Started looking into penny stocks but my current broker has terrible execution on these.
Most platforms seem to have high fees or poor fills when dealing with low-priced stocks. What brokers actually work well for this stuff without killing you on commissions?
TD Ameritrade handles penny stocks decent. No extra OTC fees.
Interactive Brokers works pretty well for penny stocks if you can handle their platform complexity. Their commission structure is reasonable and fills are usually decent.
Schwab is another option that doesn’t charge extra fees for OTC stocks, though execution can be slower during volatile periods.
Stay away from brokers that charge per share instead of per trade when you’re dealing with high volume penny stock positions.
Been trading penny stocks on and off for about 3 years now. The execution problem is real.
Charles Schwab worked best for me overall. Zero commission on OTC stocks and their fills are pretty consistent. Had way fewer partial fills compared to other platforms I tested.
Also tried Webull for a few months. Decent interface but their penny stock execution was hit or miss. Sometimes you’d get filled instantly, other times orders would just sit there.
One thing nobody mentions - check if your broker allows extended hours trading on penny stocks. Most don’t, but Schwab does for some OTC names. Helped me get out of a few positions that were tanking in pre-market.
Whatever you pick, definitely start small like someone mentioned. I learned this the hard way when a broker’s system glitched and filled my order at 20% above the ask price.
Fidelity lets you trade most penny stocks without commission. Just watch out for the bid-ask spreads on really thin ones.
Execution quality is your biggest concern with penny stocks, not just fees. Many brokers will give you terrible fills on these illiquid names. E*TRADE handles penny stock execution reasonably well. Their market makers provide better liquidity than most platforms for OTC stocks. Test any broker with small positions first. A broker that saves you $5 in commission but costs you $50 in bad fills isn’t worth it. Focus on platforms that actually get your orders filled at or near the quoted price.