Penny stocks are low-priced, high-risk investments. They can be a great way to get your feet wet in the stock market without dropping a ton of money, but if you’re not careful, you could lose everything you invest.
If you’re interested in learning more about penny stocks, check out our quick guide on how to get started and how to stay safe while trading.
If you’re ready to start trading penny stocks, here are some apps that can help.
Best Apps For Penny Stock Trading
Penny stocks are ultra-low-cost stocks that you can buy and sell for less than $5 per share. While the “cheap” share price means you can buy a large number of shares at a time, penny stocks tend to be quite risky. Because of that, many investors avoid adding penny stocks to their portfolios.
However, if you are undeterred by the risk and want to get into buying and selling penny stocks, it’s important to choose a brokerage and stock trading app that provides an easy, convenient, and cost-effective platform to trade from your computer or mobile device. These are the best penny stock trading apps for both penny stock beginners and experts.
Best Penny Stock Trading Apps of 2022
Best Overall: Charles Schwab
Runner-Up: Fidelity
Best for User Experience: TD Ameritrade
Best for Active Traders: TradeStation
Best for Tools and Resources: ETRADE Best Penny Stock Trading Apps Charles Schwab Fidelity TD Ameritrade TradeStation ETRADE
How Do Penny Stocks Work?
How Are Penny Stocks Different Than Normal Stocks?
How Do Trading Apps Work?
How Much Do Trading Apps Cost When Buying Or Selling Penny Stocks?
BEST OVERALL
Charles Schwab
Charles Schwab
OPEN ACCOUNT
Charles Schwab customers have access to trade penny stocks through multiple exchanges including over-the-counter markets (OTCQX/OTCQB), pink sheet stocks, and other stocks outside of the major exchanges.
It offers mobile and desktop apps with features that meet the needs of the vast majority of traders. J.D. Power ranked Schwab’s mobile app No. seven out of 16 brokerages in 2021.1 The mobile app lets you manage your account and trade stocks with just a few taps. When on your laptop or desktop, Schwab’s StreetSmart Edge platform gives you a Wall Street-style trading experience active traders are sure to enjoy.
With no recurring fees or minimums for the main Schwab brokerage account and no commissions for stock trades, penny stock enthusiasts may be able to enjoy a completely fee-free experience at Schwab.
Account minimum: $0
Account fees: $0
Online stock trade commission: $0
What We Like
$0 commission stock trades
No account minimums or recurring fees
Trade many OTC and pink sheet stocks
Great mobile and desktop apps
What We Don’t Like
Fees for phone ($5) and broker trades ($25)
RUNNER-UP
Fidelity
Fidelity
OPEN ACCOUNT
Fidelity offers desktop and mobile brokerage accounts with no minimum deposit, no recurring fees, and no commissions for stock trades.
When you’re on your laptop or desktop computer, Active Trader Pro is Fidelity’s flagship trading platform. The Fidelity mobile apps also make it easy to buy and sell penny stocks and handle most needs for your accounts. Fidelity’s trading integrates with Apple TV and Google Assistant, too. The broker has an app—Fidelity Spire—that guides your saving and investing goals.
Fidelity customers can access a large number of penny stocks. Be wary of the risk, though: Fidelity’s own website warns of the dangers of investing in penny stocks. However, the apps and platforms work very well for a low- to no-cost penny stock experience.
Account minimum: $0
Account fees: $0
Online stock trade commission: $0
What We Like
$0 trade commissions for stocks
No account minimum or required fees
Multi-platform app support across many devices
What We Don’t Like
The firm is strongly focused on funds and retirement investments
BEST FOR USER EXPERIENCE
TD Ameritrade
TD Ameritrade
OPEN ACCOUNT
Penny stock traders will enjoy a TD Ameritrade account with no minimums or recurring charges, no commissions for non-OTC stock trades, and the choice between multiple high-end trading apps for both passive and active traders. However, there is a $6.95 fee for trading over-the-counter (OTC) stocks, which could drive up the costs of your penny stock trading plans.
TD Ameritrade customers can choose between the traditional TD Ameritrade online experience and mobile app, and the premier thinkorswim experience. The regular TD Ameritrade app is great for beginners and passive investors. thinkorswim, available for both desktop and mobile, gives you arguably the best active trading experience of any major discount brokerage.
