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Q: Best online broker ( Answered 5 out of 5 stars,   0 Comments )
Subject: Best online broker
Category: Business and Money > Finance
Asked by: journeyer-ga
List Price: $20.00
Posted: 30 Sep 2003 11:51 PDT
Expires: 30 Oct 2003 10:51 PST
Question ID: 261604
I am looking for a best US online discount broker for myself. 

I am not US citizen nor resident, but citizen and resident of Finland.
My residence is likely to change within next 5 years. I would like to
invest in US since the fees are lower and number of investment
opportunities is large.

I have used Schwab until now and will continue with them, but this new
account should be with a different broker. I will invest around
$100,000 and will trade only 1-2 trades per year. Investments will be
mainly in bonds.

I am not looking for investment advice, since I have that already from
Schwab, but rather a safe, reliable and low cost broker.

I have noticed that many US brokers no longer accept foreign accounts
after September 11th and hence the choice is more limited than it was
few years ago.
Subject: Re: Best online broker
Answered By: leader-ga on 30 Sep 2003 20:19 PDT
Rated:5 out of 5 stars
Hello journeyer-ga:

It was a pleasure to answer your question. From your question, I can
safely assume that you are looking for a very reliable online US
broker. Your investment will mainly be in bonds and you are not a US

Allow me to answer the question step by step. The first question is
how may we find the best online discount broker? The best solution to
the problem is to look at the rankings of the online discount brokers
by major industry evaluators. Before I provide you with the rankings,
I want to stress that there are many factors that must be considered
and the rankings are not the sole measure of your success with your
future broker. As the consumer advocates from the Online Investor
Complaint Center reveal that  some
online broker rankings appear to suffer conflict-of-interest,
objectivity, and credibility problems as online brokers maintain
strategic partnerships and financial relationships with some of the
online brokers they rank.

But again, how do we know who is the best? The simple answer is that
we have to trust these research reports as some of them are from
highly reputable source and choose the best according to our needs,
not by the rankings. Rankings are there just to help us evaluate the
performance of these online brokers and their credibility up to a
certain extent.

Since, rankings are our best tool. Here is the summary of the best
discount online brokers.



Below are the results from the independent evaluators, considered the
best resource by most industry professionals.

Category: Discount Brokers

1. Fidelity Investments (review) 

2. Charles Schwab (review) 

3. E*Trade (review) 

4. Harrisdirect (review) 

5. TD Waterhouse (review) 

For more comprehensive data, please visit
OR go to and click on ‘Benchmarks’ from the top


Below is the result of the rankings by one of the most authoritative
source of research in the world.

1)	E*Trade Financial Network










For more results, please go to

(Please note that the heading says ‘Mutual Funds’ but is not a ranking
for mutual funds only but online broker rankings. Please see the side


Nobody can overlook the reviews by the best news source for investors.
Following is their decision:

Category: Online Discount Brokers

1. TD Waterhouse
2. Muriel Siebert
3. Bidwell
4. Scottrade
5. Harrisdirect
6. BrownCo
7. Firstrade
8. Ameritrade
9. E*Trade
10. Wells Fargo

For more complete analysis, please visit


You just have to trust the Forbes rankings. It is after all, ‘Forbes’.
Here is their result:

Note: There are no rankings but the discount brokers that were
selected for Forbes Favorite and Best of the web pick.

Charles Schwab (Forbes Favourite)
Following is the ‘Best of the web’ pick (not in any specific order)

Merrill Lynch Direct
TD Waterhouse

For a complete list, please click on the link:


Barron is the trusted source of ranking and is a subsidiary of Wall
Street Journal. Following is an article on their rankings.


This is another great resource for online rankings. You will find more
information by clicking on the following link:



One or two years ago, there were very few online brokers that offered
bond trading but the trend has changed in favor of the investor. Two
years ago, E-trade financial was the first one to offer extensive and
diversified categories of bonds and other websites have followed since

It is good to hear that your major investment will be in bonds because
the discount online brokers charge a high fee for trading in bonds. It
means that if you were to trade bonds only in small amounts, the high
fee might be too much in comparison to the small price of bonds
traded. Large bond trading is considered a good value because the
large number of bonds will offset the high fees.

