E*TRADE Review

By Sam Bourgi  | September 18, 2017

Venerable online brokerage with comprehensive account features and related tools aimed primarily at individual retail investors

Overall Rating

4.2/
5.0
Products & Fees
4.4
Trust
4.3
Special Features
5.0
Desktop Experience
4.5
Mobile Experience
5.0
Customer Support
5.0
Research & Insights
5.0
Education
3.3
Banking
3.0

E*TRADE Fast Facts

With more than 30 years of experience, E*TRADE is one of the most established online financial brokers. As a full-service financial institution, it offers a variety of online trading accounts and mobile trading features aimed primarily at the retail investor. E*TRADE scores a 4.2 out of 5 from Investopedia thanks to its comprehensive asset selection, extensive research tools, and robust security features. This resume makes E*Trade an attractive option for investors willing to pay more for an established online brokerage that has all the bells and whistles.

pros

  • Commission Free Products
    Diversify your portfolio with commission-free ETFs, stocks, and options trades
  • Powerful Mobile App
    Trade on the go with a full-feature mobile platform
  • Diverse Asset Selection
    Invest in stocks, options, futures, mutual funds, and ETFs
  • Comprehensive Research & Education
    Make informed investment decisions with the E*Trade Research and Education portals
  • Customer Services
    Access to 24/7 customer support

cons

  • Fees
    At $6.95, the standard commission is above the industry average
  • Simulated Trading
    Does not offer a practice trading account before depositing real money
  • Advanced Account
    Access to advanced trading platform is limited to high-volume or high net-worth traders.
  • Forex Trading
    Currency trading is not available

Products & Fees

4.4

E*Trade offers a comprehensive list of investment products spanning stocks, ETFs, mutual funds, futures, bonds, and options. The platform also allows participation in initial public offerings (IPOs), although this is limited to U.S. residents and eligible accounts. E*Trade provides access to commission-free trading for specific investment products, such as ETFs. There’s a high barrier to entry for advanced traders looking to access the E*Trade Pro platform, which is based on a minimum account balance of $250,000 or 30 executed stock or options trades each calendar quarter. E*Trade’s commission structure is much higher than the industry norm. This applies to stock and options trades, options contract fees, ETFs, and mutual funds. Margin rates are also significantly higher for debit balances up to $750,000.

  • Stocks and ETFs*
    $6.95
  • Options**
    Base Pay + $0.75/contract
  • Futures
    $1.50/contract
  • Bonds (Online Secondary Trades)
    $1.00
  • Margin Rate***
    8.75%
  • Mutual Funds****
    Free
  • Broker-Assisted Trades
    $25
  • U.S. Treasury Auction
    $0
  • Online Secondary Trades
    $1 per bond (minimum $10, maximum $250)
  • Forex
    Not Available

Trust

4.3

E*TRADE customers can feel confident that their personal information, account data, and deposits are reasonably protected by the CompleteTM Protection Guarantee. This guarantee extends to fraud, payment, and privacy protection, including zero liability for unauthorized use of your trading account. Under SIPC, E*TRADE security accounts are protected for up to $500,000, including $250,000 for cash claims. In addition to SIPC protection, E*TRADE maintains insurance with an aggregate limit of $600 million. Cash deposits at E*TRADEe Bank are also insured by the FDIC.

What you need to know

E*TRADE is a pioneer in the online brokerage industry, having been in business for 35 years. It has the distinction of issuing the first-ever electronic trade by an individual investor in the early 1980s. As a fully regulated broker with more than 3.5 million accounts, E*Trade provides account holders with full protection against unauthorized use. The firm is also committed to a variety of corporate social responsibility initiatives, including contributions to nonprofit and local government partnerships. Its primary areas of focus are community development, economic development, and health and human services.

Special Features

5.0
Special Features

E*TRADE offers a myriad of account types spanning Brokerage, Retirement, Managed Solutions, and Small Business Retirement. In addition to those, the E*Trade OptionsHouse Platform is designed for highly active traders looking for cutting-edge account features. It is fast and powerful, and offers advanced charting, trading ladders, and options chains on an integrated mobile-desktop experience. Initial deposits of $10,000 or more are eligible to receive $600 plus 60 days of commission-free stocks and options trades.