Charles Schwab acquired TD Ameritrade in late 2020, and it’s likely that TD Ameritrade platforms and Charles Schwab platforms will be combined into one in the near future.
Account minimum: $0
Account fees: $0
Online stock trade commission: $0
What We Like
Two trading platforms
No trade commissions or required account fees
What We Don’t Like
OTC trade fee of $6.95 per trade
Recently merged with Charles Schwab
BEST FOR ACTIVE TRADERS
TradeStation
TradeStation Logo
OPEN ACCOUNT
TradeStation is a brokerage designed for active traders, expert traders, and professional asset managers. It also offers a platform ideal for many penny stock traders. Both the TS Select and TS Go accounts are commission-free for stock trades made on mobile devices. However, TS Go clients will pay $10 per stock trade through TradeStation’s desktop platform. Most penny stock traders will want to go with a TS Select account, which includes access to mobile and desktop trading at no additional charge.
Commission-free trading applies to up to 10,000 shares per trade. Beyond that, you’ll pay $0.005 per share.
For traders happy with that pricing scheme, the TradeStation apps offer institution-level quality, free access to valuable data feeds, and a mobile experience that puts the power of many desktop apps in your pocket. This combination of tools allows you to do fast research and enter trades in just a few seconds with access to some of the best live-data available to any trader. For thin-margin penny stock trades, that could be the difference between losses and profits.
Account minimum: $0
Account fees: $0
Mobile stock trade commission: $0 ($10 desktop trades for TS Go accounts)
What We Like
Professional-quality trading platforms for desktop and mobile
Included access to advanced data feeds
Two account types
What We Don’t Like
Fees for stock trades over 10,000 shares
$10 commission for TS Go desktop trades
BEST FOR TOOLS AND RESOURCES
ETRADE ETRADE
OPEN ACCOUNT
E*TRADE offers commission-free stock trades and doesn’t have any minimums or activity requirements to avoid monthly fees. However, a $6.95 fee does apply for OTC stock trades. This goes down to $4.95 after 30 trades per calendar quarter.
The web, mobile, and desktop apps from ETRADE offer the features you’d expect from a trading platform. The desktop version, Power ETRADE, gives you a Wall Street-style experience. For mobile, you can choose between a pared-down version of Power ETRADE or the regular ETRADE app. Beginners and pros both have an E*TRADE mobile app to meet their needs.
In addition to multiple platforms, E*TRADE provides a plethora of useful articles and information — the “Knowledge” portion of the website is free to anyone, even those without an account.
In October 2020, Morgan Stanley acquired ETRADE. According to ETRADE, customer experience will remain largely the same as it was pre-acquisition.2
Account minimum: $0
Account fees: $0
Online stock trade commission: $0 (up to $6.95 for OTC stock)
What We Like
Beginner and advanced mobile apps
Experience with online trading since the 1980s
No fee account with no minimum balance requirements
What We Don’t Like
$6.95 commission for OTC stock trades
Acquisition by Morgan Stanley may change things for customers in the future
How Do Penny Stocks Work?
Penny stocks work the same way as other stocks as they are publicly traded. The differences are that you may not always find a buyer when you want to sell your stock, and you may not have the same level of information or history to base your investment decisions on if you’re buying a low-cost penny stock. Penny stocks are generally riskier than other larger stocks, but no stock market investment is a guaranteed thing.
How are Penny Stocks Different Than Normal Stocks?
Penny stocks are normal stocks, except they cost less than $5 per share. Many experts consider these stocks to be riskier due to organizations that tend to be selling at these rates, which are less proven or experienced businesses. Penny stocks tend to have much less information for investors to make purchase decisions on, which means that if you buy and decide you want to sell later, you could struggle to find a buyer.
A valuable stock’s normal course tends to be that a company will prove out their business model quite substantially before they enter the public markets. However, most penny stocks go public before they’ve gone through their hopeful growth stage, which typically leads to fewer of these businesses ever becoming successful later.
How Do Trading Apps Work?
Trading apps operate as an online platform for investors to buy and sell publicly traded assets. These apps typically come with a robo-advisor that can make investment decisions for you if you’re looking for more long-term investments.
A trading app is a quick way to make buying and selling decisions and complete the trades when you need to—before the value goes down. This is especially important when investing in penny stocks because you’ll want to squeak out all of the profit you can when the stock’s value increases.
