For many investors, being able to screen for stocks and conduct research like a professional trader are key factors to consider when searching for an online broker.
That's why Research Tools and Investment Research — which includes stock reports, Wall Street buy and sell ratings, financial forecasts and more — made up two categories that rank highly in importance by respondents in IBD's fifth annual survey about online stock brokers.
Investors were asked to rate the importance of 24 broker characteristics, as well as their primary brokers' performance in each of the 13 most important categories. Based on the 2017 Best Online Brokers survey results, the investors rated Research Tools sixth in importance, with Investment Research just behind at No. 7.
The top three stockbrokers for the two categories were Fidelity, Charles Schwab (SCHW) and TD Ameritrade (AMTD).
Fidelity offers research tools including ETF Screener, which lets users quickly filter for exchange traded funds that best match their interests. For instance, if you're seeking a particular type of sector fund, you'd select Sector. You'll see the total number of available sector ETFs, as well as their net assets. You can further narrow the results by selecting criteria including objectives, performance, volatility and expense ratio.
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Let's say you already have a couple of ETFs in mind but aren't sure if they fit your criteria. No problem. Just click on the "Add My ETFs" and insert up to five names. The screen will appear at the top of your results list and show you how closely they align with the criteria you selected. You can save the screen so you could run it again later or to access it from a mobile device.
You can build a similar screen for stocks or start with a predefined screen from independent research experts. Fidelity offers more than 140 criteria to allow users to tailor their results for their specific goals. It provides investment research from more than 20 sources.
Charles Schwab's StreetSmart Edge trading platform gives users the research tools they need to help make informed decisions, including stock and ETF screens, advanced charting, pattern recognition and streaming news from providers such as the Associated Press and Thomson Reuters. Its Stock Screener helps users identify potential stock candidates by choosing a predefined screen such as Schwab "A" Ratings, Top Analyst Ratings, Near Price Highs and others. Those who prefer to tailor their own screens can select from a multitude of criteria including valuation, technicals and financial strength.
Schwab boasts a robust research offering that includes proprietary research from in-house experts, as well as reports from Briefing.com, Credit Suisse, Market Edge, Morningstar, Standard & Poor's and many others.
TD Ameritrade offers several trading platforms geared for different types of investors and a plethora of screens for stocks, options, mutual funds and ETFs. Clients can choose from predefined stock screens such as Strong Buys for a list of top-rated stocks on the Street, High Dividend Yield and RSI (Bullish) for stocks whose Relative Strength Index has crossed 30 and is rising.
Or they can create their own custom screen by selecting criteria to meet their desired traits for stocks, options, mutual funds and ETFs. The Omaha, Neb.-based company provides equity research from partners including Dow Jones, Morningstar, S&P Capital IQ and Thomson Reuters.
Last year it added a Social Sentiment feature to its Thinkorswim trading platform. This allows users to analyze social media sentiment — and how often companies' brands are mentioned — as another way to research stocks such as Amazon.com (AMZN), Apple (AAPL), Disney (DIS), Nike (NKE) and Starbucks (SBUX).
"This lens does not focus on what investors are saying about a stock in social media. It focuses on what consumers are saying about the products that the company makes," Nicole Sherrod, managing director of trading at TD Ameritrade, said in a news release. "Traders can analyze what people think of a core brand in the portfolio or they can look at a roll-up of all the brands."