Financial Genius

Readers,

I am often asked the question, “Who do you trade with?”  Unfortunately, the answer is not so simple, and in most cases, the inquisitor seems to expect the business card for a good brokerage agent or firm like they would expect a lawyer in times of trouble.  On the contrary, and without much detail, what they usually receive is a targeted answer based on what I know about where they’re attempting to invest and how experienced they are as a trader.  More truthfully, I utilize several platforms and avenues for different purposes.

I never use a broker if I don’t have to, because they have a mind and emotions of their own.  Brokers are only necessary when securities cannot be traded electronically.  Very few securities are setup like this these days, but it still happens on occasion.  When it does, you want a “drone” broker.  Drone brokers are gentlemen that sit at a trading desk all day long taking hundreds of orders a day.  If you use a TD Ameritrade broker; they’ll take care of you — quickly.

TD Ameritrade is the best and the brightest when it comes to trading penny stocks and maintaining watch lists.  I also enjoy their day-trading platform when I’m moving pennies like a dump-truck.  The thing about penny and sub-penny companies is that they tend to change their names and trading symbols often.  I’ve had other platforms miss the ball when these changes occur, but Ameritrade hasn’t missed it once for me even though I had a small form to sign and fax back when I initially got started.

Knowledgeably and service is also no shortcoming of Ameritrade’s.  When you call, there’s a solid specialist always ready to assist.  When you have a question, it can be answered by an online AI agent, a knowledge base of media-rich training presentations, or the same helpful specialist.

While their cash sweep system can sometimes be confusing to newcomers, Ameritrade has fewer distractions than any platform I know of which is why I usually recommend it to beginners.  This forces a new investor to seek out sources for information, learn about the SEC and FTC, understand options and futures, learn to differentiate emotion from sound decision-making, and understand the effect of the press.

One additionally nice feature of Ameritrade is that they allow account linking and nice separation.  This means that if you’re assisting a family member or friend with trades or if you’ve inherited securities, it’s easy to keep your securities separate from theirs while still being able to excercise control over the assets.  This tends to help at tax time.

E*Trade is easy to setup, they are a full-fledged banking system, their FDIC insurance can cover into the millions of dollars, and they make you physically sign the fewest number of forms of any trading institution I’ve ever worked with.  E*Trade allows for after-market trading and the standard futures, options, etc.

What E*Trade has that the others don’t is simple global trading.  In the past, global market trading was a nightmare.  I now use E*Trade for all of my global and large-sum US investments (thanks to their insurance rating) as well as for alternate checking and savings accounts when Wells Fargo is just gettin’ me down.

I also participate in IPOs (Initial Public Offerings) published by underwriters (usually a banking institution).  One of the biggest underwriters in many IPOs is Wells Fargo.  Since I bank with the “Farg” on a regular basis, I usually don’t have too much trouble picking up securities when they first hit the exchange.  This is a very different process from your common security investment process, but E*Trade is offering a simple way to do this now too.  I plan to participate in my next IPO through E*Trade.

Unfortunately for E*Trade and their customers, I rate their customer support as a “low”; that’s as in “devil’s basement” low.  The staff person I most recently conducted business with had, “… worked with the system for two years now…”, so he thought he had it all figured out.  The second representative had a similar mindset but must not have been there for quite as long, because his mind was still open to some degree.  After nearly reaching through the phone a few times, he was finally able to assist me.

When it was all said and done, I felt like appending, “Now that wasn’t so hard, was it?”, to my sigh of relief, but I didn’t.  On second thought, being open-minded enough to assume that they must be brainwashed slowly over the course of employment, I gave them the benefit of the doubt and thought that maybe it wasn’t really their fault.  For those who hadn’t been brainwashed long enough, it still seemed that there was hope for them yet.  It just takes a strong customer willing to repeatedly tell them they are wrong until the light bulb goes off.

Zecco is the MySpace of trading.  They offer group discussions, show member earnings like it’s all a contest, and by far look the coolest.  Unfortunately, the signup process includes a lengthy agreement that makes me feel for the poor schmuk who was forced to write it.  Personally, I’m not a huge fan of the service overall, but it’s a good source for learning how the common public investor thinks and operates with consistently visible emotion, and the concept also helps we experienced traders have more volume, readability, and return in our daily practiced habits.

What’s really sad about this platform, is that it breeds bad trading practices.  Inexperienced traders see success dangled in front of them like a carrot in front of a rabbit and then turn around and participate in the emotional discussions brought on by other terribly inexperienced traders.  This keeps them losing and tugs on my heart strings a little every time I think about it.

In all, the platform you choose depends on your needs and experiences.  Obviously, one platform wasn’t good enough for me, and it may not be good enough for you either.  I’ll tell you one thing though; no private brokerage agent was ever good enough for me.

~A