How Much Do Trading Apps Cost When Buying or Selling Penny Stocks?
The costs of using trading apps to buy and sell penny stocks vary by the broker or app you’re using and what you’re trying to buy or sell. Generally, the best trading apps won’t cost you anything for basic stock trading or access to your overall investment account profile.
However, as you get into more sophisticated trading or decide to use other brokers, you’ll be charged up to 1% of the investment value when you buy or sell stocks. Be mindful of any account minimums that your trading app requires before deciding which one is right for you.
best penny stock app for beginners
The best trading platforms for beginners all offer three essential benefits. First, the platform itself should be easy to use and beginner-friendly. Second is the provision of a variety of educational materials to get new investors off to a strong start. And third, the best platforms deliver access to quality stock market research.
For our 2022 Review, we tested and scored 15 trading platforms, focusing on features that are essential for beginning investors. In addition to in-depth testing of each learning center, we looked at which brokers offer unique features like webinars, live seminars, videos, progress tracking, paper (or virtual) trading and interactive educational elements such as quizzes.
Best Trading Platforms for Beginners 2022
StockBrokers.com 2022 Review
Here are the best online stock trading sites for beginners:
Fidelity – Best overall for beginners
TD Ameritrade – Excellent education
E*TRADE – Best for ease of use
Merrill Edge – Best client experience
Webull – Best investor community
Fidelity Logo
Overall
Summary
Review
Pros/Cons
Best overall for beginners
Minimum Deposit $0.00
Stock Trades $0.00
Options (Per Contract) $0.65
Fidelity is a winner for beginners, thanks to its plethora of educational resources that includes a Learning Center stocked with videos, infographics, and even podcasts. Fidelity also offers an innovative Youth Account – a first-of-its-kind brokerage account for teens aged 13 to 17. Read full review
Pros
Excellent mobile app for investors
Our top pick for order execution, no payment for order flow (PFOF)
Cons
Margin rates can be higher than those of peers
Mobile app may fall short for active traders
TD Ameritrade Logo
Overall
Summary
Review
Pros/Cons
Excellent education
Minimum Deposit $0.00
Stock Trades $0.00
Options (Per Contract) $0.65
TD Ameritrade delivers $0 trades, fantastic trading platforms, excellent market research, industry-leading education for beginners, and terrific customer service. Read full review
Pros
Excellent education for beginners
thinkorswim platform suite is our top desktop platform for 2022
Futures and forex trading available
Cons
$6.95 fee per trade for penny stocks
No access to international stock markets
E*TRADE Logo
Overall
Summary
Review
Pros/Cons
Best for ease of use
Minimum Deposit $0.00
Stock Trades $0.00
Options (Per Contract) $0.65
Earning a recommendation based on its trading platform alone, ETRADE is great for any beginner stock trader. Power ETRADE is easy to use and offers features including paper (practice) trading and note-taking. Its educational content, though plentiful, can be a challenge to navigate. Read full review
Pros
Power E*TRADE offers great selection of trading tools
Our top pick for mobile trading and ease of use
Cons
$1,000 minimum for streaming data
Range of educational materials is limited compared to peers
Merrill Edge Logo
Overall
Summary
Review
Pros/Cons
Best client experience
Minimum Deposit $0.00
Stock Trades $0.00
Options (Per Contract) $0.65
Merrill Edge offers $0 trades with industry-leading research tools (especially ESG research) and customer rewards. Learning about investing is a pleasant experience, thanks to excellent organization, quality and in-house curated content. Read full review
Pros
Excellent tools for ESG research
Robust rewards program for Bank of America customers
Cons
Penny stocks and OTC securities are not available
Fractional share trading is not available
Webull Logo
Overall
Summary
Review
Pros/Cons
Best investor community
Minimum Deposit $0.00
Stock Trades $0.00
Options (Per Contract) $0.00
Webull offers a unique community experience and easy-to-use trading platforms that will satisfy most young investors. Its educational materials, however, are lacking compared to leaders in this area. Read full review
Pros
Easy-to-use trading platforms
Offers cryptocurrency trading
Cons
Trails the best brokers in trading tools, research and education
No phone support offered
Other Trading Platforms
In addition to our top five trading platforms for beginners in 2022, we reviewed 10 others: Ally Invest, Charles Schwab, Firstrade, Interactive Brokers, J.P. Morgan Self-Directed Investing, SoFi Invest, TradeStation, Tradier, Robinhood and Vanguard. To dive deeper, read our reviews.
