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Broker Reviews

Scottrade

Published by
On Thursday, April 16th, 2015 .

Overview

Scottrade offers self-direct investors the tools they need to succeed, and for investors seeking guidance, Scottrade’s massive branch office network, which offers reliable and personable relationships, is an easy win.

Dislikes

ScottradeELITE requires $25,000 minimum; weak in-house options capabilities; offers instead the OptionsFirst platform powered by OptionsHouse for advanced options trading.

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Scottrade Review

To cut to the chase: Scottrade lives up to its commercials. The company defines what a broker-client relationship should be, with everything from opening an account to placing a trade or receiving professional guidance being a straightforward and enjoyable experience.

When I opened a new account to conduct my Scottrade review, I knew Scottrade had tough competition and was curious to see how well the broker would perform. The application was a breeze as I filled in information and took advantage of the live chat assistance. Within several hours of completing my application, a Scottrade rep from my local branch office called me, welcoming me to the broker, letting me know where they were located, and asking if I had any questions.

Immediately, I felt I was in good hands and couldn't help but think Scottrade was going to be my new best friend.

Commissions & Fees

Compared to other full-service brokerages, Scottrade is mostly less expensive. Regular stock trades cost $7 compared to the closest pricing competitor, Fidelity, which charges $7.95 per trade. Charles Schwab is next closest with its $8.95 trades. All trades operate under a flat-fee structure, meaning there are no gimmicks or trickery. Pricing is straightforward and simple unless you are trading stocks less than $1 per share, for which the cost is $7, plus .5% of the trade value.

Options trades will set you back $7, plus $1.25, which is more costly than Scottrade’s competitors if you are trading more than a handful of contracts at a time. TD Ameritrade, ETRADE, Fidelity, and Schwab all have higher base commission charges but only charge $.75 per contract instead of Scottrade's $1.25.

Lastly, Scottrade offers a massive selection of mutual funds, more than 14,000 funds in total, so you will not have any trouble finding something that suits your portfolio mix. Mutual fund trades cost only $17 each, the lowest among Scottrade’s competitors. For those who prefer ETFs over mutual funds, Scottrade may disappoint as it does not have a selection of commission-free ETFs. If commission-free ETFs are your thing, then consider Charles Schwab, ETRADE, or TD Ameritrade, as each broker offers more than 100 of them.

ScottradeTD AmeritradeETRADEFidelity Charles Schwab
Stock Trade Fee (flat)$7.00$9.99$9.99$7.95$8.95
Options Base Fee$7.00$9.99$9.99$7.95$8.95
Options Per Contract Fee$1.25$0.75$0.75$0.75$0.75
Mutual Fund Trade Fee$17.00$49.99$19.99$49.95$76.00
Broker Assisted Trades Fee$32.00$44.99$25.00$32.95$25.00
Commissions & Fees

Customer Service

Scottrade, which has won our title for Best Overall Client Experience from 2012-2015, offers the most personalized customer service out of any of the full-service brokers I've tested. And considering the competition, this is no small feat. I found Scottrade to be the only online broker that completely leans on its local branch office network. Calling the support phone number on the Scottrade website during market hours elicits a prompt for your zip code, then redirects you automatically to your local branch office.

Within a few rings, I was speaking with a rep from my local branch office. Not only did he know the Scottrade website like the back of his hands, but he had no trouble answering my questions regarding my new account and website. Scottrade's network has 503 local branch offices within the United States, and all operate during standard market hours: 8:30 a.m. to 5 p.m. Monday through Friday.

The only downside of Scottrade's phone support is that it is not 24/7, unlike TD Ameritrade, ETRADE, Fidelity, and Charles Schwab, all of which offer phone support any day, any time. Furthermore, the quality of support can vary greatly depending on the staff of your local branch office. When I originally opened my Scottrade account several years ago, I had no issues with support (see above commentary). However, since expanding our phone testing to incorporate branches from across the country, we have found the quality good overall, but inconsistent.

Phone testing aside, Scottrade shines for its email support. All our tests received responses within eight hours, and the end quality was outstanding. In fact, Scottrade receives nearly perfect scores on every test, a near flawless performance we have not witnessed in five years of conducting annual reviews. Once we compiled the data, it was not a surprise to find Scottrade at the top, finishing No. 1 for email support.

