WHICH ONLINE STOCK BROKER IS THE CHEAPEST?

In 2011, the lowest stock broker fees are found at OptionsHouse. Just $3.95 per stock trade is the cheapest price I could find of any of the online discount stock brokers.

As you can see buy their name, they specialize in trading options which are different than stocks. Beginners won't want to get involved with options until they learned a lot about the basics of stocks and the market. However, just because they specialize in options doesn't mean that they don't have a great platform for regular stock trading.

With OptionsHouse, your money is protected by SIPC just like it would be for any other online discount broker. They have an A- Rating from the BBB and they have won several awards from Barron's as well. In short, your money is safe with OptionsHouse even though they give you the cheapest stock trades.

At $3.95 per stock trade, you are getting a price that is less than half of what several of the more famous online brokers charge like E*Trade, Schwab, and TD Ameritrade. You are also getting a much better price than brokers like Scottrade ($7) and Firstrade ($6.95).

If you are looking for the cheapest stock trades online, OptionsHouse is the place to go. I personally don't use them because I have used E*Trade for years and I don't want to go through the hassle of switching. I usually don't make more than 10 trades per year though so my extra cost is not too great. However, if I were an active trader I would seriously think about switching because the money I could save with the cheaper trades from OptionsHouse would be significant.

STOCKS GO UP, DOWN, UP, DOWN

Things seem to have stalled here lately in the stock market and we are seeing it go up one day and then right back down the next. You can see what I mean by looking at the 1 month chart of the Dow below:

There are many reasons for this up and down movement but what it probably signals the most is that investors are getting a little nervous. The market has moved up very steadily for about a year now all the way from it's low last year of just under 7,000 to over 11,200 a day or two ago. When the stock market continually goes up and back down for a period of time like it has it can mean that the steam has run out of the rally and investors are really torn at what to do. When people are selling one day, buying the next, and then selling the day after, it can mean there is a lot of confused people out there and a lot of differing opinions.

You can read Jim Jubak's opinion of the matter where he likens it from the mood changing from a half full glass outlook to a glass half empty outlook. Stocks just don't keep going up forever and there is always something around the corner that can stall momentum. The financial shenanigans in Greece seem to have helped make investors very nervous in a market that was already very high.

Why do stocks go up one day and down the next? Well, as I have written about before, the market moves on people's perceptions of what is happening and what they think will happen. It is all about whether people see positive or negative things in the future and right now it looks like there is possibly more negative than positive out there.

The Obama administration has this country in more debt than most people realize and that could become very troublesome down the line. If foreign investors start pulling out of America and don't buy up our ever increasing debt, where will that leave us? No stock market can withstand something like that.

This Stock Market For Dummies blog wonders whether it might be time to start selling a stock or two just in case? Maybe it is time to move some money out of stocks and put it into something safer for a while? The problem is that once you sell and get out it is very difficult to figure out when to buy back in again. However, maybe some safety is a good direction to go right now?

HOW TO FIND GOOD STOCKS TO BUY FOR DUMMIES

One of the most difficult things any stock market dummy or veteran has to do is to find good stocks to buy. Figuring out how to buy stocks for beginners is relatively easy and something you only have to learn once. Figuring out what stocks to buy, on the other hand, is a decision that has to be made over and over for the rest of your life.

There is no shortage of opinions on TV business shows and magazines from the stock gurus. Jim Cramer and his type on TV always have a list of stocks they say you should buy. In my experience, their choices are no better than the ones I can make myself by throwing a dart at a dart board. For instance, how many stock gurus warned us to pull all our money out of stocks when the Dow was in the 14,000's? Some experts might have been cautious but no one saw anything as bad as what really happened.

So, where can you find trusted opinions of what stocks to buy? One good choice seems to be Morningstar. Morningstar is one of the most respected names in independent investment research and opinion, as well as the recognized leader in stock and mutual fund analysis. Their mission is to create great investing products to help people reach their financial goals.

Consistently ranked among the best investment sites on the web, Morningstar offers a wide range of online portfolio management tools, financial data, unbiased stock and fund analysis, video commentary, and more.