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Best Platforms for Beginners: Pricing Comparison
Here’s a comparison of pricing across Fidelity, TD Ameritrade and E*TRADE. For more comparisons, use our online broker comparison tool.
Feature Fidelity TD Ameritrade E*TRADE
Minimum Deposit $0.00 $0.00 $0.00
Stock Trades $0.00 $0.00 $0.00
ETF Trade Fee $0.00 $0.00 $0.00
Mutual Fund Trade Fee $49.95 $74.95 $19.99
Options (Base Fee) $0.00 $0.00 $0.00
Options (Per Contract) $0.65 $0.65 $0.65
Futures (Per Contract) N/A $2.25 $1.50
Broker Assisted Trade Fee $32.95 $25.00 $25.00
Best Platforms for Beginners: Education Comparison
Here’s a comparison of the most popular educational features offered by beginner trading platforms. To compare 150+ features and fees side by side, check out our online broker comparison tool.
Feature Fidelity TD Ameritrade E*TRADE
Education (Stocks) Yes Yes Yes
Education (ETFs) Yes Yes Yes
Education (Options) Yes Yes Yes
Education (Mutual Funds) Yes Yes Yes
Education (Bonds) Yes Yes Yes
Education (Retirement) Yes Yes Yes
Retirement Calculator Yes Yes Yes
Investor Dictionary Yes Yes Yes
Paper Trading No Yes Yes
Videos Yes Yes Yes
Webinars (Monthly Avg) 115 500 30
Webinars (Archived) Yes Yes Yes
Progress Tracking Yes Yes No
Interactive Learning – Quizzes Yes Yes Yes
Which online broker is best for beginners?
Based on our extensive testing, Fidelity takes the top spot this year as the best all-around choice for beginners, due to its fantastic ease of use and top rankings in education and research. Add in the option to trade fractional shares and its unique youth account offering (which captured our innovation award), and we have a winner.
Fidelity mobile home page Fidelity mobile account watch list detail Fidelity mobile trade ticket Fidelity mobile charting Fidelity account stock quote Fidelity account mutual fund quote page Fidelity stock chart Fidelity YouTube financial market insights playlist
Which trading platform is best for beginners?
The best trading platform for beginners is Power ETRADE. ETRADE offers Power ETRADE as both a browser platform and mobile app. The availability of paper trading, as well as HTML5 charts with automated technical analysis and screening tools for both stocks and options, make Power ETRADE an excellent option for beginners.
Best trading platform beginners Power ETRADE Best trading platform for beginners Power ETRADE watch list Best trading platform for beginners Power E*TRADE options analysis
What is the best stock trading app for beginners?
For beginners, our favorite trading apps are Fidelity and TD Ameritrade. Fidelity provides the best market research and stock analysis, alongside an in-depth learning center.
TD Ameritrade offers the most comprehensive selection of trading tools, and provides access to its entire educational video library for beginners, which is easily navigable by topic.
Fidelity mobile home page Fidelity mobile account what you are watching Fidelity mobile trade ticket TD Ameritrade mobile watchlists TD Ameritrade mobile trade ticket TD Ameritrade mobile education how to videos
How do I start trading for beginners?
To start trading as a beginner you must have a brokerage account, an investment strategy and an expected time horizon that you plan to hold. Scan the market for trading ideas while taking baby steps to size your trades appropriately.
Trading platform: A demo or virtual account from a broker is a great way to learn the trading software you are using and understand how order types can help you manage risk while entering and exiting positions.
Trading strategy: After opening a brokerage account, there are several decisions you will need to prepare for when trading as a beginner, such as what to trade and when to trade it, and how much money to budget.
Time frame: Whether investing for the long term as a passive investor or trading more actively, you must focus on present market conditions and recent price activity when deciding how long you want to hold.
Baby steps: Fractional shares are another way to ease your way into the world of stock trading while taking less risk, allowing you to focus on percentage returns before taking steps to increase your trading budget.
Interested in more stock trading education? Dive deeper with StockTrader.com’s 10 Great Ways to Learn Stock Trading .
How do beginners trade stocks?