Research

Scottrade's research offering is thorough, covering the major bases well, including fundamental data on insiders, earnings, financials, and even SEC filings from several third-party research providers. Compared to its competitors, third-party research is one area in which Scottrade falls behind, but not by much. Pulling up a quote on Apple (AAPL) offered me reports from three third-party providers: Standard & Poor's, Thomson Reuters, and Second Opinion. While this will more than satisfy the majority of investors, picky clients may still be left craving more (Fidelity, Charles Schwab, and TD Ameritrade all offer at least six).

Navigation through the research area, like the rest of the Scottrade website, was clean and straightforward. Not only does Scottrade have a quick quote box on the top header, but it also has one on the left sidebar and footer bar. You can even place trades from any page, or website for that matter, by popping out the trade ticket bar in the footer – another nice touch. Focusing back on the research section, whether I was pulling up a quote or looking at a stock chart then reading an analyst report, I had no problem finding my way around.

One feature I really enjoyed, which is exclusive to Scottrade clients, was the Scottrade SmartText functionality. SmartText analysis is available for charts, sectors and industries, and earnings. With charts, for example, Scottrade SmartText will quickly analyze any indicator you add and give you an easy-to-understand explanation of what that indicator implies for the stock you are researching. For example, SmartText gave me this breakdown for Google's 13-day moving average, "On Tuesday, GOOG closed below its 13-day moving average. This is generally considered to be an indication of a bearish trend."

Scottrade SmartText

Scottrade's research is also thorough for mutual funds. With research provided by Morningstar, my personal provider choice for mutual funds research, Scottrade does not disappoint. Immediately after pulling up a quote for Pimco's Total Return Fund PTTDX, a chart appeared displaying the fund's performance in the past decade compared to intermediate-term bonds and the S&P 500. I then read a synopsis of the fund's strategy, took a look at the Morningstar category ratings, and analyzed the fund's expenses to help me decide whether to buy or not.

Platforms & Tools

Scottrade offers several different platforms: Scottrader Streaming Quotes, Scottrade ELITE, and Scottrade Options First (white-labeled version ofOptionsHouse2.0 platform). Scottrade ELITE requires clients to have at least $25,000 in their account before gaining access.

Scottrader Streaming Quotes is a Java-based application that neither runs in a browser nor operates as a full desktop download. Instead, it loads as a Java app through the web. With easy buttons to open new windows and three customizable layouts, I found the application functionality to be easy to set up and use. Each watch list is drag-and-drop friendly and can have up to 40 securities.

scottrade streaming quotes

The one major gripe with the Scottrader Streaming Quotes application is that there is no snap window functionality, so aligning any open windows (the trade ticket, charts, top gainers, time and sales box, etc.) to fit into a grid is a bit tedious. My only other criticism would be that the quote screen window does not display the market index returns in large numbers at the top. Instead, they are small items at the bottom and do not include a percentage return for the day. Pickiness aside, Scottrade Streaming Quotes gets the job done.

Scottrade's advanced platform, Scottrade ELITE, is a desktop- based platform designed for active traders seeking detailed functionality beyond what Scottrader Streaming Quotes has to offer. Over the years, Scottrade ELITE became old and outdated, falling behind the rest of the industry in most areas. That all changed in 2014 though, when Scottrade launched a brand-new version of Scottrade ELITE. Completely recoded from the ground up, not only is the new Scottrade ELITE significantly more pleasant on the eyes, but it is easier to use, faster, and has a great foundation for expansion moving forward.

Scottrade ELITE chart

Other Notes

In the summer of 2013, Scottrade released its second-generation iPhone and Android app alongside its first-generation iPad app. With a much cleaner interface and cloud syncing watch lists, the apps are easy to use and, overall, very well built. These new apps propelled Scottrade’s Mobile Trading category score from 3 stars in our 2013 Review to 4 stars in our 2014 and most recent 2015 Review.

