Lightspeed Trading Review - Reliable Day Trading Platform for Active Traders

Lightspeed Trading Review

If you are looking for a broker that can allow you to trade in the speed of light, you might consider Lightspeed. As you will discover from this Lightspeed review, many highly active investors choose Lightspeed for the fast execution times and competitive fees.

Lightspeed is intended only for the most active of traders and novice investors should consider another brokerage. While they have low trade fees, Lightspeed does have a high minimum balance requirement and requires $100 in monthly trade commissions to avoid fees.

Frequent traders looking for low costs, speed, and even the occasional live webinar can benefit from Lightspeed. Plus, they even offer a 14-day free demo.


Brief Overview

Lightspeed is based in New York City and has been around since 1994.

Over the years, Lightspeed has been voted the #1 platform for active trading by Barron’s. Some of the reasons why include ultra-low latency that results in quick trade executions and trade commissions that start at $0.0045 per share ($1 minimum per trade) and can be as low as $0.0010 per share for the most frequent traders.

You can trade individual stocks, ETFs, options, and futures with Lightspeed.

They also offer over 100 routing options, downloadable Direct Access Market platforms for any PC, Mac, or mobile device, and a research platform powered by TipRanks with their Lightspeed Trader platform.

Lightspeed even offers front-end API for automated investing.


Who Should Consider It

The only investors that should consider Lightspeed are very frequent traders as you need a minimum account balance of $25,000 of most platforms and you need to make at least $100 in monthly commission fees or pay a software fee.

Lightspeed is used by active traders from all backgrounds ranging from individual investors to hedge fund managers for its speed and competitive trade fees.


Likes & Dislikes

Likes

Dislikes

  • Fast trade executions
  • Low per-share commissions or flat-fee pricing
  • Over 100 routing options
  • Free 14-day trial
  • Platform can be initially overwhelming for experienced investors
  • Limited charting features
  • Cannot trade mutual funds or bonds
  • Need a minimum account balance of $25,000 to use Lightspeed Trader Platform
  • Monthly maintenance and data fees

Investment Offerings

With Lightspeed, you can trade stocks, ETFs, options, and futures. All these investment offerings come with extensive routing options.

You cannot trade mutual funds or bonds. Futures are only available on their most expensive platform called RealTick Pro with a monthly software fee of $325.

As Lightspeed is intended for day traders, they will have all the investment offering they need. As you cannot efficiently day trade bonds or mutual funds, the lack of these offerings is a minimal drawback. All offerings can also be traded intra-day.


Fees

Lightspeed offers two different commission structures. The flat-rate pricing model starts at $4.50 per trade for stocks and ETFs.

If you make more than 10,000 trades a month, the commission drops to $2.50 per trade.

If you are an active trader, Lightspeed has a tiered per-share commission fee chart based on the number of shares you trade each month. There is a $1 minimum commission with each trade.

  • Under 249,999 shares per month: $0.0045 per share
  • Over 250,000 shares per month: $0.0035 per share
  • Over 1,000,000 shares per month: $0.0025 per share
  • Over 3,000,000 shares per month: $0.0020 per share
  • Over 6,000,000 shares per month: $0.0015 per share
  • Over 15,000,000 shares per month: $0.0010 per share

There is a monthly software fee of $100. The fee is waived if you make more than $100 in trade commissions. Otherwise, the fee is prorated if you trade less frequently.

Lightspeed also charges monthly data fees starting at $10 per month for non-professional investors ($120 for professionals) for real-time Level 2 streaming data.

Options quotes cost an additional $10 per month.

The tiered fee structure is very advantageous to the most frequent investors and the per-share pricing is very competitive. This can result in huge cost savings compared to other active investor platforms.

The additional fees like the market data and maintenance fees are nuisances but are still very reasonable.


Platform

Lightspeed offers five different trading platforms, including a web platform and mobile platform that was recently launched in 2017.

The most popular option is the Lightspeed Trader desktop platform. Before committing you can get a free 14-day demo account.

Usability

The Lightspeed Trader desktop platform is feature-rich and looks very similar to many other active trader platforms. There is a small learning curve due to the complexity of the system.

The entire platform is real-time and can get slow on heavy trading days. You have full command of executing trades, charting, and streaming quotes.

