Choosing A Broker: Scottrade

Today, I will continue covering the basics of the discount brokers by highlighting Scottrade.

Remember, the level of services you need will help you decide whether to go with a full-service broker or a discount broker.

How To Trade: Scottrade offers online, touchtone phone and broker-assisted trades. Scottrade has 422 branches spread across 48 states, and the District of Columbia.

Photo by Kevin, courtesy of flickr

Scottrade allows investors to trade a variety of securities including stocks, bonds, options and mutual funds.

Commissions: Scottrade is known for their commercials boasting the flat rate $7 commission for online trades.

Touchtone phone trades cost $17 and broker-assisted trades cost $27 each.

There are additional fees for trading stocks valued at less than $1 per share, and certain restrictions may apply for foreign and pink sheet stocks.

Account Minimum: The minimum amount to open a cash account is $500. A minimum of $2,000 is required to open a margin account. There is no minimum initial deposit required for retirement accounts.

FYI: Scottrade also offers free checking and there are no charges for account inactivity. Today, Scottrade launched a free online education center called the Knowledge Center. Scottrade’s web site has a nice price comparison chart of online brokers.

For more information on trading with Scottrade, visit scottrade.com. For Scottrade reviews, visit Dogs of the Dow and the SmartMoney Annual Broker Survey.

Tomorrow, I will profile Sharebuilder.

Disclaimer: Brokerage commissions are subject to change, explore them yourself by visiting the broker’s web site or calling customer service for up-to-date information BEFORE you place any trades. The prices provided within this post were compiled on 7/27/09.