We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free – so that you can make financial decisions with confidence. The offers that appear on this site are from companies from which TheSimpleDollar.com receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. The Simple Dollar does not include all card/financial services companies or all card/financial services offers available in the marketplace. The Simple Dollar has partnerships with issuers including, but not limited to, Capital One, Chase & Discover. View our full advertiser disclosure to learn more.
Best Day Trading Platforms of 2021
Disclosure: TheSimpleDollar.com has an advertising relationship with some of the offers included on this page. However, the rankings and listings of our reviews, tools and all other content are based on objective analysis. For more information, please check out our full Advertising Disclosure. The offers that appear on this site are from companies from which TheSimpleDollar.com receives compensation. All products are presented without warranty and all opinions expressed are our own.
Day trading is a fast-paced, high-risk and high reward form of stock trading that involves making multiple transactions on the stock market in one day. Because it’s a volatile form of trading that can cause massive gains as well as massive losses, day traders need the best day trading platform to make quick transactions and monitor market trends in real-time. To have the best chance at day trading success you’ll want to choose the best day trading platform.We used our proprietary SimpleScore methodology to make our recommendations on the best day trading platforms in several categories.
The best day-trading platforms of 2021
- TD Ameritrade: Best for Charting
- Robinhood: Best for Options Traders
- Interactive Brokers: Best for Advanced Traders
- Fidelity: Best Client Satisfaction
- Edward Jones: Best Full Service
- Chase : Best for Convenience
The best day-trading platforms at a glance
|Platform||J.D. Power Customer Satisfaction||Options and Futures Price||Other Investment Product Available||Mobile App Rating|
|TD Ameritrade||778/1,000||Options: $0 + $0.65 per contract||Stocks Options ETFs Mutualfunds Bonds Forex||3.85/5|
|Robinhood||N/A||Options: Free||Stocks Options ETFs Cryptocurrencies||4.55/5|
|Interactive Brokers||N/A||Options: $0 + $0.65 per contractFutures: Varies.||Stocks Bonds Options Futures Mutual funds ETFs Forex||3.55/5|
|Fidelity||790/1,000||Options: $0 + $0.65 per contract||Stocks ETFs Options Bonds Mutual Funds||4.7/5|
|Edward Jones||N/A||N/A||Stocks Bonds CDs Mutual funds ETFs UITs||2.7/5|
|Chase||772/1,000||Options: $0 + $0.65 per contract||Stocks ETFs Options Fixed income Mutual funds||4.6/5|
Data accurate as of July 27, 2020. Mobile app ratings are an average of Google Play and iOS Apple App Store ratings.
What is day trading?
Day trading is a trading style in which positions are opened and closed on the same day. It is a fast-paced type of trading, where traders are typically making their trading decisions based on the technical analysis of price action. In many cases, day traders also use margin to increase buying power and magnify their gains — and their losses. In order to be successful with day trading, it is necessary to develop a strategy that lays down the rules of when to buy and sell, as well as risk and money management strategies.
How day trading platforms work
At their most basic day trading platforms do one simple thing — they allow traders to buy and sell some asset, whether that’s stocks, currencies or commodities. So they will display the asset and its price, as well as the price to buy or sell, called the bid and ask.
Bid and ask
The bid is the most any buyer is willing to pay for an asset. The ask is the least any seller is willing to accept for the asset. The difference between the two is known as the spread. In general the smaller the spread is the more liquid the asset is. For example, roughly half of all currency exchanges are between the Euro and the U.S. dollar. By extension the EUR/USD spread is the lowest of all currency pairings.
In addition, there will be some way to specify how much to buy or sell, what type of order is being placed and a way to place the order.
Types of market orders
Market: An order to buy or sell immediately at the market price.
Limit: An order to buy or sell at a specific price to open a new position.
Stop or Stop Loss: An order to buy or sell at a specific price to close an existing position.
Once an order is placed and executed, the platform will track the purchase price and current price, letting the trader know their open profit or loss. The trader closes the position by selling the asset (or buying if the initial transaction is a short sale).
Short Sale: Borrowing an asset from the broker in order to sell it. Profits are made if the price of the asset falls, allowing the trader to buy it back at a lower price.
Commissions were once common for stock trades, and traders had to account for these commissions when determining if a trading strategy was profitable or not. Usually commissions were about $0.65 per trade. However, over the years these commissions slowly reduced as brokers used lower commissions as a way to differentiate themselves and attract more clients.
The real revolution in commissions occurred in March 2015, when online broker Robinhood launched as the first commission-free broker. By late 2019 major traditional brokers were all following suit and as of July 2020 there are few brokers who charge commissions on stock trades.
Day traders are also typically fast traders. In some cases they may open and close a position in a matter of minutes. And they could place dozens of trades in a single trading session. These fast trades typically generate small profits for the trader, which is why they will use leverage to increase the potential profits. It is also why so many trades need to be made. Making $1 on a trade isn’t so great, but if you place 25 trades in a single day and you leverage those trades by a multiplier of five or 10, you can make a decent profit.
How to choose the best day trading platform for you
- Know what’s important to you in a day trading platform. Is it speed of execution, education and trading resources, the ability to use margin, or something else? A good place to begin is with day trading reviews like the one you’re reading now.
- Narrow down the list of potential brokers. Start by checking the regulation of each broker as well as any insurance it offers on accounts. This is one way to begin to establish trust.
- Look at the fees and costs associated with each broker. This can include minimum deposit amounts, margin rates, costs for additional products and services, any commissions, the typical spreads, and account maintenance fees.
- Next, look at what current clients are saying about the broker. What do they claim are the best and worst features of the broker? Do client reviews differ from what the broker claims? This could be a red flag.
- Evaluate the remaining available brokers based on your criteria for what makes a good broker. You may need to make some compromises when choosing the broker. For example, speed of execution might be the most important thing to you, but you might choose a broker with slower execution speed in order to get proprietary market research and a more powerful trading platform.
- Once you’re down to two or three potential day trading platforms go ahead and take each for a test drive. Open a free account and test all the features you can get access to without making a deposit. Look at news feeds and research, see what’s available in charting features, find out what order types are available and whether there is a real-time price feed. Make sure the broker offers all the assets you want to trade.
- At this point you’ll likely want to choose the best day trading platform for you. Open an account if you haven’t already and make a small deposit. See how easy it is to make deposits and withdrawals to confirm you want to stay with the broker you’ve chosen.