ETRADE Securities is the grandfather of online discount brokerage houses. ETRADE is for engaged and active investors. The Power ETRADE platforms bring clients a plethora of strategy development and options analysis tools. ETRADE’s excellent resources and usability are among the things to thank for their continued high ranking among the best online brokerages. ETRADE has something to offer for all categories and levels of investors.
THE BOTTOM LINE: ETRADE is very popular among online brokers because of the company’s $0 commissions and strong trading platforms. These features appeal to active traders, while the benefits that can be gotten from their library of educational resources appeal to beginner investors.
PROS & CONS
PROS
- Easy-to-use and advanced mobile apps. Their mobile apps, regular ETrade, and Power ETrade are well laid-out, easy to use, and very comprehensive and extensive. Power ETrade focuses on options and futures.
- Paper trading imitates the entire Power ETrade platform. These days it is hard to find paper trading capabilities in trading platforms but ETRADE Pro’s desktop platform is programmed to test strategies and capabilities.
- Their Prebuilt Portfolio makes it possible for investors to get invested quickly. The prebuilt portfolio offers three different risk levels that you can choose from (conservative, moderate, or aggressive) and investors don’t need to pay any other fee apart from fund management costs.
- They have large investment options that investors can select from.
- The company has excellent customer support.
- They have a library and offer their investors access to extensive research.
- They offer commission-free stock and ETF trades.
CONS
- ETrade Website can be difficult to navigate for beginner investors
- The product portfolio covers only US markets.
FULL REVIEW
With its library of professional-level trading platforms, educational resources, and tools to help build a balanced and risk-appropriate portfolio, ETRADE offers value to both frequent traders and beginner investors. The company’s $0 commission for all stock, ETF, and options trades is very attractive and active traders will appreciate it.
ETRADE IS BEST FOR:
- Frequent and active traders
- Free commissions for all stock, ETF, and options.
- Research and data
- Beginner investors.
- Retirement planning assistance.
ETRADE AT A GLANCE:
Minimum investment $0 (There is no limit to how much you can invest.)
Stock trading costs $0 (Free of charge)
Options tradesThere is no base commission. $0.65 per contract (volume discount available)
Account fees (annual, transfer, closing, inactivity)You won’t be charged any annual or inactivity fee. You will pay $75 for full transfer out fee and $25 for partial transfer out fee
Mutual Funds $19.99
Number of commission-free ETFsAll ETFs trades are commission-free.
The number of no-transaction-fee mutual fundsOver 4,500
Account typesTraditional IRA, Taxable Joint, Roth IRA, SEP IRA, Rollover IRA, Solo 401(k), SIMPLE IRA, Coverdell, Trusts, Custodial.
Tradable securities/Investment typesStocks, ETFs, Bonds, OTC/Penny Stocks, Mutual funds, Options, Futures
Trading platformE-Trade Web and Power E-Trade (They are both available for free for all customers)
Mobile app ETRADE mobile and Power ETRADE (Both are available on iOS and Android.)
AccessiPhone App, Web-Based, Android App, Apple Watch.
Research and data The library is extensive and free. More than eight providers are available at no cost.
Broker Assisted Trade $25
Customer support options 24/7 Phone, email and live chat support. There are also 30 local branches that you can reach out to for any trading questions.
Where ETRADE shines:
- TRADING PLATFORMS: ETRADE has two trading platforms, ETRADE Web and Power ETRADE. These platforms are free and available to all customers, with no balance minimums or trade activity. ETRADE Website offers free real-time quotes, analyst research stock screeners, free streaming market, live market commentary, and a lot more. From the dashboard, you can view market data, create watch lists, make trades and track your accounts. Power ETRADE is for active traders. The platform offers streamlined trade tickets, over 30 drawing tools, and more than 109 technical studies, trading ladders real-time data, and customizable options chain views.
ETRADE OPTIONS TRADING PLATFORM.
