Trading in financial markets requires the right choice of a broker, as security of traders’ funds, their profit and opportunities depend on it. Before you start working with a company, it is important to comprehensively assess it. Traders Union analysts have already done it for you. The experts prepared a review of the Best OTC Stock Brokers in the US for 2024. Five companies that enjoy huge popularity in the US were selected and compared between each other.
1
Ally Bank - Best in the US for 2024
The Ally broker offers competitive pricing for options, with stock options trading fees reduced to $0.50 per contract. The company's clients can also trade ETFs and US-listed stocks with zero trading fees. Ally does not have a minimum deposit required to open a stand-alone securities cash account. However, to trade from margin accounts, you need to deposit $2,000 or more. For accounts with managed portfolios, the initial investment is $100. The minimum deposit for Forex accounts is $250.
2
Interactive Brokers - Best in the US for 2024
Interactive Brokers is militantly developing, offering services to investors regardless of their trading experience. For this purpose, the broker doesn’t ask for a fixed minimum deposit but has margin requirements for accounts of various structures to make trading financially safe. The size of the leverage and Margin call and Stop out levels depends directly on the asset that the client is trading.
3
M1 Finance - Best in the US for 2024
M1 Finance is focused on cooperating with investors, regardless of whether they have experience in trading, and provides optimal solutions for convenient work. Simultaneously, the broker highlights that its specialization is a long-term investment and not profit from short positions. Clients have access to accounts with different forms of ownership: in particular, an individual account, a trust account, a joint account, a pension account, and an account intended for minors. The minimum deposit is $100 for taxable accounts and $500 for retirement accounts. Trading is carried out on a platform developed by the broker. A striking feature of cooperation with M1 Finance is the dynamic rebalancing of the portfolio: the Pie system allows you to optimize the investment process and correctly distribute investments between segments.
4
SoFi Invest - Best in the US for 2024
SoFi Invest offers a convenient application for trading and investing in stocks, cryptocurrencies, ETFs, and IPOs. No commission is charged for trades in stocks and ETFs. Also, with zero commissions, the investor can purchase fractional shares of Stock Bits. SoFi Invest does not have a minimum deposit, however, Pattern Day Traders should have at least $25,000 on their account. Otherwise, the account may be limited under FINRA’s daily trading margin requirements. Pattern Day Trader consists of traders who trade securities four or more times within five business days, and the number of daily transactions is more than 6% of the total trading activity for the same period. The minimum order size for the purchase of cryptocurrency is $10, and the maximum is $50,000 per client per day.
5
Charles Schwab - Best in the US for 2024
Charles Schwab offers its traders and investors a superb StreetSmart trading platform. Trading is possible through the company's web terminal, in the mobile application, and using the desktop version. Opening an account is available from $1 with no additional service fees. No brokerage fee is charged for US stocks (except for high volume, difficult to execute contracts).
TU Expert Review for the best OTC Stock Brokers in the US
Financial expert and analyst at Traders Union
Anton joined Traders Union as a financial expert and analyst in 2013. He performs comprehensive internal testing of brokers as a trader. Essentially, Anton “test drives” brokers: he checks the operation of the website and user account, the speed and effectiveness of customer support team, stability of the software, deposit and withdrawal processing times, legal documents of companies and also all additional services (VPS, affiliate programs, contests, bonuses, educational programs, etc.). Based on the results of his “inspections”, he prepares expert conclusions about the operation of brokerage companies in the Forex, stock and binary option markets and also of the cryptocurrency exchanges.
His opinion as for the best OTC Stock Brokers in the US is posted below.
Ally Bank - TU Expert Review
Ally Bank is a financial holding company that has been offering online banking services since 2009. Since 2017, the company has been providing brokerage services, providing a money management platform, and access to Forex and stock markets. A high minimum deposit, lack of cent accounts, and absence of full-fledged training materials on the stock and foreign exchange markets indicate that the broker is aimed at working with professionals and experienced investors, but not with beginners. At the same time, Ally Bank offers a wide range of tools for options traders. These include options chains, probabilities, P&L calculators, and volatility charts. All of these tools are available free of charge to all customers. Forex traders can also use Ally as an intermediary in the foreign exchange market. In addition to currencies, the broker offers to trade metals on a spot basis. The company's website cannot be called the most informative, especially in matters related to Forex. The terms of trading accounts are not spelled out here, so you have to look for them on the GAIN Capital partner website and in the MT4 trading terminal specifications. Online chat is only available to customers with active accounts with Ally Bank.
Interactive Brokers - TU Expert Review
During its cooperation with Traders Union the Interactive Brokers investment company proved itself as a reliable partner, which faithfully fulfills its obligations to us. The broker provides clients with a wide range of services, allowing them to engage in both active trading and investments. At the same time, the broker charges a fee for an inactive account, and that's not convenient for passive investors. Despite the lack of a minimum deposit, Interactive Brokers is focused on working with professional market participants. The US and Canadian investors are the main target audiences of the company. Interactive Brokers customer support will help you resolve claims made to the company. You can find all the information about trading conditions and the specifics of various trading instruments on the broker's website. Before opening an account with this broker, we strongly recommend you to read about all trading conditions in detail, as well as reviews of other clients about cooperation with Interactive Brokers.
