good product for day traders, futures traders and options traders. But it doesn’t specialize. As long as you stick to basic investing strategies, TD Ameritrade should be able to meet your needs.
Its desktop platform, called “thinkorswim,” is among the best you’ll find for charts and real-time data. It’s as customizable and feature-rich as any investment platform that offers $0 trades. There’s a thinkorswim app as well. But TD Ameritrade Mobile, the app designed for more casual investors, has plenty of good features.
It’s rare for a brokerage to charge zero commissions on stocks, ETFs and options and still offer such quality research, education and tools. TD Ameritrade also offers trading of more than 4,000 mutual funds with zero transaction fees and more than 700 with expense ratios of 0.50% or less.
Fees | Minimum | Tradable | Account | Fractional | Android | iOS |
---|---|---|---|---|---|---|
$0 for stocks, ETFs, options | $0 | Stocks, ETFs, Options, Mutual funds, CDs, Bonds, Metals | Taxable, Retirement, Trust | No | 1.8 | 4.7 |
The Details: Vanguard has become synonymous with low-cost, buy-and-hold investing — and for good reason. It offers a large number of proprietary, low-cost mutual funds and ETFs. That’s in addition to more than 3,100 mutual funds that carry no transaction fees.
According to an August 2021 Morningstar study, the average expense ratio for mutual funds and ETFs is 0.41%. Vanguard’s average is 0.09%. And it also slashed commissions down to $0 at the beginning of 2020, a significant move for a company that was managing $6.2 trillion in global assets at the time.
Vanguard founder Jack Bogle invented index funds. Many of the best robo-advisors follow a strategy that resembles what Vanguard has offered to self-directed investors for a long time.
If your goal is to follow the type of long-term investment strategy that Clark recommends, Vanguard is set up to cater to you. One of the downsides is that Vanguard’s tools and data are not nearly as robust as a few other names on this list. But you don’t really need those types of tools if you’re looking to buy and hold mutual funds, index funds and ETFs.
Note that, if you’re an everyday investor, you may find the minimum investment requirements too high. Vanguard’s robo-advisor option requires a $50,000 investment. Many of its proprietary funds carry minimum investments between $1,000 and $3,000.
Here are some other companies that I seriously considered including in our initial list of the best stock trading apps in 2021. They didn’t make the list for reasons I’d consider to be minor, so these companies may be worth considering for your personal situation.
For example, Clark doesn’t recommend options trading, which is risky and more akin to betting than long-term investing. But some people do trade options, and there’s one platform that stands out for its ability to serve those people.
All of the options below offer $0 commissions for stocks and ETFs.
Company | Why It Stands Out | Account Features |
---|---|---|
E*TRADE | Strong mobile experience | • Mobile app considered one of the best in the industry. • Requires $1,000 minimum balance to trade via mobile. • App includes access to Bloomberg TV, charts, third-party research and screeners. |
tastyworks | Best for options traders | • Intended for frequent options traders. • Charts focus on the probability of turning a profit on your options trade ideas. • Its tools evaluate common options trades such as iron condors and butterflies. |
TradeStation | Best for active traders | • Confusing but flexible price structure could benefit active traders. • Charting and tools are among the best in the industry. • Excellent for experienced traders who use custom strategies. |
Do not pass “Go” and do not collect $200 until you check the costs. Clark says that applies any time you plan to spend money, but it’s especially important with investing.
In most cases, there’s little reason in 2022 for you to pay a commission to buy and sell stocks, ETFs and even cryptocurrencies.
It’s important to understand the asset classes that each company offers. Some free investing apps don’t allow you to invest in mutual funds while others give you access to thousands of them.
When you’re looking for the best stock trading apps, another thing to consider is how easy it is to use. Is the app or website intuitive and fast? Are you able to get help from customer service? Also make sure to consider account minimums, research capabilities and investment tools.
Free stock trading apps:
There are some downsides to free, self-directed investment apps. They:
A full-service broker or financial advisor is a licensed professional who offers you personalized advice on your investments, taxes, retirement, estate planning and more. Put into simpler terms, a full-service advisor is an expert you pay to take care of all your financial needs.
This is the most expensive way to invest your money, as full-service advisors tend to charge the highest commissions and fees.
Most people don’t need that level of service. The fees will make a big difference in your long-term ROI, so consider using one of the stock trading apps in this post or a robo-advisor instead.
A robo-advisor is a digital platform that automatically invests your money into one of several diversified portfolios based on your age, risk tolerance and financial goals.
They’re significantly cheaper than full-service financial advisors but more expensive than self-directed investment apps like the ones in this story. Robo-advisors are helpful if you’re not interested in handling your own investments.
I also wrote about the best robo-advisors if you’re interested in learning more.
Not too long ago, if you wanted to invest in a publicly-traded company, your minimum investment was equal to the price of one stock. But that can cost hundreds of dollars (or more). At the time of this writing, a single share of Amazon stock (AMZN) cost more than $2,400.
Fractional shares let you decide how much money you want to invest in a company. Whether you want to buy $5 or $5,000 of Amazon stock, fractional shares unlock that ability.
Fractional shares are a great tool that allows you to diversify your investment portfolio even with a small amount of money. They can help you buy stock in a company you couldn’t otherwise afford. Buying fractional shares also finds a place for your leftover uninvested cash when you’re finished making your big buys.
Robinhood, SoFi, Schwab, Cash App, Fidelity and Interactive Brokers are just a few of the companies that offer fractional share trading.
You really can buy and sell stocks for free in 2022. However, that doesn’t mean that the company you use to execute those trades is a charity.
Robinhood, which pioneered free trading, makes absurd sums of money through something called payment for order flow (PFOF). Companies that offer free trades often make a lot of their revenue from PFOF by farming out the execution of the trade to third parties. At the very least, PFOF can cause small delays in order execution, and that can negatively impact your trade.
Most of the apps with free trades offer additional features for a price. Some of them are attached to larger companies that offer other services like banking. Some stock trading apps earn interest on things like uninvested cash.
And every stock trading app charges fees for certain transactions. For example, you’ll usually have to pay a fee to transfer your portfolio to another brokerage.
Yes, in the sense that any worthwhile investment app is SIPC-insured. The SIPC offers protection of up to $500,000 on your individual brokerage account if the company runs into financial trouble. So you won’t lose your money just because the platform you use goes out of business.
The companies behind these apps also are regulated by FINRA and the SEC.
However, you can still lose every dollar you invest in these apps. It’s possible to make risky trades that completely wipe out your investment portfolio. So it’s important to use long-term, well-diversified investment strategies. The stock market is not a casino and shouldn’t be treated as such.
The best stock trading apps allow you to invest in a variety of vehicles, including domestic and international stocks, ETFs, mutual funds, index funds, cryptocurrency, bonds, commodities, stock options, real estate and more.
It’s rare that a single investment platform will provide access to every possible investment type. One platform may offer you access to thousands of foreign stocks and another may offer only a few dozen.
So it’s important to understand what a stock trading app allows you to buy and sell, especially if you think you’ll ever invest in something other than domestic stocks.
I understand why robo-advisors are attractive. They’re reliable, inexpensive, hands-off investment companies.
I also understand the advantages of a full-service brokerage, especially for someone with a lot more money and complications than I have.
But as someone who doesn’t mind rolling up my sleeves and doing the research, you can’t beat the price of self-directed apps: free.
I don’t want to give away any of my profits to a company. And in 2021, there are good free options in every possible flavor. It’s easier than ever to find a self-directed trading and investing app that fits your personal goals and preferences.
This post was last modified on June 20, 2022 8:17 am
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