Also in 2013, Scottrade introduced an industry-first FRIP (Flexible Reinvestment Program). A FRIP is similar to a DRIP (Dividend Reinvestment Program), except that investors can customize how the dividend is used. Reinvestable dividends can be used to purchase shares in up to five different eligible securities (exceptions include OTCBB stocks). The FRIP is an industry first, and the clients I spoke with love it. Even today in 2015, the FRIP remains an exclusive Scottrade tool.

Finally, in 2014, Scottrade released two new tools. First, the Portfolio Review tool offers a complete breakdown of client portfolios as well as functionality to reassess portfolio allocations. Secondly, Scottrade revealed The Launching Pad, a new community area where current clients can see the latest products under development, share feedback, and help drive innovation. The first product to come out of The Launching Pad was integrating StockTwits as an optional column in watch lists.

Scottrade portfolio review

Final Thoughts

Scottrade, with its network of more than 500 branch offices and fantastic email customer support, offers clients a large selection of investments and quality research to make educated investment decisions. While the broker trails its closest competitors in several categories, such as Platforms & Tools and Mobile Trading, the rates are less expensive overall and the broker is pushing forward with innovative products to keep clients wanting more.


Blain Reinkensmeyer

Reviewed by

Blain has been involved in the markets for over 12 years, heading StockBrokers.com equity broker research and reviews. His personal blog, StockTradingToGo.com, provides to-the-point daily market recaps to over 17,000 subscribers.

Commission Notes

Scottrade is an online broker with a straightforward pricing structure. To access Scottrade's active trader platform, ScottradeELITE, clients must have $25,000 in total assets or make 9 trades over a three month rolling period.

Stock Trades - All stock trades are $7 per trade with no limits on the number of shares traded. For stocks priced under $1, an additional .5% fee of the principal value will be added to the $7 base commission rate.

Options Trades - $7 + $1.25 per contract.

Mutual Funds - Mutual funds cost $17.00 per trade. Additional fees may apply depending on the fund.

International Trading - Scottrade also offers trading services for China through the Chinese version of its website.

Trade Commissions Breakdown

$7.00 Stock Trade Fee (flat)*
N/A Stock Trade Fee (per share)*
$7.00 Options Base Fee*
$1.25 Options Per Contract Fee*
$17.00 Options Exercise Fee
$17.00 Options Assignment Fee
$17.00 Mutual Fund Trade Fee
$32.00 Broker Assisted Trades Fee
$2,500.00 Minimum Deposit

Margin Rates

7.75% Under $24,999.99
7.25% $25,000.00 to 49,999.99
6.75% $50,000.00 to $99,999.99
6.50% $100,000.00 to $249,999.99
6.25% $250,000.00 to $499,999.99
5.75% $500,000.00 to $999,999.99
5.25% Above $1,000,000.00

Miscellaneous Fees

$0.00 Bond Trade Fee
$0.00 Treasury Trade Fee
$0.00 CD Trade Fee
$32.00 IVR Trade Fee
$0.00 IRA Annual Fee
$0.00 IRA Closure FEe
$25.00 Forced Margin Sellout Fee
$75.00 Returned ACH Fee
$25.00 Returned Wire Fee
$0.00 Stock Certificate Processing Fee
$0.00 Stock Certificate Delivery Fee
$2.00 Paper Statement Fee
$1.00 Paper Confirmation Fee
$25.00 Domestic Wire Fee
$40.00 International Wire Fee

Scottrade Ratings

Overall
Commissions & Fees
Customer Service
Platforms & Tools
Research
Ease of Use
Offering of Investments
Education
Mobile Trading
Banking

Scottrade Awards

2015

Scottrade was awarded Best in Class for Customer Service, Investor Education, and Banking. They also received #1 Overall Client Experience for the fourth year in a row and #1 Email Support. Read the 2015 Online Broker Review.

2014

Scottrade was awarded Best in Class for Education, Mobile Trading, and New Investors. They also received #1 for Overall Client Experience and #1 New Tool for Scottrade FRIP. Read the 2014 Online Broker Review.

2013

Scottrade was awarded Best Overall Client Experience, rated 4.5 stars for Education, 4 stars for Customer Service, Research, and Ease of Use, and had several Top 10 Category finishes. Read the 2013 Broker Review.