The ETRADE has a plethora of educational demos and materials that educate investors on what each platform offers.
- FREE COMMISSIONS: Before 2019 ETRADE used to have a $6.95 trade commission but the firm dropped it to $0 for the online stock, options, and ETF trades. There is still a $0.65 contract charge for options but active traders are given a discounted fee of $0.50.
- MOBILE APP: ETRADE has two free mobile apps, available for Android Phone and Tablet, Kindle Fire, Amazon Fire Phone, Windows Phone, Apple iPhone/iPad/Apple Watch. The mobile app lets you get real-time quotes and news, place trades, and manage your account easily. It offers advanced mobile features like multi-leg options trades, stock, and ETF screeners. With the app, you can trade anywhere at any time.
With the Power ETRADE app, traders can have access to a plethora of popular technical studies, streaming news and quotes, charts, and customizable options chain. The app has a futures ladder where futures traders can enter futures orders directly. The app can be used for four-legged option spreads and other trading complex strategies. There is an option to integrate ETRADE with Apple Watch software for investors that want market information at a moment’s notice. Investors will find that Mobile App also has all of the functionality of the website.
- INVESTMENT SELECTION: ETRADE offers a range of investment choices that will please beginner investors, active traders, and retirement investors alike. These investment choices include more than 4,500 no-transaction-fee mutual funds lineup which easily rivals those at other brokers, futures, and advanced options strategies. Investors will have to pay $19.99 per transaction for Mutual funds not included on the no-fee list.
- EDUCATIONAL RESOURCES: ETRADE is great for beginner investors mostly because of the educational resources it offers. Traders can view webinars on topics such as how to diversify a portfolio, technical analysis, and options trading, online. The website offers a Learning Center that includes trading-related content, help using the system, and investing-related articles.
There is also a Getting Started section which beginner investors can check out to get more information on investing concepts. The education center is not just accessible to customers. Anybody can access it whether or not they are customers. It offers investor education in topics cutting across investing, trading, and retirement. There is also an option of ilter’ for investors to find related content by content format, skill level, and topic.
ETRADE also offers a day-to-day webinar to help its traders and investors become competent in the mobile, web, and Power ETRADE platforms. The website offers three to four virtual learning and webinar-based all-day events that have a structured, sequential learning format. These virtual events will be complemented by a complete on-demand library of all the content investors need to know about. Tri-weekly, the website offers content on the latest market and economic events amid the COVID-19 crisis. This content is available to everyone.
There are also COVID-19 research centers available for clients. To help clients understand the new laws and make the best decisions about their retirement, ETRADE updated its IRA-focused education offerings.
For investors that are still confused after going through the educational resources available, ETRADE has financial consultants that are always ready to answer trading questions 24/7, whether on phone, email, or via live chat.
ETRADE Core Portfolios are available for investors that want experts to make investment decisions for them. For an annual advisory fee of 0.30% of the investment amount, ETRADE experts will manage your portfolio for you.
ETRADE ACCOUNT TYPES FOR INVESTMENTS
- As a full-service brokerage, ETRADE offers investments in options, exchange-traded funds (ETF), target-date funds, futures, fixed-income assets like stocks and bonds, and more than 8,000 mutual funds.
Investors have the options of having regulars taxable brokerage accounts, Profit Sharing Plan, traditional or a rollover IRA or Roth IRA, SEP IRA or SIMPLE IRA (for small businesses), or 401(k) and Roth 401(k) (for individuals).
CUSTODIAL ACCOUNT: Investors have the option of opening a custodial account or/and a Coverdell Education Savings Account (ESA) for minors.
INVESTMENT ACCOUNTS FOR BUSINESSES: Investors can open investment accounts for their businesses whether it be a partnership, a sole proprietorship, or a corporation. If investors are interested, they can also open an account for an investment club. ETRADE has its clearing agency, ETRADE Clearing LLC which they use to settle investment transactions.