If you don’t understand my point, following articles will help




You are right in assuming that the choice is limited for foreign
accounts after September 11. The good news is that most major online
brokers still offer non-US residents a choice to open an account with
them. They are just more cautious and ask you to provide more details
before trading online. I know for a fact that three of the largest
discount online brokers, E-Trade, Fidelity Investment and TD Warehouse
offer non-US residents to open an account with them. I am not sure
about the others but most major online brokers do offer such a choice.
You will have to check individually with them.

According to Trade Wiser, an online stock broker, “For international
investors seeking to trade the U. S. Stock Markets, most major online
stock brokers now welcome foreign accounts. The only countries where
most online brokers are still unable to service accounts are Cuba,
North Korea, Iran, Iraq, Libya, Afghanistan, Sudan, Serbia, and
Yugoslavia. This list can change overnight and a quick email to the
broker of your choice will provide you with a update.”
(Source: )

Here is an example of what you will need to provide online brokers to
open a foreign account with them:

E-Trade Financial
Fidelity Investment
TD Waterhouse
Call 1-212-344-2525 to find out more.



I hope this helps. Please clarify, if you need to further information.
I will be obliged to help you. Thanks for using Google Answers and
Good Luck with your investment.

Request for Answer Clarification by journeyer-ga on 03 Oct 2003 15:40 PDT
Sorry for a delay. I've been travelling. 

I find your answer excellent. It has saved me considerable time and
effort. While I could have done this research myself, it would have
been too time consuming and I would have never finished doing it.

I would like you to make one clarification:
- If you were me (a foreigner, doesn't deal much, with 100k$ to invest
in bonds) which broker would you choose?

And I would like to ask for a pointer (answer to this was not part of
the question, and you really don't need to do this, just asking)
- Do you know a site where I can get detailed info on investing in
bonds? I.e not just the idea and types of bonds, but valuable
information on how and which bonds to buy. Kinda like Yahoo!Finance is
for stocks?

Clarification of Answer by leader-ga on 03 Oct 2003 16:16 PDT
Thanks for asking.

Before clarifying, I need to look into something myself so as to
provide you with the best possible answer.

Since I myself am very busy these days, please allow me to answer your
question within 48 hours. I need to investigate a little more.

I will get back to you very promptly.

Thanks again.


Clarification of Answer by leader-ga on 05 Oct 2003 10:01 PDT

Sorry for the delay. I am working on your clarification request and
will post my answer today. (4 Oct EST USA).


Clarification of Answer by leader-ga on 05 Oct 2003 15:40 PDT
Hello journeyer-ga:

First of all, I have a complaint. Why did you post such an interesting
question? The reason for my delay is that I myself got immersed in the

Instead of arguing for my choice, I will like to come to the point.

Considering the three options (foreigner, doesn't deal much, with
100k$ to investin bonds), my choice is (without any doubt) TD

The reason is simple and clear.

1. TD Waterhouse is a very reputable company.
2. The customer satisfaction is extremely high and is 'excellent' for
such a large discount broker.
3. It always gets rave reviews from experts.
4. It has worldwide presence which allows it to focus its offerings to
a diverse clientele from around the world.

It was difficult for me to come out with one winner but If I had any
ranking criteria (based on limited information about you), TD
Waterhouse would be a clear winner.

The second part of your question deals with a website where you may
get up to date information on bonds? Again, the most authoratative
website is I am not sure if it deals with
foriegn bonds. I know for sure that it is the most comprehensive
website for North American Bonds.

I hope this helps. Please clarify, if you need more information. I
will be obliged to reply to such an interesting inquirey.

Thanks for using Google Answers.

journeyer-ga rated this answer:5 out of 5 stars and gave an additional tip of: $10.00
This answers is complete and excellent for my purposes. Actually there
is more information than I requested and it is very relevant to my
situation and much appreciated.

I had earlier misunderstood some issues and they were clarified here
saving me time and money. As far as investments are concerned,
knowledge is $$$. Great work leader-ga.

There are no comments at this time.

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