Stock Trading and Other Things

What exactly are Discount Brokers? How do they Differ from regular brokers?

Online discount brokers such as Scottrade seem to offer very cheap stock buying opportunities. Are they any good? Will I get the same good results out of my investments?

Public Comments

1. Discount brokers provide a lower level of service and charge lower prices. It's like going to a store where you have to bag your own groceries. If you want advice on how to invest your money, you have to pay for it. If you want to do it yourself, it is cheaper.

2. They are cheap because you don't get much if any advice. If you know what you are doing, it is not a problem.
Regular brokers offer advice and try to build a portfolio with you. This is why they cost more.

3. You are pauing to use their platform and not their service. You save your money but you are basically on your own to make money or lose money.

4. 1) Yes.
2) Yes.

5. A discount broker just executes your orders. That is all. No advice. I found the advice from "full service" brokers to be self-serving and usually wrong. Their latest hype from the front office. Handed out by some young buckeroo that just graduated from the local college in accounting and thinks he is Jesse Livermore.

My counsel is to be your own adviser. Do your own research, make your own decisions. Make your own mistakes. Or, make a bunch of money because you got good at it over time.

I've been with Charles Schwab just about since their formation and they work just great. No mistakes. Very knowledgeable people, good trading platform. And, no advice.