The biggest trade-off for using many discount brokers is that you lose access to the expertise and advice available with full-service brokers. Most discount broker accounts are tailored to self-directed investors, making them best for traders who have extensive investment knowledge and experience, or for those who are pursuing a low-risk strategy such as investing in low-cost, low-risk index funds.
When discount brokerages first appeared, there was a clear distinction between the minimal level of research and market education they provided, and the feature-rich experience of traditional, full-service brokers. Today, many discount brokerages offer their investors research materials and tools comparable with any other broker, making price-per-trade and tailored investing advice the main differentiators between discount and full-service brokers.