E*Trade Review - Possibly the Best Online Broker Ever?

ETrade Review

E*TRADE is one of the most popular online brokerages. Known for their witty television commercials, E*TRADE has been able to establish a loyal audience of new investors and experienced investors. This E*TRADE review will help you decide if this is the best brokerage for your investment needs.

New investors will enjoy the detailed trading platform, competitive pricing, and the ability to open retirement and non-retirement accounts. Experienced investors will also enjoy E*TRADE’s array of advanced tools, but, frequent traders might be turned off by the relatively high fee structure.

E*TRADE has received much praise from leading financial publications for their wide selection of investment offerings and customer service. Is E*TRADE the best option for new and experienced investors?


Brief Overview

E*TRADE was created in 1983 and holds claim to executing the first-ever online trade for an individual investor.

Since then, E*TRADE has quickly become one of the most popular online discount brokerages. Today, they have a large online customer base and also have 30 physical branches located across the United States.

All trades at E*TRADE cost $6.95 or less for stocks, option, bonds, ETFs, mutual funds, and futures. E*TRADE supports self-directed brokerage and retirement accounts with a $500 initial account balance.

They also offer “robo-advisor” managed portfolios starting at $5,000, and, you can also work with a financial consultant with a minimum initial account balance of $25,000.

The trading fees can be too expensive for frequent traders, but, advanced investors will appreciate the E*TRADE Pro platform. Beginner investors will have all the resources they need to invest with the regular E*TRADE Web platform.

E*TRADE has received awards for its research, education, mobile app, and customer service. These are all benefits that new and experienced investors will appreciate.


Who Should Consider It

E*TRADE is ideal for beginners and active traders.

Despite being a “discount” online brokerage, E*TRADE is a very feature-rich platform that will satisfy the trading needs of many. They have a large selection of commission-free ETFs and mutual funds that investors seeking instant diversification with each investment will enjoy.

The extensive research and data tools are also a plus for all investors that want a brokerage providing more than just basic quote details and historical share prices.


Likes & Dislikes

Likes

Dislikes

  • Competitive fees that decrease for frequent traders
  • In-depth and easy-to-use platforms and mobile app
  • 110+ Commission-free ETFs
  • Wide array of investment choices
  • Excellent customer support
  • Discounted trade fees are still relatively high
  • Minimum initial account minimum of $500
  • Need $25,000 account minimum to use E*TRADE Pro active trader platform

Investment Offerings

E*TRADE has a wide variety of investment offerings for any investment account. This includes brokerage, retirement, and small business accounts.

  • You can buy U.S. listed stocks and also have access to international markets including Canada and Europe. It is also possible to trade penny stocks on E*TRADE.
  • E*TRADE also offers over 4,400 fee-free mutual funds. In total, you can trade more than 9,000 mutual funds with the brokerage. Their All-Star list that currently consists of 136 funds can help you quickly find top-performing, fee-free mutual funds for almost any investment strategy and asset allocation.
  • You can also trade over 100 exchange traded funds (ETFs) commission-free. These fee-free ETFs are available for domestic and international fund categories. Some of the leading fund families include Guggenheim Investments, WisdomTree, and Oppenheimer, and JP Morgan.

E*TRADE rounds out their investment offerings with the ability to trade options, bonds, and futures.

If you do want a managed account, an E*TRADE managed portfolio is a good option for “set it and forget it” investors. These adaptive portfolios were launched in June 2016 and invest in low-cost index tracking mutual funds and ETFs.

E*TRADE offers every investment option that casual and frequent investors will want to trade on a regular basis. The wide selection of commission-free ETFs and mutual funds is also a very nice touch for “buy and hold” investors that are trying to keep investment costs to a minimum.


Fees

E*TRADE has two different pricing plans based on the number of trades you make each quarter. Trade fees are lower if you make at least 30 trades per quarter.

Casual traders will pay the following prices for each investment trade:

  • Stocks, Options, and ETFs: $6.95
  • Options Contracts: $0.75
  • Futures Contracts: $1.50
  • Bonds: $1.00
  • Mutual Funds: $19.99

Investors that make more than 30 trades a quarter will see their trade fees drop on select trades:

  • Stocks, Options, and ETFs: $4.95
  • Options Contracts: $0.50
  • All other trade fees remain the same for transaction-fee mutual funds, bonds, and futures.

For a managed E*TRADE adaptive portfolio, the management fees start at 0.30% APY with a minimum balance of $5,000.

In the never-ending trade fee war, E*TRADE definitely isn’t the cheapest brokerage at the moment, but, they are still very competitive at $6.95 a trade.

Other discount online brokerages with similar features allow all trades to be $4.95 for stocks, options, and ETFs. That is the discount price reserved for frequent traders.

