Etrade Review

Etrade Review

Known for its talking baby commercials, Etrade is a stand out broker, not only because of its clever marketing department, but also because of its well-rounded, well-executed offerings. I have yet to have one of those frustrating client experiences that can plague smaller brokers, and overall, I am fan of this broker.

The Etrade site is a breeze to use and has the key components for a quality experience during each visit: clean navigation, real-time streaming quotes, a sitewide quick access footer bar, simple account management, and a user-friendly order entry screen. Products like Etrade 360, the broker's fully customizable drag-and-drop homepage, are executed well.

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.

Customer Service

Etrade's customer service competes with the strongest brokers in this category, including TD Ameritrade, TradeKing, Scottrade, and Charles Schwab. Etrade's email support was rated #1 in this year's StockBrokers.com Broker Review. On the con side, we found Etrade's 24/7 weekend support to be very weak.

If there is a minor gripe to be made with Etrade's customer service, it's that the broker tries to funnel clients to the self-help FAQs area before providing the contact information. While I can't blame them for trying to minimize support volume, it does take two clicks to reach the contact form and service numbers (which is provided 24/7). In comparison, some other brokers put their contact numbers front and center site-wide.

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 hyper-active 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 $19.99 per trade. Charles Schwab, Fidelity, and TD Ameritrade charge $49.95, $75, and $49.99, respectively. As far as total selection, the broker offers more than 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 last few years. While the broker does not quite match TD Ameritrade's 100-plus commission-free ETFs offering, there are 92 in total.

	Etrade	TD Ameritrade	Fidelity	Charles Schwab	Scottrade
Stock Trades	$9.99	$9.99	$7.95	$8.95	$7.00
Options Base	$9.99	$9.99	$7.95	$8.95	$7.00
Per Contract	$0.75	$0.75	$0.75	$0.75	$1.25
Mutual Funds ($)	$19.99	$49.99	$75.00	$76.00	$17.00
Broker Trades	$25.00	$44.99	$32.95	$25.00	$32.00
Commission Free ETFs	92	101	31	105	0
Commissions, Fees
Overall

Research

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, alert setup, buy and sell buttons, headlines, price analysis from Trefis research, a company overview description, and a box highlighting some of the recent analyst research reports. And that is just the default page.

Etrade's third party research report providers include Thomson Reuters, Standard & Poor's, MarketEdge, and SmartConsensus. Another plus is that all mutual fund research is provided by Morningstar which is the best of the best as far as mutual fund research providers goes.

The charting functionality was something I particularly enjoyed, as I could popout 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 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 was 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 are two platforms available: Etrade MarketTrader (web-based) and Etrade Pro (desktop-based). Both platforms require at least 30 stock or options trades per quarter or a portfolio balance of $250,000 to be used for free. Etrade Pro can be accessed for $99 per month otherwise.

While MarketTrader is impressive, the spotlight really falls on Etrade Pro. This is the broker's flagship platform, and it 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 with over 60 different available studies, real time sales, and level 2 quotes, among others.

Comparing apples to apples, Etrade Pro is impressive, however it still lacks the depth of industry leading platforms TradeStation and thinkorswim by TD Ameritrade.

One other note: Clients making 30 or more trades per quarter also will automatically get Etrade Pro Elite status, giving them free access to Etrade Pro alongside priority routing to the Elite customer service team for customer service and trading. Considering the quality of the regular customer service, I found Elite status to be nothing more than a cool title.

Final Thoughts

I've found through my Etrade review that while Etrade's stock ETFC took a beating throughout 2007 and 2008 as the broker's mortgage portfolio became a nightmare, the trading part of its business stood strong. Today, Etrade's commercials remain relevant, the broker continues to innovate, and all in all, it provides a wonderfully well rounded offering for its clients.

Whether 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.