Rating Methodology for Stock Brokers

Choosing a broker is a decision consumers should not take lightly. After all, this is the place where you will open a Roth IRA, a money market account, or a standard taxable brokerage account. To help you cut through the noise and make a simple decision, we thoroughly reviewed, analyzed, and tested over 15+ brokers.

SimpleMoneyLyfe rates brokers across 11 key categories. Below are the factors (and weighted average) product analysts evaluated:

Rating Factors Considered: A Closer Look at What Matters

The factors and their respective weights are features our team of industry veterans and experts deem to be critical for consumers to understand and consider. Considering these key decision-making factors will help consumers make an informed and confident financial decision.

Account Minimums (10%)

Some brokers require consumers to deposit a set amount of money to open a brokerage account. Analysts evaluate and highlight the required account minimums.

Account Fees (10%)

Analysts and the editorial team read the fine print. We evaluate account closing, transfer, and inactivity fees each broker charges. Consumers deserve an affordable trading experience, and our reviews make the account fees crystal clear.

Account Types (20%)

We evaluate and analyze what accounts consumers can open at each broker. Analysts value brokerages that offer a host of products, including taxable brokerage account, Roth IRA, 401(k) functionality, Traditional IRA, and a myriad of other accounts that provide consumers with an all-in-one solution.

Customer Support (5%)

Our team of experts thoroughly reviews the broker’s customer support capabilities. Living in a world that relies heavily on technology, we like to see online chat functionality, classic email support, and phone support.

Educational Resources (5%)

This category evaluates the broker’s educational resources. We like to see webinars, a robust blog covering key investment topics, and live events.

Tradeable Securities (15%)

This category evaluates what securities customers can trade on the broker’s platform. A robust and capable platform will offer customers a diverse selection of ETFs, mutual funds, fractional shares, individual stocks, bonds, cryptocurrency, and index funds.

Trading Costs (15%)

Analysts evaluate portfolio transaction costs. Some brokers charge customers for each executable trade – buying and selling a security. However, financial technology companies have redefined this category, and the new standard is commission-free trading. Our review process and methodology reflect this fundamental industry shift.

Research Amenities (5%)

Choosing the right investments and portfolio strategy requires deep, deep research. Brokers that offer a suite of research amenities to consumers receive favorable marks in this category. Here is what we like to see:

Platform Security (5%)

Analysts evaluate the broker’s security posture. This process involves reviewing applicable regulation, encryption, industry standards, SIPC Insurance, two-factor authentication, biometric identification, and data collection practices.

Portfolio Transparency & Analysis (5%)

We evaluate the broker’s ability to virtualize a customer’s portfolio. Customers deserve to see real-time stock quotes, current portfolio balances, transaction history, and position performance.

Website & Mobile Usability (5%)

Analysts participate in product demonstrations and test out each broker. We review the broker’s website and mobile application’s user experience. This category also includes reviewing the sign-up process, site navigation, and process for closing the account.

Information and Data Collection

Our editorial team and product analysts use various trustworthy sources to collect accurate information and data. We utilize publicly available data provided by the broker, expert interviews, first-hand experience testing out the product, Government Databases, and third-party sites (verified Google Reviews, iOS App Store Reviews, & Android Reviews) to collect applicable information.

Content Updates

Each broker is reassessed annually; however, our team maintains communication with our partners and updates content when new features are rolled out, company announcements are made to the public, or when fees are adjusted.

Stock Broker Review Team

The broker review team comprises experienced editors, financial industry veterans, and a handful of Chartered Financial Analyst’s. Collectively, our work has been featured in CNBC, Business Insider, MarketWatch, Fox Business, The Huffington Post, and countless other reputable financial media properties. All members of the team adhere to our strict editorial guidelines.