Choosing a Brokerage
Fool's School

If you're ready to invest in stocks, a brokerage account will come in handy. Opening one is not much more complicated than opening a bank account. Consider the following as you compare brokerages.

• Costs. Find out how much each contender will charge you in commissions per trade. It can vary from $7 or less to more than $100. Also look at what other fees are charged, such as IRA custodian fees, wire transfer fees, account inactivity fees, annual fees, etc.

• Minimum initial deposit. Some brokerages require at least several thousand dollars, while others have no minimum.

• Usability and service. Check to see how easy its online trading interface is to navigate and use. Ask some questions and see how responsive its customer service people are.

• Banking services. Some brokerages now offer banking services, such as check-writing, money market accounts, credit cards, ATM cards, direct deposit and more. Look into these if you're interested.

• Research. Many brokerages now offer free company research reports.

• Mutual fund offerings. Many brokerages offer a variety of mutual funds. If you're interested in particular funds, check to see whether they're offered. Know, though, that you can usually buy into mutual funds directly from their companies, bypassing brokerages. (Learn more about funds at www.fool.com/mutualfunds/mutualfunds. htm and www.morningstar.com.)

• Non-stock offerings. If you're interested in bonds, for example, see whether they're offered.

• Convenience. Would you rather place trade orders through an actual person, touchtone phone or online? See which brokerages offer what you want.

Some of these factors are more important than others. For example, if you trade only twice a year, commission costs might not matter too much. To guide your decision, make a list of all the services you need and how vital they are - then evaluate each contender on each measure.

For more guidance, visit www.broker.Fool. com and www.sec.gov/investor/brokers.htm.