Advertiser Disclosure

Best Online Trading Platforms for Day Trading

April 10, 2019
Brokers, Investing
At cheatgame.info, we adhere to strict standards of editorial integrity to help you make decisions with confidence. Many or all of the products featured here are from our partners. Here’s how we make money.

cheatgame.info offers financial tools and advice to help people understand their options and make the best possible decisions. The guidance we offer and info we provide are deeply researched, objective and independent.

We spent over 300 hours reviewing the top online brokers before selecting the best for our readers. And to help you find the one that’s best for you, we’ve highlighted their pros, cons and current offers.

If you’re an active trader looking to try your hand at beating the market, you probably have a good idea of what you want in a brokerage: low costs, premium research, innovative strategy tools and a comprehensive trading platform. Below, we’ve selected the best online brokers in a variety of categories so you can choose one based on your personal priorities.

One note before you begin: Pattern day traders — as defined by the SEC — must have at least $25,000 in equity in their accounts and be approved for margin trading, regardless of whether their broker’s account minimum is lower.

» New to this world? Learn the basics with our guide to how day trading works.

cheatgame.info’s top online trading platforms for day trading

cheatgame.info rating

Fees

$4.95

per trade

Account minimum

$0

Promotion

Up to $3,500

in cash bonus with a qualifying deposit

The bottom line

Ally Invest’s robust trading platform and lineup of free research, charting, data and analytical tools make it a good choice for active traders. But it’s also appropriate for beginning investors who will appreciate that there is no account minimum and no annual fees.

Show pros & cons

Pros

  • Low commissions.

  • No account minimum.

  • Strong web-based platform.

  • Robust research and tools.

Cons

  • No no-transaction-fee mutual funds.

  • No branches.

Read full review
cheatgame.info rating

Fees

$6.95

per trade

Account minimum

$0

Promotion

60

days of commission-free trades with qualifying deposit

The bottom line

TD Ameritrade makes up for higher-than-average trading commissions with better-than-average service, research and trading tools that will make everyone from beginner investors to active traders happy.

Show pros & cons

Pros

  • Large investment selection.

  • Free research.

  • High-quality trading platforms.

  • No account minimum.

  • Good customer support.

Cons

  • Higher trade commission.

  • Costly broker-assisted trades.

  • High short-term ETF trading fee.

Read full review
cheatgame.info rating

Fees

$5.00

per trade

Account minimum

$500

Promotion

None

No promotion available at this time

The bottom line

TradeStation is the gold standard among active stock, options and futures investors who rely on the broker’s high-octane trading platform, reams of research and sophisticated analytical tools. The firm offers three commission plans — flat-fee, per share/per contract and unbundled pricing plan (the latter two of which will be attractive to active traders). The lack of commission-free ETFs and mutual funds can be a turnoff to some investors.

Show pros & cons

Pros

  • High-quality trading platforms.

  • Comprehensive research.

  • Low commissions.

  • Advanced tools.

  • Active trader community.

Cons

  • No commission-free ETFs.

  • Minimum balance requirement for active trading platform.

Read full review
cheatgame.info rating

Fees

$0.01

per share

Account minimum

$0

Promotion

None

No promotion available at this time

The bottom line

Interactive Brokers is a strong option for advanced, frequent traders: The broker offers international trade capabilities, low commissions and a quality trading platform. New traders might be turned off by inactivity fees, high balance requirements and a lack of educational resources.

Show pros & cons

Pros

  • Low commissions.

  • Quality trading platform.

  • Advanced tools.

  • Low margin rates.

  • Wide investment selection.

Cons

  • Inactivity fees.

  • Complex pricing.

  • Minimal educational resources.

Read full review
cheatgame.info rating

Fees

$4.95

per trade

Account minimum

$0

Promotion

$100

cash bonus with a qualifying deposit

The bottom line

Charles Schwab has earned its strong reputation: The broker offers high-quality customer service, two robust trading platforms and a wide selection of commission-free ETFs and no-transaction-fee mutual funds.

Show pros & cons

Pros

  • No inactivity fees.

  • Two platforms with no minimum or fees.

  • Above-average mobile app.

  • Extensive research.

  • Strong customer support.

Cons

  • Higher trade commissions.

Read full review
cheatgame.info rating

Fees

$3.00

per trade

Account minimum

$500

Promotion

None

no promotion available at this time

The bottom line

EOption provides an efficient, no-frills platform for active investors who prioritize low costs over a fancy platform. The savings can be significant for advanced stock and options traders who have other sources for the research and data they need.

Show pros & cons

Pros

  • Deep discount commissions.

  • Low margin rates.

  • Can serve international investors.

Cons

  • Very basic trading platform.

  • Limited data and research.

