Published by Blain Reinkensmeyer
On Monday, September 28th, 2015
While ETRADE may not have the cheapest trades, the broker provides an easy-to-use website, a high quality mobile experience, and excellent research that will satisfy both casual and active investors.
Mobile apps remain industry leading; Google Chrome browser plugin is an innovative and clean trading experience; Online Portfolio Advisor is a foundation for seamless asset allocation; ETRADE 360 customizable dashboard.
ETRADE Pro platform requires 30 trades per quarter or $250,000 in assets for access; $9.99 trades pricier than most; ETRADE Pro lacks depth in charting and options capabilities.
Once known for its talking baby commercials, ETRADE has been working hard to evolve as a brand and speak to its current and target customers. The customers ETRADE targets are known as Type E*: investors who are confident, independent, yet willing to ask for help when they need it.
With this customer image in mind, ETRADE executes extremely well overall. ETRADE may not be the least expensive on the block, but the company continues to innovate with new tools and experiences for clients.
Commissions & Fees
While competitive with its other full-service broker competitors, such as TD Ameritrade, Fidelity, and Charles Schwab, ETRADE is not an ideal choice for investors seeking discounted commissions. In the broker space, though, most often what you pay for is what you get, and ETRADE's well-rounded offering offsets its higher rates.
Regular stock trades are $9.99, with options trades costing $9.99, plus $.75 per contract. All trades are flat rate commissions, meaning there are no gimmicks to watch out for, and hyperactive traders can get their rate as low as $6.99 if they make 1,500-plus trades per quarter.
ETRADE does stand out from its competitors with its mutual fund commissions, which run at $19.99 per trade. Charles Schwab, Fidelity, and TD Ameritrade charge $76.00, $49.95, and $49.99, respectively. As far as total selection is concerned, the broker offers just under 8,000 to choose from.
Lastly, I found that ETRADE has a reputable offering of commission-free ETFs, an offering that has become increasingly popular industry wide in the past few years. While the broker does not quite match Charles Schwab's 150-plus commission-free ETFs offering, there are still 106, which is second highest in the industry.
Ease of Use
The ETRADE website is a breeze to use thanks to a brand-new navigation experience launched in late 2014, quick access to real-time quotes site wide, and innovative tools such as ETRADE 360, the broker's fully customizable drag-and-drop homepage. The new navigation is clearly driven by understanding what clients use most. Hover over Accounts and the sub-menu options are “My Accounts,” “Move Money,” “My Profile,” “Tax & Account Records,” and “Banking.”
The experience doesn’t stop at just the ETRADE website, either. In October 2014, the broker launched a brand-new app for the Google Chrome browser, allowing for quick real-time quotes, portfolio monitoring, and trading on the go. Our testing found the app to be a seamless extension of the website experience and a very smooth experience overall. Time will tell whether or not it will be the new “go to” route for clients to place trades; habits are hard to break.
Like any experience, there is always room for improvement though. We’d love to see ETRADE add a trade ticket into its site-wide footer quote bar, along with real-time streaming quotes so clients don’t have to rely so heavily on MarketCaster, the broker’s somewhat outdated real-time streaming quotes applet. Having to load an applet in a new window, then click to “Trade Now” and be sent back to the website to place a trade is hardly intuitive.
In this year’s 2015 Broker Review, we found ETRADE's customer service to be on a par with the industry average. It’s very good, but it’s not award winning. Contrarily, in our 2014 Broker Review, ETRADE's email support was rated #1. This year, it finished #8.
Not all is gloomy though for ETRADE, as we were very pleased to see the broker heeded our call in our 2014 Broker Review to make its customer support contact information more prominent on its website. ETRADE delivered, with its customer support phone number now appearing on every webpage. Furthermore, after clicking “customer service” in the top header bar, clients are now immediately greeted with a quick link to live chat alongside additional phone numbers for phone support.
Performing research on ETRADE is simple and user-friendly. After pulling up a quote for Apple, clients see a quick overview of key statistics alongside a mini chart of the current day's action, alerts setup, buy and sell buttons, headlines, price analysis from Trefis Research, a company overview description, and a box highlighting some recent analysts’ research reports.
ETRADE's third-party research report providers include Thomson Reuters, Standard & Poor's, MarketEdge, and SmartConsensus. Access to the four providers is strong and something not found with discount brokers; however, compared to its closest competitors, ETRADE falls short as Charles Schwab, Fidelity, and TD Ameritrade all provide access to at least six.
I particularly enjoyed the charting functionality, as I could pop out the chart box into its own window and then enlarge it to take full advantage of my 24-inch monitor. Adjusting settings and adding studies alongside company event data such as splits, dividends, earnings, and insider trades was helpful. The standout feature here was the ability to display post-hours trading activity, which is great to use during the earnings season.
Platforms & Tools
For clients looking to simply track their favorite stocks and holdings, the ETRADE MarketCaster is the broker's real-time streaming quotes tool, which pops up as a new window when launched. MarketCaster is simple, easy-to-use, easily customizable, and I found it to be a great tool to leave open throughout the day to keep an eye on positions or a custom watch list.