There is one reason above all others that I like Morningstar. Pat Dorsey is a stock analyst who both writes and does video analysis of the stocks he deems worth investing in. As a conservative investor, I like to listen to those experts who are not afraid to say they do not like a stock's potential and that they recommend not investing in it. Pat Dorsey is someone who often says "no" to a stock and many of his picks are conservative in nature. By contrast, many of his colleagues seem to be positive about almost everything which really provides no value to any stock market beginner trying to come up with some good stock picks.

Morningstar and Pat Dorsey is one source that should be considered when putting together a list of best stocks to buy right now. Their website is comprehensive and will provide good value to both stock market beginners and stock market veterans alike. Of course, when you are trying to find stocks to buy you should do as much research on your own as possible and get several opinions as well.

HOW TO CHOOSE A DISCOUNT STOCK BROKER

One of the things that is very confusing for stock market beginners is how to choose an online discount stock broker. If you go to Google and search for them, there are dozens that come up. If you watch the television business news, you will see many of them advertise. How can you possibly know which one is right for you?

There are subtle differences between these discount stock brokers but for the beginner, most of these differences are not important. It is unlikely that you will ever need some of the services and differences that they offer, at least not for a while. Stock market beginners need to keep things simple which means finding an online broker that has a good, clean, easy to understand and navigate website as well as competitive prices.

You will be protected equally by law no matter which online stock broker you choose. Your accounts will be guaranteed up to $250,000.00 (just up from $100,000.00) and everything else that is basic will be virtually the same. You may find differences in prices as some offer trades as low as $4.95 while others may charge $9.95 or $12.95. Just because one online stock broker is cheaper doesn't mean it is any less reputable than another that charges more.

One thing to look out for is hidden fees. Stock market dummies as well as seasoned traders always need to read the fine print. Hidden fees and miscellaneous charges are tactics used by some of the discount stock brokers to raise their bottom line. Other differences may include things like being able to write checks from your account, short trading, and free trades if your order is not executed within a certain time period.

A big difference between each online discount stock broker is the website layout. Each company will of course use it's own software and some are more easy to understand and navigate than others. For instance, I love the E*Trade website as it is so easy to find your way around and find the information you need. The H&R Block website, on the other hand, seems archaic compared to E*Trade's and I always get irritated when I go on it as it will not allow me to easily find certain things. Unfortunately, you may not be able to fully test the website of a prospective stock broker before you open an account.

There is no right or wrong way of how to choose a discount stock broker. If you are a stock market beginner you will probably want to start with one of the better known ones who fall on this list:

TD Ameritrade
E*Trade
Scottrade
Charles Schwab
Zecco
First Trade
T. Rowe Price
ShareBuilder
Options Xpress

A BEGINNERS GUIDE TO STOCK DIVIDENDS

What are stock dividends? In this time of market crisis and uncertainty in 2008 – 2009, many stock experts are suggesting buying stocks with dividends and holding them until there is a recovery. One of the reasons for this is because it is difficult to find an alternative such as a high yield certificate of deposit. At least with a stock that pays a dividend, you are getting a small return with the hope that the stock will go up when things get better.

Not all stocks pay a dividend and most that do are under 1%. With some careful research though, you can find stocks that pay a higher dividend. What the stock gurus are saying is that you might find stocks that pay a reasonable dividend and buy those instead of stocks without dividends.

A company stock may pay a dividend for many reasons but the most common one is that they want to return something to their investors. Some companies, like Microsoft, may have a lot of cash and decide to give some of it to their investors in the form of a dividend. Other companies might need all their cash for research and development and not pay a dividend. Tech stocks are notorious for not paying out dividends.

No stock dividend is guaranteed safe. Any time a company gets in trouble, the first place they go the cut costs is their dividend if they have one. Therefore, even if you find a stock with a great paying dividend, you cannot buy that stock and be able to count on it. Especially now in these troubled times, stock dividends are in trouble across the board.

Some dividends are safer than others because of the financial position of the company. If a company is doing well, the dividend is probably safe and will not be reduced. Companies like to have a record of increasing their stock dividends but this is not always possible, especially in dire times like these. The stock market for beginners is now a rough place to get started but buying stocks with dividends is a good place to start. You need to do the research and find out what companies are doing all right and pay a nice healthy dividend. If you buy this type of stock, even if it goes down the dividend minimizes the losses.