2012

Scottrade was 5 Stars Overall and received Best in Class for Ease-of-Use, Customer Service, and Investor Education. In addition they were named Best Overall Client Experience. Read the 2012 Broker Review.

Offering of Investments

Yes CDs
Self-clearing Clearing Firm
0 Commission Free ETFs
Yes Corporate Bonds
Direct Market Routing - Stocks
Yes DRIPs
3500 # of Easy to Borrow Stocks
Forex Trading
Futures Trading
Yes No Fee IRAs
Yes Mini Options
Yes Municipal Bonds
Yes Mutual Funds
7095 Mutual Funds (Load)
7009 Mutual Funds (No Load)
2598 Mutual Funds (NTF)
14104 Mutual Funds (Total)
Yes No Inactivity Fees
No Minimum Deposit
Yes Options Trading
Yes Order Type - After Hours
Order Type - Algo
Yes Order Type - Broker Assisted
Yes OTCBB / Pink Sheets
503 Retail Locations
Yes Stock Trading
Yes US Treasury Bonds
Yes Weekly Options

Customer Service

Yes Phone Support
Yes Email Support
Yes Live Chat (prospect clients)
Yes Live Chat (current clients)
24/7 Support

Platforms & Tools

Yes Desktop Platform
Mac Platform
Yes Web Platform
ScottradeELITE Active Trading Platform
Auto Investing
Ladder Trading
Yes Level 2 Quotes - Stocks
Yes Option Chains - Basic View
Yes Option Chains - Strategy View
Yes Option Analysis - P&L Charts
Yes Streaming Time & Sales
Streaming TV
Yes Trade Hot Keys
Yes Virtual Trading

Research

Yes Research - ETFs
Yes Research - Mutual Funds
Yes Research - Pink Sheets / OTCBB
Yes Research - Fixed Income
Yes Misc - Global Market Overview
Yes Equity Research - News
Yes Equity Research - Chart
Yes Equity Research - Option Chains
Yes Equity Research - Balance Sheet
Yes Equity Research - Cash Flows
Yes Equity Research - SEC Filings
Yes Equity Research - Insider Analysis
3 Equity Research - Research Reports
Yes ETF Research - Top 10 Holdings
Yes ETF Research - Research Reports
Yes Mutual Fund Research - Research Reports
Yes Mutual Fund Research - Fees Breakdown
Yes Mutual Fund Research - Performance Analysis
Yes Mutual Fund Research - Performance Chart
Yes Mutual Fund Research - Top 10 Holdings
Yes Screener - Stocks
Yes Screener - ETFs
Yes Screener - Mutual Funds
Screener - Options
Yes Screener - Bonds

Education

Yes Has Education - Stocks
Yes Has Education - ETFs
Yes Has Education - Options
Yes Has Education - Mutual Funds
Yes Has Education - Bonds
Yes Has Education - Retirement
Yes Investor Dictionary
Yes Client Webinars
Yes Live Seminars
Yes Retirement Calculator
Community Forums

Mobile Trading

Yes iPhone App
Yes iPad App
Yes Android App
Android Tablet App
Yes Mobile Site
Yes Company Data
Yes Company News
Yes Watch List Syncing
Yes Options Chains Viewable
Market Movers (Top Gainers)
Barcode Lookup
Yes Charting - Multiple Time Frames
Yes Charting - Can Turn Horizontally
Charting - Portfolio Perf vs Indices
Charting - Stock Comparisons
Yes Trading - Stocks
Yes Trading - Simple Options
Yes Withdrawal Balance Available

Banking

Yes Checking Accounts
Yes Savings Accounts
Yes Debit Cards
Credit Cards
Mortgage Loans
Mobile Check Deposit
Yes ATM Fee Reimbursement
No Fee Banking

Active Trading

Internalizes Trades
Yes Receives Payment for Order Flow
Client Liquidity Rebates

Best in Class

Best in Class - Offering of Investments
Best in Class - Commissions & Fees
Best in Class - Platforms & Tools
Best in Class - Research
Best in Class - Customer Service
Best in Class - Ease of Use
Yes Best in Class - Investor Education
Yes Best in Class - Mobile Trading
Best in Class - Active Trading
Best in Class - Options Trading
Yes Best in Class - New Investors

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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.

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