For feature-hungry clients, there is ETRADE Pro (desktop-based). Access to ETRADE Pro requires Pro Elite status, which means making at least 30 stock or options trades per quarter or having a portfolio balance of $250,000. ETRADE Pro can be accessed for $99 per month, otherwise. In comparison, TD Ameritrade and Charles Schwab both give full access to their flagship platforms with no strings attached, while Fidelity and Scottrade also have requirements.
ETRADE Pro has all the bells and whistles an active trader could want, with snap grid functionality for quick and easy customizing. Pro supports some 20-plus tools, including streaming live CNBC TV, a real-time strategy scanner, several options tools, advanced charting, real-time sales, and level II quotes, among others.
While ETRADE Pro is impressive, the platform has slowly fallen behind its competitors in recent years. Compared with industry leaders, ETRADE Pro lacks depth in several key areas: options capabilities, alerting functionality, and technical studies support.
One other note about Pro Elite status: Alongside free access to ETRADE Pro, Pro Elite also gains access to the Elite customer service team for service and trading. Considering the quality of regular customer service is already strong, I found Elite status to be of little use, less so on the rare trading day when the market is in disarray and call volumes are excessive.
As the first broker to really push mobile, ETRADE continues its dominance, finishing first overall again in our rankings. ETRADE was the only brokerage to allow clients to compare their portfolio performance against the overall market averages (a nice touch) and had a slew of other features few other brokers offer: CNBC TV, level II quotes, barcode scanning, and third-party ratings, among others.
The only area in which ETRADE really falls behind is charting, where only two indicators are supported. While only having a handful of technical indicators/studies available to add to a chart is fairly standard, I expected more from ETRADE, considering its leadership in the industry. Another drawback is that the broker only supports basics stock alerts by price and does not allow clients to customize using studies.
Minor gripes aside, with 43 variables being assessed for mobile trading, ETRADE earned 92% of total possible points. The broker is No. 1 in my book because its apps are easy to use, dependable, and feature rich.
Alongside trading, ETRADE also offers basic banking services, including checking accounts with no ATM fees and debit cards. The broker also provides 30 local branch offices.
ETRADE as a brand has had its fair share of ups and downs over the years. The broker rose to be a leader in the industry in the early 2000s, then the stock price took a beating throughout 2007 and 2008 as the broker's mortgage portfolio became toxic. Despite these struggles during the worst financial crisis in US history since the great depression, ETRADE’s trading experience has stood strong.
The broker pressed forth and became the undisputed leader in mobile trading, which was then unchartered territory. Most recently, the move away from the iconic baby commercials has ETRADE focusing on its core clients, Type E*. The broker remains #1 in its mobile offering, continues to innovate with new offerings such as its Online Portfolio Advisor service, and, all in all, provides a wonderfully well- rounded offering for its clients.
Whether you’re an active trader, a new investor, or just someone looking to manage a retirement portfolio, ETRADE is a dependable, full-service broker that impresses all investor types and gives its competitors a run for their money.
The content portion of this Review was completed on February 17th, 2015.
Blain has been involved in the markets for over 13 years, heading StockBrokers.com equity broker research and reviews. His personal blog, StockTrader.com, provides to-the-point daily market recaps to over 17,000 subscribers.
E*TRADE has a fairly straight forward commissions structure. Full ETRADE review commissions breakdown is below. Note that ETRADE's advanced trader platform, Power ETRADE Pro, is free if atleast 30 trades are made each quarter or if there is $250,000 in total assets. Otherwise the platform can be used for $99 per month.
Stock Trades - All trades are a flat-rate $9.99 if making up to 149 trades per quarter, $7.99 (150 - 1499 trades per quarter), and $6.99 (1500+ trades per quarter). For broker-assisted trades, add $45 to the total order. When trading during pre and post market hours, an ECN fee of $.005 per share is added to the regular commission rate.
ETRADE does not charge any additional fees for placing penny stock trades or buying OTCBB / Pink Sheet stocks. For any stock under $1 per share, only limit orders (no market orders) may be used to place trades.
In Q2 2010 ETRADE did away with its ill received account service fee of $40 per quarter which, while rare, could be assessed if certain conditions were met.
Options Trades - When trading options, an options regulatory fee of $0.014 per contract with a $0.04 minimum will apply.
Mutual Funds - All mutual funds cost $19.99 per trade. Additional fees may apply depending on the fund.
International Trading - ETRADE also offers international trading in Canada, France, Germany, Hong Kong, Japan, and the United Kingdom. Commissions fees vary according to location. Alongside global trading, futures trading, bonds, and mutual funds trading is also available.
All pricing data was obtained from a published web site as of 5/01/2015 and is believed to be accurate, but is not guaranteed. The StockBrokers.com staff is constantly working with its online broker representatives to obtain the latest pricing data. If you believe any data listed above is inaccurate, please contact us using the link at the top of this page. For stock trade rates, advertised pricing is for a standard order size of 500 shares of stock priced at $30 per share. For options orders, an options regulatory fee per contract may apply.