Casual investors will be happy with the E*TRADE fees as $6.95 won’t break the bank. And, long-term investors will like the wide selection of over 100 ETFs and 4,400 mutual funds that trade fee-free.

Frequent investors might decide to choose a different brokerage if they do not want to pay the high fees to use E*TRADE’s platforms. Other brokerages with similar advanced platforms that cater to high-frequency traders that are simply looking for the lowest prices.


Platform

Casual investors and those with account balances smaller than $250,000 will automatically be enrolled in the E*TRADE web platform. This platform is very easy to use and packed with a lot of tools of features. E*TRADE has also recently improved the web platform to make it more user-friendly in 2016.

E*TRADE Pro is the brokerage’s flagship platform built for active traders and is desktop based.

While E*TRADE does have relatively high trade fees, their active platform can be worth the additional cost. You will need $250,000 in your account or make 30 trades each quarter to begin using the Pro platform. There are no recurring fees to use E*TRADE Pro.

With the Pro platform, you can access Level II data, advanced tools for back-testing and real-time strategy. These advanced tools can provider deeper analysis for options, futures, and margin trading.

There are many different tools you can use on the Pro platform and it is fully customizable. You can open new windows to display the data and charts that you need to review at a moments notice. It is even possible to livestream CNBC.

Usability

All the E*TRADE platforms are very easy-to-use. You can livestream quotes on any screen and make watchlists for prospective investments. Even on the basic web platform, it is easy to execute trades and initiate advanced options strategies.

Despite its complexity, the Pro desktop platform is also very user-friendly.

As with any advanced trading platform, there is a small learning curve. For the most part, E*TRADE Pro offers many of the same features as other advanced platforms including one-click trading, real-time quotes, and customizable screeners that can be created or moved within seconds.

E*TRADE also provides several orientation videos to help new users quickly learn the platform.

One reason E*TRADE has received many awards and built a large customer base is for their easy-to-use platforms. Recent updates to the web platform will be very beneficial to investors that don’t have $250,000 (yet) or do not make 30 trades a quarter.

If you do qualify for the Pro platform, you will be highly pleased with the available features and how you can quickly navigate between each tool.

Design

E*TRADE has a well-designed platform. Recent updates have “modernized” the platform for 2017. As the E*TRADE Pro platform is fully customizable, although you can also choose a premade layout, the sky is truly the limit.

It is easy to find all the information you need as the colors green and red indicate winners and losers. The black background and white font are also easy on the eyes.

If you only qualify for the web-based platform, E*TRADE Web still has a somewhat outdated look, but all the information you need is easily displayed as the dashboard includes the value and performance of your portfolio.

The upgraded watch lists and order entry windows have greatly improved the user experience.

All information on the E*TRADE Web platform is displayed in front of a white background and uses the green and red font to easily identify gains and losses.

Some brokerages might still win the award for design, but, E*TRADE has gone to great lengths to make their platforms as efficient as possible. This eye for detail helps make E*TRADE very easy to use for any investor.

Customization Options

E*TRADE Pro is fully customizable.

When you first begin trading on the platform, you truly have a blank slate. You can create windows to stream Level I and Level II data on command. To rearrange your platform layout, you simply click and drag the boxes you want to move.

The Pro platform starts all users with two customizable screens. You can customize up to six different screens. Recently, the limit was only four customizable screens.

Being able to build your own fully-customized E*TRADE Pro dashboard is awesome. This level of customization adds value to E*TRADE and a definite strength.


Mobile

E*TRADE has a highly functional mobile app. It is available for Apple and Android devices including the Apple Watch. It was even named Best in Class by Stockbrokers.com.

The mobile dashboard will display your portfolio’s top performers, open orders, and news related to your portfolio and watch lists.

The app provides all the tools required to research, chart, and create trades. It includes many bells and whistles like CNBC TV, Level II quotes, and third-party research reports.

Plus, you can get enhanced quote details for stocks, mutual funds, and ETFs.

When it comes to making trades, you can also make conditional orders such as one-triggers-other (OTO), contingent, and stop-loss.

E*TRADE was one of the first brokerages to roll out a mobile app and they also happen to have one of the best apps.

From making advanced trades to performing advanced research, the app allows you to do almost anything possible on the Web and Pro platforms.


Unique Features

There are a few unique features to the E*TRADE Pro platform that will benefit advanced traders.

Options Greeks

E*TRADE’s Options Greeks feature allows you to use the various Greek match symbols like Delta, Gamma, Theta, Vega, and Rho to assess risk.

Using Greeks allows you to get an in-depth analysis of potential options chains as you can create a more detailed and accurate investment strategy.

This is also in addition to the Enhanced Options Analyzer tool that E*TRADE already provides for trading options.


Ichimoku Cloud

The Ichimoku Cloud is an investment charting tool developed in the 1960s and E*TRADE has done a great job of promoting it as they recently bolstered their charting tools.