Hot keys and hot buttons make it easy to trade in a second.

Overall, the platform is stable, highly functional, and gives you complete control of the trading process.

Design

Some say Lightspeed is the “least beautiful” of the active trader platforms, but it gets the job done.. The platform has a black background with white text. Gainers and losers are also coded in green and red.

The platform is designed to have separate windows for executions, charting, quotes, and order windows that way all your information can be in one place.

Lightspeed Trader might not have the most current layout, but, it is still very functional and efficient.

Customization Options

The Lightspeed Trader platform is fully customizable.

In fact, it is designed to fit across four monitors.

And, there are several different layouts to choose from with the click of a button.

Being able to adjust the layout for your personal preferences offsets the lack of design features that other brokerages offer. This personalization means you can still trade quickly and efficiently.

Advanced traders with programming knowledge can also use front-end API to enhance their platform.


Mobile

Lightspeed’s mobile app just launched in 2017 and still has room to grow. It is more intended for basic investment needs. You can only stream Level I data and execute basic order or do basic charting.

Lightspeed users now have an option to trade on the go when they cannot be at their normal workstation for short time periods.

The app is a positive step for addressing investing needs in the 21st century, but, still a work in progress.


Unique Features

One unique feature that Lightspeed offers is front-end API that can improve the capabilities of the desktop platform for investors with a programming background. It can handle up to 1500 orders a second which is also really powerful.

The Lightspeed Trader Scanner can also be used to quickly identify actively traded stocks and potentially mispriced securities.

This feature isn’t exclusive to Lightspeed, but, it can make day trading more profitable.

Lightspeed might not be the trendsetter for advanced trading, but, it is still very powerful and effective. By being able to add front-end API, investors can improve their trading experience by trading with algorithms.


Trading

Process

Lightspeed makes the trading process quick and easy. You can create multi-routing trades on a single screen and designate hot keys to automatically populate certain fields.

Overall, the order process is just as easy with Lightspeed Trader as other active trading platforms.

Order Filling

Orders are filled instantly because of the ultra-low latency. All trades are completed in real-time in the order received.

You will have a hard time finding a brokerage with faster execution times!

Charting

Charting is one of Lightspeed’s weaknesses. Frequent traders probably won’t stop to take the time to do much, but, other active platforms do have more extensive options.

While the number of studies is relatively limited, charts do pull from Level II data and hot buttons allow you to view multiple charts.

Some of the different studies you can view include moving averages, comparison charts, relative strength indicators, and Bollinger bands.

Advanced charting, although nice, isn’t a necessity for most cost-conscious traders using this platform.

Research

Similar to charting, research is limited to the basic and historic quote details provided by TipRanks.

Limited research is most lacking when you want to research options before trading. As most traders are focused more on factors like price and volume instead of the expert opinions, the lack of research won’t deter most active traders.


Educational Materials

One surprising feature for a high-frequency brokerage is its depth of educational materials.

Lightspeed is constantly having webinars on various topics ranging from market conditions to using their platforms. For example, you can watch a webinar on how to use hotkeys or to save money on your taxes.

They also have educational articles and videos on topics like options trading, platform tutorials, and trading strategies. All this material is intended for experienced investors who might need a little help from time to time.

Lightspeed’s videos and webinars can also be helpful to improve your trading strategies, learn how to navigate the platform, or hear about market updates.


Support

In general, Lightspeed has positive customer service reviews.

They only provide phone and e-mail support. If you need to contact Lightspeed, it is recommended to contact them by phone as response times are often in one minute or less and the agents are helpful and professional.

Email response times can range from a response within one hour or several days. There is room for improvement in terms of e-mail support.

Lightspeed doesn’t have award-winning customer support, but it is still good. If you cannot find online resources, your next best option is calling their toll-free number before sending an e-mail.


Lightspeed Trading Review Verdict

Lightspeed does a good job of providing the tools necessary to court the most frequent of investors with quick executions, rock-bottom trade fees, and the ability to add customized API for algorithmic trading.

Casual investors and active investors that want extensive research or charting features will want to find a different brokerage.

If your primary focus is frequent trading at the lowest cost, Lightspeed is worthy of your consideration.

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.

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