Advanced Trading Platform

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Day traders earn their living by entering and closing out multiple trades in a day in pursuit of profits. This strategy requires fast and reliable trade execution, the lowest possible commissions and access to customer service when things go awry.

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Forbes Advisor evaluated a broad selection of platforms in order to help you choose the best online brokers for day trading. Our side-by-side tests placed the greatest importance on low commissions and fees, best-in-class platform and technology and highly responsive customer service to find the best trading platforms available.

Interactive Brokers earned the top spot in our listing thanks to its powerful Trader Workstation platform, easy access to a vast selection of global markets and rock-bottom trading commissions. These features and more make Interactive Brokers the preferred trading platform for professionals at hedge funds and investment firms.

Interactive Brokers stands out by charging substantially lower fees than its rivals in several areas. Its IBKR Pro tiered pricing plan offers better rates for direct access trading than other leading trading platforms for professionals. We also noted lower commissions for futures trading, and the lowest margin rates among the platforms we surveyed.

We were impressed by the flagship Trader Workstation platform and the quality of order execution. Trader Workstation offers highly customizable alerts, watchlists and sophisticated charting. It features advanced order types. Traders can stay on top of the news with the latest reports from Reuters, Dow Jones and a variety of other sources on the platform.

Quality of order execution is of paramount importance to day traders. Direct market access is available for both stocks and options, allowing traders to decide how they want their orders to be routed.

To facilitate optimal order execution, Interactive Brokers created a software product called Smart Routing, which continually scans competing markets and automatically routes orders directly to the best ECN or market center.

Short selling is a key strategy deployed by day traders. Cobra Trading is geared toward the needs of professional day traders in the equities and options markets. It also offers futures trading through its Venom Trading division. Cobra Trading offers a strong range of platforms, competitive commission rates and reliable customer support.

One area where Cobra Trading stands out is in making it easy to short sell low-priced securities and penny stocks. Easy to Borrow (ETB) lists are regularly updated by brokerage firms and made up of highly liquid stocks that can be sold short immediately. However, some stocks favored by day traders are not so readily available for short selling. These are often small cap or penny stocks that are attractive in part because they are highly volatile.

Cobra Trading has access to multiple locate sources, including those of their clearing firm, Wedbush Securities, which has free HTB (hard to borrow) locates. Locate sources are the various securities lending firms where clients can locate and borrow hard to borrow shares. The DAS Trading platform offered by Cobra Trading has a locate monitor window where you can check inventory from numerous different locate sources. Having multiple sources gives traders a better chance of being able to find the shares they may be targeting for selling short.

In the world of day trading, a split second can make the difference between a profitable trade and a loss. As its name suggests, Lightspeed Trading has worked hard to ensure that customers can execute their trades and receive market data as rapidly as possible, with a tight focus on serving professional and institutional traders.

The Lightspeed Trader platform has been stripped down to focus on data and order execution, without unnecessary bells and whistles. The platform is ultra-low latency, highly stable and intimately customizable. The technology and features of Lightspeed Trading are designed to enable traders to seize market opportunities lightning fast.

Time and sales data and Level 2 quotes are available for both stocks and options. The platform has a short location feature that indicates whether a stock is easy to borrow for short trading, would require extra effort to locate or is not available at all for borrowing. The Social Sentiment tool leverages data from Twitter and social media to capture financial market sentiment about a specific security.

As a direct access broker, customer orders can be routed to over 100 destinations, including exchanges, market makers and dark pools. Orders can be configured and executed efficiently with keyboard shortcut hot keys. Charts are also optimized for speed.

Lightspeed performed well in our customer service tests. We were able to quickly reach a representative and were not left on hold. The Lightspeed team offers personalized support, and clients can choose to be assigned an account representative to work directly with them.

New account promotions are sometimes offered, such as a three-month special in which clients get a 50% rebate on their commissions. After three months, a lump sum in cash is given for half of the commissions generated.

Founded in 2003, Cobra Trading is geared toward professional and institutional traders. In our tests, customer service was very good across the board. We received fast, helpful responses via phone, email and human chat. Unlike the larger firms, there is no need to navigate various automated menus before reaching a live representative.

The human-operated chat is very convenient and something that rival Lightspeed Trading lacks. All of the customer service agents at Cobra Trading are licensed professionals, many with substantial trading industry experience.

The TradeStation desktop platform lets day traders back-test, optimize and fully automate their trading strategies in the stock and futures markets. Trading strategy back-testing can draw from over 50 years of historical daily price data.

The TradeStation platform makes it easy to test strategies across different time frames and provides a wealth of statistical data in the performance report, including key metrics such as profit factor and maximum drawdown.

For day traders in general as well as day traders who want to find information that may require sophisticated searches, TradeStation has good educational materials on how to create applications using EasyLanguage, a programming language designed for traders.

When testing brokerages, we looked for tools specifically helpful to day traders, like advanced charting and order types, and rapid trade execution. In our customer service tests, we measured the time it took to get a response over the phone, by live chat and by email. We also took into account how well informed and helpful the representatives were and whether they held relevant financial licenses.

Day trading is a strategy employed by professional traders to profit from short-term price movements in stocks and other securities. The name of the strategy is key: Day traders enter positions with the intention of getting out on the same day.

Day trading requires a solid understanding of the market, risk management strategies and a disciplined trading plan. Research and planning are absolutely essential for successful day traders. It only works if traders pay close attention to these factors:

A day trader can have a majority of winning trades, but still lose money at the end of the day if their commissions outweigh their profits. Since day traders are continually buying and selling assets, they may rack up substantial costs in the form of trading commissions.

Since fast trade execution is essential for day trading, professionals prefer online brokers that offer direct access to markets. Direct access brokers allow traders to directly route their orders to specific exchanges, electronic communication networks (ECNs), market makers and dark pools. The freedom to choose how orders are routed can provide access to more liquidity and faster execution.

When stock, bond and ETF commissions are zero, that suggests that an online brokerage is being paid third-party commissions to route order flow to specific middlemen. This typically results in slower trade execution, but it allows for those attractive $0 commissions.

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