With the Ichimoku Cloud, traders can get a first look summary of a potential investment by seeing the asset’s trend, momentum, support, and resistance all in one place.


Six Customized Screens

Being able to customize up to six screens on E*TRADE Pro is also very impressive. Most active might not need these many screens, but, it is nice to have this feature.

“Data hungry” traders might choose E*TRADE just because they can have so many different screens available.


Sector and Industry Tracker

The E*TRADE Pro platform also allows you to track the performance of a particular sector or industry. This can be a great way to see the “big picture” on your dashboard beyond the performance of an individual asset and its historical or real-time performance.

E*TRADE has always provided tools like the Market Scanner to make it easier to predict future market movements.

As times change, E*TRADE has introduced new features to keep up with the needs of advanced traders. Advanced charting with Options Greeks and Ichimoku are two ways E*TRADE has helped make E*TRADE compete for the advanced trader.


Trading

Process

The trade process is very easy on any of the E*TRADE platforms. With the web and mobile platforms, you simply enter all the information into the trade window.

With E*TRADE Pro, one-click trading is enabled by clicking on the ticker symbol in any window. Doing so, will bring up a trade window that asks for the number of shares and type of order you want to enter.

The trading process with E*TRADE is as easy with any of the other leading brokerages. One-click trading is a definite positive for advanced traders that rely on speed.

Order Filling

Order filling is completed quickly with E*TRADE.

You can do basic trades such as market orders, stop limits, and put orders. They also have advanced routing options with access to 77 international markets. Forex and futures traders will also be pleased with the available options too.

Overall, order filling with E*TRADE is quick and complex trades can also be filled quickly when all the criteria are met.

Charting

Charting was a definite weak spot for E*TRADE until very recently.

They still do not have the most advanced charting features, but, it is highly competitive and will satisfy most basic and advanced traders as you can use Options Greeks and the Ichimoku Cloud.

It is even possible to expand a single chart to the full-size of your monitor. All charts are easy-to-read and can be customized based on the tests you may want to run.

Research

E*TRADE also has a very impressive research platform. You have access to four different third-party reports which can be more than enough, although other discount brokerages offer at least six research reports for stocks.

One downside to the E*TRADE research resources is the lack of in-house research and market commentary.

E*TRADE does a good job of providing an abundance of information from their third-party partners, but, some investors seeking guidance from their own brokerage will feel lacking for more information.

The research resources are very competitive and in-line with other major brokerages. While it’s the best brokerage for research, new and advanced investors will have all the information they need.


Educational Materials

Educational Materials

Beginner investors stand to benefit the most from the E*TRADE knowledge center. Their educational materials provide articles and videos relevant to new investors about how investments work, investment strategies, and retirement planning.

Beginner and advanced investors can also benefit from the “Market Insights” section that provides a running list of breakout stocks and articles about recent market events.

None of this material will greatly benefit the frequent investors except the orientation videos to the E*TRADE platform. They will most likely need to look elsewhere for trading tips and tutorials that pertain to advanced trading.

E*TRADE has always placed emphasis on beginner investors and that position hasn’t changed. New investors can read E*TRADE’s articles to learn more about DIY investing and other basic market commentaries that can help them make more educated investment decisions.

Even beginner investors that might only be interested in the managed portfolios for non-retirement and retirement income can benefit from these articles.


Support

Customer service at E*TRADE also receives positive reviews. Other brokerages have increased their quality of service recently and that has put additional pressure on E*TRADE, but customers have always been pleased with their response times and level of professional service.

Phone support is 24/7. You can usually expect to wait no more than five minutes to speak with a representative. This is a little high as other brokerages will answer your phone call in as little as one minute in may instances.

If you want to call about stock plans, you can only call Monday through Friday from 12 a.m. to 11:59 p.m. Eastern.

Chat support is also available 24/7 and can yield quicker response times than calling E*TRADE by phone as the average connect time is less than 60 seconds.

E-mail support is also available for prospective and existing customers 24/7. Most correspondences receive a response within 24 hours and can be used to electronically send documents.

E*TRADE has a good support platform. The best way to contact E*TRADE is by live chat for their quick response times. Calling them by phone is also quick and professional, but, other brokerages are quicker.

As most customers probably won’t use phone support on a consistent basis, it can be easy to overlook the longer wait times.


E*Trade Review Verdict

E*TRADE is a great brokerage option for casual and advanced investors due to their powerful platforms, a wide selection of investment platforms, and competitive pricing.

Casual investors will have all the resources and access to fee-free ETFS and mutual funds. Frequent traders will enjoy the E*TRADE Pro platform, but, can find similar platforms with lower pricing and similar trade execution times.

Andrew
 

My name is Andrew and I run Slick Bucks to help folks learn to manage money cleverly, and how that clever management can make you wealthier.

Real Time Analytics