With greater attention being paid to the trading of penny stocks more and more people are wondering what is the best penny stock broker. Many companies will do a fine job for you when it comes to penny stock trading but there are a few that do stand above the crowd. So what are the factors that you should be considering when choosing a penny stock broker.

The first thing that you will want to eliminate is any full service broker. Full service brokers are simply just too expensive to use if you are trading penny stocks. You are paying for an investment adviser when using a full service broker. Frankly, I believe if you are going to trade penny stocks then you need to be making your own trading decisions and not relying on someone else. Take responsibility for you own trading. So if you are not going to use their advice why should you be paying their high commission fees. The higher commission fees steal your profit away. So stay away from the full service brokers. Their branch managers will discourage their financial advisers from having clients that trade penny stocks. I know this from personal experience. I used to be a stock broker. At the very least you should keep your commissions below $10 for each trade. Some are even as cheap as $4 per trade.

Another big factor to consider when trading penny stocks is whether or not they can get shares to short. If you are not interested in shorting penny stocks then this is most likely not an issue for you. But if shorting penny stocks is a strategy that you follow or would like to explore further then you will need to find a penny stock broker that does a better job of this than others. One of the better brokerage companies in this area is Interactive Brokers. Most of the reviews I have seen about them have been very positive.

You will also need access to various trading tools and research. If you trade penny stocks then most likely you are highly dependent on charts. Make sure that your penny stock broker provides you with good charting tools. You may even want to see if they have some sort of scanning or query tool as well. If they don’t then you can use a service like StockFetcher which only costs $10 per month. Also make sure that they are giving you access to all of the fundamental research that you may want to do. Not many penny stocks are covered by analysts but if they are you will want a broker than provides some analyst reports are the stocks that you may consider trading.