The first decision you have to make as a part-time investor is, surprisingly, not where to put your money, but whom to invest with. Although often overlooked, the choice of brokerage is not to be taken lightly and requires careful planning and evaluations of all options.

While this may sound complicated and, indeed, it can be a lengthy process, but it doesn’t always have to be. Once you have a clear direction and goals in mind, the rest will just fall into places on its own. In order to let them fall into places, though, you will have to be ready first.

Before start looking at brokers, first ask yourself what are your goals and what type of investor are you? Now, there are many investing styles that each have loyal followers all over the world, but for a beginner, that’s not something you should be concerned with for now. Simply ask yourself: How often do I plan to be making trades? In other words, will you be the “buy and hold” investor, who sits on investments for years and even over a decade; or the “active trader”, who follows the market closely and makes trades based on new information and other factors?

Once you have the answer to that, then it’s time to pick a broker. Here are five tips that can help you make this process as simple as possible.

1.       Know your deal

You’ve now decided that you would be trading around x times a year, that’s great. Now think about what do you expect from your broker. A full service broker will provide you with more services than a discount broker, including but not limited to, company researches, one-on-one advice…etc. But as you can already tell by the name, a full service broker will also charge a higher commission.

2.       Product selection

Not all brokers offer a wide range of investment alternatives. If you are trying invest in different financial instruments at the same time, it would definitely make things easier to have a broker that offers more than just the stocks and bonds.

3.       Platform and tools

As a part-time investor with a full time job and often a family to spend time with, the flexibility of accessing your account from anywhere with stable internet connection is essential. Today, almost all brokers have their own trading apps for phones, PCs, and iPads in addition to the web page. Take a look at the UI of their apps to see if that’s something you are comfortable with, and see if there’s any additional tool that they offer in the trading app, for example, CMC Markets has a client sentiment tool that provide near real time information on market sentiments.

4.       Customer service

Of course, you want to choose a broker that is the least likely to make any mistakes, but that doesn’t mean you shouldn’t prepare for the worst. You will need a broker that provide fast and easy access to customer service or help desk. Call up the customer service and find out how fast or slow you can get to a real person that you can speak to should anything go wrong.

5.       Cash on cash

You will probably want to leave some cash in your trading account before starting a position or exiting one. Some brokerages offer some small interest on your cash, while some offer nothing at all. This could make a huge difference on your decision making for future trades. If this information isn’t available on the broker’s website, make sure you get in touch with them and get the information.

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