Their costs may be about half as much as traditional full-service brokers. Discount brokers generally don't have local branch offices or offer as many services. Their commissions may be about a third as much as full-service brokers. Deep discount brokers execute orders only and offer few services. They often charge a flat fee for a trade of any size.
Online brokers are similar to deep discount brokers but are Internet based.
People use online brokers because it is so easy to make stock purchases with a click of the mouse. Currently, there are more than 160 online brokers, and the competition is fierce. Thus, the costs of making a stock purchase can be low. Connecting with online brokers is fairly easy. Once you get to their Web sites, most offer a demo.