I love new traders’ enthusiasm…
They’re so excited to learn this new skill and start making money. So they rush to open a brokerage account and they think they’re ready to trade.
But in reality, they don’t know the patterns and price action to look for…
But even worse, they don’t even know how to use their brokerage account or even their platform.
So today I’m going to help you with some of those tricky situations traders can find themselves in with their brokerage accounts…
By answering your questions here!
Broker Q&A
I get a ton of questions about brokers in my live YouTube videos and in the SteadyTrade Team. So today I’m answering a few that I see the most often.
Remember that this just scratches the surface of what there is to know about brokers, order types, and having the right tools and platform — so always do your research.
It’s worth it in the end to have a product and service you’re happy with.
Q: Why Won’t My Premarket Order Execute?
A: There could be a number of reasons for this. Some could be related to your broker, other reasons could depend on the stock you’re trying to buy.
If you’re trying to buy a stock that has no premarket volume, that could be one reason your order isn’t executing. Another is if you’re trying to buy an OTC stock. They don’t trade in premarket or after hours.
Now onto broker-related issues … First, when you open a broker account there is paperwork you need to fill out to be able to trade outside of market hours.
Second, some brokers restrict trading on stocks they view as too volatile or risky.
Third, in order to execute a trade in premarket or after hours, you have to use the right order type. Instead of using a market or limit order, you must select good until extended market (it’s sometimes shortened to GTEM).
You also might have to change your order route from auto to ARCA.
Q: Why Did My Broker Lock My Account?
A: Again, there can be more than one reason for this…
The most common reason that affects new traders with small accounts is that they broke the PDT rule. If you’ve executed more than your three-day trades in a five-day period, your broker will lock your account.
The length of the lockout can vary from broker to broker. But it can be for up to 90 days.
See how you can get around this rule here.
But be careful trying to skirt the rules … If you use a cash account, a broker can also lock an account if you try to execute trades before your cash is settled from a prior trade.
Q: Which Broker Do You Recommend?
A: You should put some research time into choosing a brokerage account that’s right for you.
Personally, I like Interactive Brokers. But if you want to short-sell, you’ll want a broker like TradeZero that has good borrows.
If you’re trading with a small account, you might be more worried about brokerage fees that can eat into your profits.
Choose the best broker for your small account here.
Figure out what’s most important to you, then dig into research to see which broker lines up with your priorities.
And if you don’t find out what you want to know online — call their customer support.
You never know, great customer service could be the deciding factor for which broker you’ll choose.
And always remember that they work for you. If you don’t like something they’re doing, you don’t like your fills, or they have horrible customer service when issues arise — you can always choose another one.
Don’t be afraid to shop around.
And when you have your account set up and you’re ready to trade — don’t forget to get a mentor to show you the ropes.
I’m here for you every morning!
Have a great day everyone. See you all back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade