The Top 3 Stock Brokers For Penny Stock Trading

penny-stock-brokers-brokerage

There is no such thing as a “penny stock broker”, however, if your main style is trading in penny stocks then there are some online stock brokers out there that are more suited to that trading strategy.

If you are looking to get into trading penny stocks, then here is my recommended list of the top 3 brokers for penny stock trading.

1. Suretrader


https://suretrader.com

Suretrader is an offshore broker based in the Bahamas and is one of the newest brokers to the online brokerage scene.

They offer a really good value, offering a flat commission rate of $4.95 per trade or a per share commission rate of 0.00495 per share

What I like about SureTrader is that you don’t need 25k to day trade. Since they are based in the Bahamas you don’t have to worry about the Pattern day trader (PDT) rule.

This is great for anyone who is an active trader or wants to day trade and has a smaller account.

For those not familiar with the PDT rule, it is a rule in the United States that if you buy and sell the same stock or option on the same trading day four or more times within a period of five trading days, you will be considered a pattern day trader.

Day traders are required to maintain $25,000 equity in their brokerage account at all times. If the account equity falls below $25,000, a day trading minimum equity call will be issued on the account requiring them to deposit additional funds. If the equity call isn’t met, then the account will be restricted.

So, basically with SureTrader you can avoid the PDT rule and trade with just $2,000, instead of the normal 25k that is required to day trade in the USA.

Besides that they offer great tools for traders and they also offer a free paper trading account, which is great for new traders that want to get some experience and education.

Another great thing about SureTrader is that they offer a great opportunity for trading and short selling penny stocks with lesser fees than brokers based in the United States. Visit the Suretrader website to learn more about them.

Suretrader – Standard Commissions

Stock Trades Options Per Contract Min. Account Deposit
$4.95 per trade or a per share commission rate of 0.00495 per share $1 $500

2. Speedtrader


SpeedTrader is built for very active traders. They are the sister company of SureTrader. I have used SpeedTrader for a number of years now, and so far my experience with them has been excellent.

Both use the same platform and basically the same system. The reason I recommend SureTrader first is because the majority of people out there have accounts less than 25k, so you can day trade with them and bypass the pesky PDT rule.

As far as commission, they offer very competitive commission rate with two options when you open an account.

  • Plan A: is $6.95 per trade.
  • Plan B: is .0039 per share, with a minimum of 1.99 per trade

The above commission rates can be negotiated for each individual trader.

Speedtrader uses the DAS Trader platform, which has been around for years. It is a great day trading platform that is simple, easy to use and with good execution. The platform comes with a fee, but it is waived if you generate a certain amount of commission for that month.

Speedtrader is great for trading penny stocks and currently has the best direct-routing for OTCBB/Pinksheets orders of any brokerage out there.

SpeedTrader – Standard Commissions

Stock Trades Options Per Contract Min. Account Deposit
$6.95 per trade or $.0039 per share ($1.99 minimum per trade) $1.00 $500

3. Interactive Brokers

interactive brokers - broker for trading penny stocks

Interactive Brokers is another broker I use to trade penny stocks. They offer low commission rates and I think they are one of the best brokerage out there for any type of active trader.

They have one of the best professional trading platforms in the industry, which is fast and offers you the ability to customize it.

Their commission rate is pay-per-share, where customers pay $0.005 per share, with $1 minimum per order and no maximum.

If you trade penny stocks, then Interactive Brokers is the way to go as they have no surcharges on penny stock. They also offer good borrows for shorting penny stocks, even penny stocks that that trade OTCBB/Pink Sheets.

Interactive Brokers – Standard Commissions

Stock Trades Options Per Contract Min. Account Deposit
$0.005 per share $0.70 $10,000

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