M1 Finance - TU Expert Review
M1 Finance is a broker that provides optimal conditions for long-term investment. The company aims to work with US citizens, regardless of their investment experience. Also, M1 Finance offers solutions for active investors who want to independently manage their capital. There are no opportunities for passive investment in the company, the only option to receive additional income for non-trading activities is to participate in an affiliate program. Services for copying transactions, for managed accounts, for using trading robots are not the focus of M1 Finance. To open an account, an investor will need $100, to open a retirement account, an account must be replenished with $500 or more. The company has developed its proprietary Pie system, which makes the portfolio rebalancing process more understandable and convenient for both novices and professionals. Other advantages of the broker are zero fees, the ability to trade from a mobile device, and financial compensation to investors in case of bankruptcy. The disadvantages of M1 Finance are the lack of electronic payment systems for conducting transactions, as well as the limited working hours of the support team.
SoFi Invest - TU Expert Review
The SoFi Invest stockbroker does not require a minimum amount to open an account, so it is good for beginner investors looking for an easy way to make money in the financial markets. Also, investing with SoFi Invest is a great option for those who already have active accounts with SoFi, because the client can easily transfer money between SoFi Money and SoFi Invest accounts. SoFi Invest may not be suitable for more advanced investors, as the broker does not offer stop-loss and sell-at-loss securities to offset capital gains tax liabilities. At the same time, the company offers active and automated investing, free access to certified financial planners, and the opportunity to invest in fractional shares of companies. SoFi Invest is a reliable company that is a member of FINRA and SIPC. It has also applied for registration with the Securities and Exchange Commission (SEC). A special thing of SoFi Invest is that currently, only US citizens can open accounts with the company.
Charles Schwab - TU Expert Review
Analysis of Charles Schwab broker’s conditions and its website showed that the company is equally focused on active online trading and investment. You can start on the stock market with a zero deposit, besides, it has its training program, so the broker is a real catch for newbies. The support service is available around the clock. The Charles Schwab broker offers a slightly different approach to margin trading. Instead of leverage, the size of which is calculated concerning the deposit, a margin lending system is applied. Hence, the client takes out a loan to buy securities and upon completion of the related transactions pays the broker interest at a rate of 8%. For instance, a client buys shares for $5,000, which allows him to buy the same amount on a loan. After the sale of these securities, he is obliged to repay Charles Schwab a loan of $5,000 + 8% ($400). A trader's net profit is the funds remaining after the sale of assets minus payment of brokerage fees and taxes.
Summary
Many brokers operate in the US, but not all of them are reliable or offer attractive trading conditions. TU experts selected 5 companies and rated them based on collected data. By reviewing them, you will learn about the Best OTC Stock Brokers in the US 2024 and will be able to evaluate the pros and cons of its closest competitors.
Overall score of the best OTC Stock Brokers in the US
| Ally Bank | Interactive Brokers | M1 Finance | SoFi Invest | Charles Schwab | |
|---|---|---|---|---|---|
|
Overall score |
7.8 |
9.1 |
8.9 |
8.8 |
8.6 |
|
Execution of orders |
7.5 |
8.8 |
8.6 |
8.5 |
8.3 |
|
Investment instruments |
8.1 |
9.4 |
9.2 |
9.1 |
8.9 |
|
Withdrawal speed |
7.9 |
9.2 |
9 |
8.9 |
8.7 |
|
Customer Support work |
7.7 |
9 |
8.8 |
8.7 |
8.5 |
|
Variety of instruments |
7.4 |
8.7 |
8.5 |
8.4 |
8.2 |
|
Trading platform |
8.2 |
9.5 |
9.3 |
9.2 |
9 |
|
|
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|
|
FAQ
Is it possible to work with offshore brokers?
It is best not to work with offshore brokers. However, if you have chosen such a company, you need to check and analyze it very thoroughly. There are offshore brokers with good reputations. Before you start working with such a company, deposit the minimum amount and start trading. Once you’ve worked with the broker for a little while and checked how it operates and how quickly it processes withdrawals, you can start depositing higher amounts.
What learning instruments can a broker offer?
Brokers offer various educational options. These include full-fledged educational courses, or video tutorials, articles, and books. Companies also often hold seminars and webinars.
Can you earn passive income in the financial markets?
Yes, the best brokers of the US offer passive income options. These could include copy trading, PAMM accounts, managed portfolios, etc.
What commissions and fees should I take into consideration when I am choosing a broker?
The commissions and fees in the financial markets are divided into trading and non-tradings ones. Trading fees are the fees that are charged directly during trading (spread, commission per lot, etc.), while non-trading fees are the ones charged outside the trading process (for example, account fee, inactivity fee, deposit and withdrawal fee).
Best OTC Stock Brokers by Countries
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Team that worked on the article
Mikhail Vnuchkov joined Traders Union as an author in 2020. He began his professional career as a journalist-observer at a small online financial publication, where he covered global economic events and discussed their impact on the segment of financial investment, including investor income. With five years of experience in finance, Mikhail joined Traders Union team, where he is in charge of forming the pool of latest news for traders, who trade stocks, cryptocurrencies, Forex instruments and fixed income.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.