Read full review


Best platforms for day trading: summary

Broker
Best
for
Highlights
Commiss-
ions
Promotion
Account minimum
Start investing

Ally Invest

Ally Invest
Options trading
Free high-quality trading platform
$4.95
base + $0.65 per contract
$100 cash bonus or up to $500 in free trades with a qualifying deposit
$0

TradeStation

TradeStation
Options trading
Advanced research and tools, speedy execution
$5 Per Trade + $.50 Per Contract for Options + $1.50 Per Contract Per Side for Futures
None
$500

TD Ameritrade

Overall
+
Trading Platform
Top research; two powerful trade platforms; educational content
$6.95
per trade
$100 to $600 cash bonus, depending on account size
$0

Interactive Brokers

Overall
+
Low margin rates
Discounts for frequent traders; max margin rate is benchmark +1.5%
$0.005
per share;
min. $1, max. 0.5% of trade value
Lower min. activity and balance limits for clients ≤25
$10,000
($5,000 for IRAs)

Charles Schwab

Charles Schwab
Trading Platform
Extensive research; two trading platforms
$4.95
per trade
$100 referral award for first-time clients
$0

EOption

Low margin rates
Attractive margin rates
$3.00
per trade
None
$500

Our rating methodology

cheatgame.info’s ratings for brokers and robo-advisors are weighted averages of several categories, including investment selection, customer support, account fees, account minimum, trading costs and more. Our survey of brokers and robo-advisors includes the largest U.S. providers by assets under management, notable and/or emerging players in the industry. Factors we consider, depending on the category, include advisory fees, branch access, user-facing technology, customer service and mobile features. The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

Day trading FAQs

We’d recommend starting with our guide for how to day trade — it covers a lot of the day trading basics you need to know. But then, practice makes perfect — or as close to it as you can get, as you’ll quickly learn there is no perfect in day trading, and even the pros lose money sometimes.

The best way to practice: With a stock market simulator or paper-trading account. Many brokers offer these virtual trading platforms, and they essentially allow you to play the stock market with Monopoly money. Not only do you get to familiarize yourself with trading platforms and how they work, but you also get to test various trading strategies without losing real money. The link above has a list of brokers that offer these play platforms.

In short: You could lose money, potentially lots of it.

Day trading is exactly what it sounds like: Buying and selling — trading — a stock, or many stocks, inside of a day. It’s all about making predictions and timing the market, with the goal of making a small profit on each trade. In an ideal world, those small profits add up to a big return.

But research has shown that only 1% of day traders consistently earn money; many, many lose it. It’s essentially a full-time job, because you need to constantly be watching — and timing — the market, waiting for your next move. It isn’t for beginner, or casual, investors.

If you’re interested in day trading, our recommendation is to allocate a small portion of your overall portfolio to the strategy – no more than 5% or 10%, tops. That way, if you lose money — as you are likely to do, at least at first — those losses are at least capped. The rest of your portfolio should be invested in long-term, diversified investments like low-cost index funds.

Day trading is risky, but it isn’t illegal. However, the Securities and Exchange Commission imposes specific regulations on pattern day traders.

The SEC defines day trading as buying and selling or short-selling and buying the same security — often a stock — on the same day. A pattern day trader, according to the SEC, is a trader who:

  • Day-trades four or more times within five business days and
  • Those day trades represent more than 6% of their total trading activity during that five-day period

If you fall into that category, you’re required to maintain at least $25,000 in equity in your account. That equity can be in cash or securities.

Note that once a broker has identified you as a pattern day trader due to the above activity, your account will likely be considered a pattern day trading account going forward, even if you don’t continue to meet the definition. If you decide to stop day trading, you’ll want to your brokerage and ask that they remove the minimum equity requirement from your account.

This is a loaded question. The SEC requires that you maintain a minimum of $25,000 in equity to engage in pattern day trading, but that equity can be in cash and eligible securities. That’s the minimum amount you need to maintain in your account; on top of that, you also need the money you’ll use to day trade.

But just as important is setting a limit for how much money you dedicate to day trading. Our recommendation is that those dipping into this kind of active trading should risk only a small portion of their account balance — 5% to 10% of your investable assets, at most.

Margin is essentially a loan from your broker. When you open a brokerage account, you’ll be asked if you want a cash account or a margin account.

A margin account allows you to place trades on borrowed money. Often called leverage, trading on margin can magnify your gains — and, in the worst-case scenario, your losses. To read more about margin, how to use it and the risks involved, read our guide to margin trading.

A few things are non-negotiable in day-trading software:

  • Low commissions. You might’ve gathered by now that day traders place a lot of trades. You’ll pay a commission each time you buy and sell; that cost can quickly eat into your returns. Pay close attention to a broker or day trading platform’s fees and commissions. Many brokers will offer volume pricing, which is ideal for day traders.
  • Research and strategy tools. Day traders use data to make decisions: You want not only the latest market data, but you also need a platform that lets you quickly create charts, identify price trends and analyze potential trade opportunities.
  • Speed. Time is literally money with day trading, so you want a broker and online trading system that is reliable and offers the fastest order execution. Many platforms will publish information about their execution speeds and how they route orders.

Another feature we’d recommend is a broker or trading platform that offers paper, or virtual, trading, so you can practice with simulated trades before the real thing.

If we knew, we’d be very rich. This is the bit of information that every day trader is after.

That said, we can give you some general guidance. There are a few things that make a stock at least a good candidate for a day trader to consider:

  • Highly liquid, with large trade volume.
  • Relatively volatile. You want frequent price changes, which allows you to make a profit quickly.
  • Known to you. An understanding of the stock’s price history, and how it reacts to various events — earnings reports, economic shifts — is key. Many day traders trade only a few specific stocks, developing expertise in those companies and narrowing their focus. (Here’s some detailed guidance on how to research stocks.)
  • Newsworthy. Coverage of a stock will trigger people to buy or sell it. As a day trader, you’ll want to follow the news to find trade ideas.

You can use your online broker or trading software’s stock screener to look for stocks that seem ripe for day trading.

About the authors