Splitting Money Across Brokers
Many traders these days compensate with the lack of tools a discount broker provides by opening an account with a premium broker like ToS or ETrade Pro and utilizing the provided real-time data and tools. This guide is in assumption that you are using this strategy to obtain real-time charts. Here I explain how one can optimally split their funds across multiple brokers to take advantage of multiple day trades.
Tier 1: Less than $1000 - 1 Broker (3 Day Trades Weekly)
In this tier, it's not yet worth it to start paying commissions even if it's just $1 each way. The goal here is to grow your account and reach the next Tier so you can begin utilizing more day trades.
Tier 2: $1000 - $3000 - 2 Brokers (6 Day Trades Weekly)
In this tier you’ll want to keep it simple by splitting your funds down the middle between UST and RH. RH provides commission free day trades while UST is at a low cost of only $1 each way. This keeps your commissions within $6 a week.
Optional: After $2000 in capital fund $500 into SureTrader to take advantage of select plays/shorts
Tier 3: $3000 - $12,000 3 Brokers (9+ Day Trades Weekly)
Within this range you’ll have enough to open a margin account on ETrade taking advantage of shorts and 3 day trades a week through them. Not to mention the great tools they have to offer. You’ll be able to trade with your other two accounts on smaller size and less of a commission cost.
You can also opt for SureTrader instead of ETrade and do a 1/3 split across three brokers and gain access to unlimited trades. Always use SureTrader to make trades last due to higher commission costs.
UST (1/2 Remainder)
Robinhood (1/2 Remainder)
Etrade Pro ($2K+ Deposit)
UST (1/3 Split)
Robinhood (1/3 Split)
SureTrader (1/3 Split)
Tier 4: $12,000 - $25,000 3 Brokers (9+ Day Trades Weekly)
Within this equity range you’ll be saving a ton on commissions utilizing these three brokers with 3 day trades a week. Interactive Brokers is the most cost-effective premium broker for commissions. In this tier you’ll want to utilize IB for your larger position sized trades due to the fact that most of your capital will be here.
Robinhood (1/2 Remainder)
SureTrader (1/2 Remainder)
Interactive Brokers ($10K+ Deposit)
Tier 5: $25000 - $50000 - 1 Broker (Unlimited Trades)
It’s time to choose a premium broker and stick to just using one for convenience purposes. Commissions are higher at this point but we’re able to compensate with larger positions and better execution.
ETrade: Best known for their great PRO platform which includes premium level 2, customizable real-time charts, premium short list, chart trading hot keys, and real-time scanners.
Think or Swim: Best known for their custom charting and indicator tools.
Interactive Brokers: Best known for it’s execution tools, fair commissions, and premium short-list.
Robinhood: Best known for being commission free above $25,000
Tier 6: $50000+ - 1 Broker (Unlimited Trades)
Counterpoint Securities - Best short list, allowing you entrance into a realm of advanced trading strategies that involve shorting small caps, OTC’s and penny stocks.