With over 750 online brokers throughout Europe the problem of how an online trader chooses one has never been more acute or frustrating. The factors to consider often only enter the equation after bitter experience. These are my conclusions.

Of course price is of primary concern. Online trading is popular partly because it offers discount commissions for investors who do not want to pay a full-fee broker for advice they could have discovered themselves on the internet, or for trades where they do not want advice.

But even among online brokers the commissions can vary greatly and comparison is near impossible with each calculating commissions on different basis - some using the value of your trade, others the number of shares bought, and others the frequency with which you trade. www.uk.gomez.com will assist in price comparison. Also visit www.investorschronicle.co.uk.

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More than money
But there is more to online broker selection than price, if there wasn't then Schwab in the US, which is one of the most expensive online brokers, would not have the largest market share. The most important factor in selecting an online broker was customer service according to a recent study by JD Power and Associates. The same study, based only on US brokers and traders, found Schwab topped the list for offering greatest customer satisfaction.

Reliability in service is an essential pre-requisite for any online trader. There is no point saving £20 in commission on buying a stock, only to find you can't sell it because your online broker has broken down. Such 'downtime' by online brokers is becoming increasingly frequent in the US, and only last month even the mighty Schwab had one full hour where trades could not be placed. In a survey by the TheStreet.Com, again a survey of US brokers by US clients, DLJ Direct came top in the category of reliability.

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While these surveys are conducted on US brokers, I still look at them with interest, on the basis that the UK apple will not drop too far from the US tree.

Online trading is about more than placing a trade through an online broker instead of phoning a traditional broker. Trading online profitably still requires research to arrive at stock picks, and the internet is an excellent resource to offer this. I always check to see what research the online brokers offer. Do they provide free portfolio monitoring, charting, news from major wires, research from renowned institutions, commentary, or are they just a web-site appended to a traditional brokerage?

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Alpesh B Patel is the author of Net Trading: Get online with the new trading strategies; Trading Online: A step by step guide to cyberprofits. The Mind of a Trader: Lessons in trading strategies from the world's leading traders.