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Penny Stock Brokers For Casual Traders

Penny Stock BrokersThere are a number of different penny stock brokers in the United States that offer a variety of penny stock trading services.  The type of penny stock broker that is appropriate for a particular penny stock trader depends mainly upon how active a penny stock trader is trading penny stocks and their trading style.

If a penny stock trader is a casual or longer term penny stock trader, then there is no need to look beyond the traditional online stock brokerages such as Fidelity Investments, TD Ameritrade, or E-Trade.  These well known online stock brokers not only provide listed stock trading services, they are also penny stock brokers that provide adequate levels of service for casual penny and longer term stock traders.  More active penny stock traders will find these penny stock brokers services to be satisfactory, up to a point.  But there are other penny stock brokers for more active penny stock traders that provide additional penny stock trading services that would serve their trading requirements better.

The traditional online stock brokerages offer penny stock commission schedules that include the purchase or sale of unlimited shares of penny stocks that can be bought and sold online for a flat fee of $10 or less.  The traditional online stock brokerages also offer a great deal of information about penny stock companies; however, this information is available elsewhere on the Internet on websites such as Pink Sheet (, and therefore is not something that is a value added service.  What the traditional online stock brokerages do offer to penny stock traders is solid penny stock trading services and reasonable commissions that make them worthwhile for casual or longer term penny stock traders.

Traders looking for higher levels service from penny stock brokers will pay additional fees, but in return they will have access to penny stock trading services that can provide them advantages regarding getting into and out of penny stocks at specific price points.  These higher levels of service include Level II Quotes that provide all of the best bid and best ask quotes and the associated order sizes for penny stocks.  Some penny stock brokers also offer proprietary trading products that allow penny stock traders test out penny stock trading techniques to fine tune and test their penny stock trading skills.

Penny Stock Brokers For Active Traders

For active penny stock traders and penny stock day traders, more sophisticated penny stock brokers are better suited to their trading needs.  Active penny stock traders require additional control over their penny stock trades to ensure that they enter and exit penny stock positions at a specific prices and at the time they want to execute the trade without any delays due to broker delays and the trading services brokers deal with.  For these active penny stock traders, direct access trading systems (DATs) are an excellent tool for trading penny stocks to provide them the trading speed they require to maintain a trading edge.  Using DATs involves paying additional fees; however, DATs provide order routing control, which allows penny stock traders to route trades directly to available market maker and electronic communication networks (ECNs) bids and offers for penny stocks, without the delay of going through a broker middleman.  The order execution control and speed that DATs offer make the extra fees worthwhile for highly active penny stock traders, since DATs allow active penny stock traders to obtain the best price possible when buying and selling penny stocks; which increases the potential for booking penny stock trading profits.

The penny stock market is different than trading listed stocks when it comes to buying on margin or shorting.  Many United States based penny stock brokers do not permit margin buying and shorting of penny stocks.  Active penny stock traders who want to be able to use margin to buy penny stocks or to sell penny stocks short, may need to open up an account with penny stock brokers that are outside of the United States, where different rules apply.

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