Here are common steps for beginners when learning how to buy stocks online:
- Account setup: Open a self-directed brokerage account.
- Navigate platform: Learn how the trading software works (website, mobile app or desktop).
- Budget: Decide on a monthly amount you can afford to risk.
- Strategize: Develop an investing style, such as buy and hold or short-term trading.
- Manage risk and reward: Incorporate rules using order types (stop and limit orders).
- Set goals: Focus on percentage returns and decide on your time horizon.
- Find stocks to trade: Analyze news and research to find investment opportunities.
- Avoid concentrated positions: Don’t put too much into a single position.
- Index funds: Consider incorporating low-cost index funds such to gain broad market exposure.
How do you buy stocks online?
To buy stocks, first, you need to open and fund an online brokerage account. Next, research which stock you want to buy. Last, go to the order ticket, enter the stock symbol — along with the number of shares — you want to buy, then place your trade.
What is paper trading?
Paper trading, or virtual trading, is a trading platform feature that enables the trading of stocks, ETFs, and options with virtual currency (fake money). This helpful learning tool is popular with beginners and is a great way to practice stock trading without risking real money. The two top-rated brokers that offer paper trading are TD Ameritrade and E*TRADE.
What are fractional shares?
A fractional share is a portion of a full share of a publicly-traded company. Fractional shares enable investors with smaller budgets buy a stake in companies with high stock prices. For example, instead of spending over $3,000 to buy one Amazon (AMZN) share, a trader could purchase a $100 fractional share – and then own a proportional fraction of that share (in this example, roughly 1/30th of a share). Fidelity, Charles Schwab, Interactive Brokers, Webull, SoFi Invest and Robinhood offer fractional shares.
What is a market order?
A market order is an order to buy or sell a security (such as a stock) at the current best-available market price. Market orders are the most common type of order, as they are the fastest and easiest way to buy and sell shares.
What is a limit order?
A limit order is an order to buy or sell a security at a pre-specified price or better. Since limit orders are fixed to a pre-specified price, they will only fill when the limit price is reached. Limit orders are best when you know the exact price at which you want to buy or sell a stock.
Is online trading safe?
Online trading is safe if you use a regulated online stock broker and never invest more than you are willing to lose. Trading stocks online is inherently risky. Start with a small amount of money, read investing books, and keep it simple by buying and holding for the long term rather than trying to time the market.
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Read Next
Explore our other online trading guides:
Best Trading Platforms 2022
Best Online Brokers for Beginners
Best Day Trading Platforms
Best Brokers for Penny Stocks
Compare Online Brokers
Also explore educational content for various topics at our sister sites :
10 Great Ways to Learn Stock Trading – StockTrader.com
Best High-Yield Savings Accounts – Investor.com
Top Financial Advisor Firms – Investor.com
Best Forex Brokers for Beginners – ForexBrokers.com
Methodology
For the StockBrokers.com 12th Annual Review published in January 2022, a total of 3,075 data points were collected over three months and used to score 15 top brokers. This makes StockBrokers.com home to the largest independent database on the web covering the online broker industry.
As part of our annual review process, all brokers had the opportunity to provide updates and key milestones and complete an in-depth data profile, which we hand-checked for accuracy. Brokers also were offered the opportunity to provide executive time for an annual update meeting.
Our rigorous data validation process yields an error rate of less than .001% each year, providing site visitors quality data they can trust. Learn more about how we test.
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About the Author
Blain Reinkensmeyer
Blain Reinkensmeyer
As Head of Research at StockBrokers.com, Blain Reinkensmeyer has 20 years of trading experience with over 1,000 trades placed during that time. Referenced as a leading expert on the US online brokerage industry, Blain has been quoted in the Wall Street Journal, The New York Times, the Chicago Tribune, and Fast Company, among others.
Chris McKhann
Chris McKhann
Chris McKhann has been in the industry for more than 20 years. He has worked for many of the top names in the online trading space, including TD Ameritrade and optionMONSTER, which later became part of E*TRADE. His work has been cited in the Wall Street Journal, Reuters, the Financial Times, Forbes, CNBC, Nasdaq.com and Nikkei. He has also been an advisor and outside trader for several hedge funds. He was one of the first traders to delve into the VIX tradable products and to write about them (back in 2006). Chris is also an educator who teaches high school statistics, finance and computer science.
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