While penny stocks are risky to trade for beginners, they are a great way to capture massive returns with a small investment. Penny shares are cheap to buy and volatile, meaning fortunes can be made or lost overnight. For every trader who became a multi-millionaire, there are horror stories of people blowing up accounts and end up owing money! With that in mind, before you open an account with a brokerage, make sure you’re 100% ready.
Although there are dozens of stock brokers with no account minimums, not many of them are suitable for penny stocks. Luckily for you, I have compiled a list of the best penny stock brokers with no minimum deposits and charge cheap commissions.
- TD Ameritrade is one of the most reputable online brokers with no account minimums for clients!
- Ideal for penny stocks as they charge a $6.95 fee per trade with no surcharges on stocks under $1, making it more affordable to trade OTCBB and Pink Sheet stocks.
- Two great trading platforms available to all customers – Thinkorswim and Trade Architect.
- Robust charting tools that can be customized to meet your requirements.
- Don’t have annoying inactivity or maintenance fees.
- Free access to real-time quotes and level 2, perfect for active day traders
- Customer service is average, to lower costs they outsourced it to cheaper countries such as India.
- E-Trade is my number one pick as the best broker for trading penny stocks.
- Is a highly recommended broker for short selling shares under $5.
- Flat fee commission structure with no extra fees on penny stocks!
- Discounts given to active traders, $6.95 commission for less than 30 trades every quarter, make more than 30 trades and the fee drops to $4.95.
- Don’t accept customers from certain countries which sucks for people in the UK.
- Formerly known as TradeKing, Ally Invest is another penny stock broker with no minimum deposit required.
- $2,000 account minimum for margin accounts, giving people the chance to profit from short selling companies.
- Suitable for beginners traders new to stock trading and don’t have much money to invest.
- Commissions are low, $4.95 per trade is very competitive within the brokerage industry.
- User interface is appealing to users, making it faster and easier to execute trades.
- Charge a one-cent surcharge per share on stocks below $2.
- Regularly run promotions for new customers. Currently, they offer $500 worth of commission-free trades for clients who deposit $10,000.
- Trading platform and tools aren’t as advanced as the top online brokers but are improving slowly.
- Robinhood has quickly become the most popular broker among millennials.
- The start-up broker offers commission-free trades to millions of people around the world.
- While getting free trades may seem like a great deal, there is a catch. Executions will be slower than the industry standard, penny stocks are volatile and speed is crucial to make consistently profitable trades. More suited towards long-term investors.
- Despite the downsides Robinhood are great for first-time investors looking to gain experience and have fun.
- UI design is beautiful and easy to navigate.
- TradeMonster is a subsidiary of OptionMonster, owned by well-known financial commentators, Pete Najarian and Jon Najarian.
- Their parent company specializes in Options trading and set up TradeMonster to offer more diverse financial products to the market.
- In 2015, they merged with OptionsHouse and were later taken over by E-Trade.
- $0 account minimum required to open a cash account.
- $0.005 surcharge per share on stocks below $2.
- Not a good option for beginners.
- Degiro is a low-cost Dutch broker, only available to European investors.
- Low account minimum, €0.01 has to be deposited during the verification process.
- Limited selection of penny shares on their platform but they have ridiculously cheap fees.
- Good choice for traders in Europe as they find it challenging to find penny share friendly brokers. The majority of US brokers won’t accept customers from Europe or require a deposit of $10,000.
- Compensation scheme protects deposits up to €20,000.
Even though these companies have low minimum requirements, I advise picking the broker that suits your trading style.
James Kelly is my name and penny stocks are my game! Former day trader turned long-term investor with a decade of experience in the market. Over the years, I’ve joined dozens of trading services and I aim to provide honest reviews to help traders make better decisions!