- CAPITAL MANAGEMENT: ETRADE Capital Management is available for investors looking for active portfolio management. ETRADE Capital Management’s Managed Accounts are also available for traders that don’t want to deal with the responsibilities of day-to-day portfolio management. This offer is only available to investors that have a minimum of $25,000 and will entitle them to an actively regulated portfolio of ETFs and mutual funds, rebalancing and tax management of their portfolio.
- APPLE PAY FUNCTIONALITY
ETRADE debit cardholders now have the option of Apple Pay functionality. They can now link ETRADE debit cards directly to Apple pay and use the money in their account for day to day purchases. This payment option is simple and efficient and makes for a secure, enjoyable card-free payment.
- POWER ETRADE PRO
ETRADE Pro function has been upgraded to make advanced trading software more understandable and relevant to regular investors. This function is available to any customer who executes not less than 30 stock or options trades quarterly or maintains a minimum brokerage account balance of $250,000. There’s no additional charge to use this function. This function comes with a Point-and-click order entry where investors have to click the security icon or symbol from the board or panel they are located at and then the trade happens; Professional-grade advanced and innovative trading tools such as analyzers, strategy optimizer, margin analyzer, and advanced options screener; and Real-time technology which tracks the investment markets with live market news, industry tracker, and live streaming watch lists; Sector & Industry Tracker that offers a bird’s-eye view of investment market.
- ETRADE PRO USER ORIENTATION
ETRADE offers orientation videos. Investors can then launch a suggested layout when viewing these videos. The feature offers two screens or more for personalization. This tool allows investors to run through different scenarios based on price points and expiration dates, build multiple options strategies and easily send any strategy directly for trade execution, and effortlessly customize graphing features.
- ETRADE ACCOUNT PROTECTION
ETRADE uses SIPC to protect securities within investors’ accounts for up to $250,000 in cash and $500,000 generally. ETRADE also has “excess SIPC coverage” that covers up to $900,000 in cash and $600 million generally ($150 million per customer). This coverage is not for declines in the market value of investors’ portfolios but broker failure.
ETRADE offers FDIC insurance coverage of up to $250,000 per customer for investors with funds on deposit with ETRADE Bank. ETRADE’s Complete Protection Guarantee offers $0 liability for unauthorized use of your accounts.
ETRADE also offers a Symantec Virtual Digital Security Token where investors get sent a keychain-sized device that creates a new private 6-digit access code every 60 seconds. There is also an app for those that use smartphones that also does the same as the key fob. This feature is available for Android, iPhone, and Windows smartphones. An investor has to log in with their username, password, and key code, which makes unauthorized logins to their account impossible.
- COST
ETRADE does not charge any commission for online equity, or ETF trades. In OTCBB trades, clients that place fewer than 30 trades per quarter incur a commission of $6.95 per transaction while clients with 30+ trades per quarter incur a commission of $4.95 per transaction. Options trades do not have a per-leg commission. $0.65 is for most clients in per-contract. $0.50 is for clients that place more than 30 trades/quarter. Fees are waived for contracts priced at $0.10 or less.
ETRADE PRICE SUMMARY:
FEE AMOUNT
ETF TRADE FEE$0.00
OPTIONS BASE FEE$0.00
MINIMUM DEPOSIT$0.00
OPTIONS BASE FEE$0.00
STOCK TRADE FEE$0.65
FUTURES (PER CONTRACT)$1.50
MUTUAL FUND TRADE FEE$19.99 (no commission charged for 4,500 mutual funds)
BROKER ASSISTED TRADES FEE$25.00
Where ETRADE falls short
- WEBSITE TRANSPARENCY: ETRADE comes up a bit short in how easy and quick clients and potential clients can find key information on the website.
- PRODUCT PORTFOLIO COVERS ONLY US MARKETS: At ETRADE, investors can trade various asset classes from stocks to futures, but only on the US market.