What you need to know

The OptionsHouse Platform offers a tiered rewards program for more active traders. The size of the cash credits and number of free trades you get are based on your initial deposit or transfer from an external broker. To be eligible for the rewards, your account must be funded within 60 days. The $600 cash credit is normally reserved for deposits of $250,000-$499,999, but the current promotion extends the offer to deposits as low as $10,000. The promotion is valid for one new E*TRADE Securities non-retirement brokerage account opened by 12/31/2017. Your account will be credited within one week of depositing. The available credits may be subject to U.S. withholding taxes.

Desktop Experience

4.5
Desktop Platform Experience

E*TRADE offers an intuitive, easy-to-use desktop platform for the self-directed retail investor. Regardless of your goals or portfolio selection, E*TRADE provides a wealth of resources that can help you make informed investment decisions. Easily navigate among stocks, options, mutual funds, futures, bonds, and other investments on an attractive user interface that was clearly developed by and for traders. Beginners can also access a library of articles and videos in the Education section.

Pros

E*TRADE delivers a powerful desktop experience that makes researching and trading the financial markets simple. In just a few clicks, you can navigate among seven different asset classes, as well as IPOs and New Issues. Order execution and portfolio management are extremely easy on the sleek user interface. The new Move Money Center lets you consolidate all your accounts in one place, including managing external accounts and linking your bank account to your platform. You don’t have to go very far to conduct market research or review analyst recommendations. Each time you select an asset or initiate an order, you will be able to pull up the asset using the charting software.

Cons

The charting software lacks many of the technical indicators and studies that some advanced traders may seek. The platform is also devoid of simulated trading, which means you will not be able to practice before depositing real money.

Mobile Experience

5.0
Mobile Platform Experience

The E*TRADE mobile application mimics the desktop trading platform by providing rich features and an easy-to-use interface. A feature-rich dashboard combines with live streaming of CNBC to deliver a top-notch mobile app that complements the flagship desktop platform. Investors looking to trade on the go will find plenty of intuitive features on the E*TRADE mobile app. They can also access the desktop version of their account through Safari (Apple) or other mobile web browsers.

Pros

The mobile app provides a simple yet sophisticated interface for investors seeking a handheld version of their desktop trading account. The mobile app makes research and real-time quotes easy to navigate, while the integration of CNBC video is a solid added value for active investors. In addition to the E*Trade app, you can download the OptionsHouse app to execute options strategies. The OptionsHouse app provides interactive charts as well as streaming quotes, earnings, and news releases.

Cons

Trading is limited to stocks, ETFs, mutual funds, and options. Although we live in a world dominated by Android and iOS, users of the Windows phone and even tablets such as iPad and Kindle Fire should be aware of the potential loss of functionality on these platforms.

Customer Support

5.0

When it comes to customer support, E*TRADE offers many avenues for communication, including 24/7 brokerage assistance. By accessing customer service directly from your account, you can send secure messages, upload documents, and update your account information.

What you need to know

While E*TRADE does not skimp on live customer support, it also provides many do-it-yourself options. Users get direct access to a customer service portal on their account, which has sections dedicated to self-service, FAQs, education, and document upload. If none of these selections will suffice, you are free to call the 24/7 phone number or submit a secure message. You can also submit online requests without having to talk to a representative.

Research & Insights

5.0

E*TRADE is ideal for the fundamental investor, as it provides full access to analyst ratings, financial statements, and asset screeners. Technical traders also have a variety of advanced charting features at their disposal. The platform provides analyst recommendations and planning tools that can help investors align their portfolios to specific goals and objectives. These features more than make up for the limited customization options on the main dashboard.

OptionsHouse
Advanced trading platform that provides trading ladders and customizable options chains
Analyst Ratings
Active third-party research ratings for various investments
Technical Analysis Charting Tools
Advanced charting tools with various technical indicators and studies
TipRanks Recommendations
Stock recommendations provided by TipRanks
Investing Ideas
Investment ideas by market activity, trends, and fundamentals
Planning Tools
Tools and calculators for retirement, investment selection, and portfolio diversification

Pros

E*TRADE offers a strong selection of tools and resources for the active investor. This includes U.S. and globally focused research, financial statements, market news, technical charts, recommendations, and insider trading updates. The platform also provides a Plan & Invest section, which allows you to set goals, plan for retirement, and explore your margin trading options. A detailed economic calendar also provides the latest releases on earnings, economic data, dividends, IPOs, and market conferences.

Cons

The Market News section draws only from one source, MarketWatch (the global news section draws from Reuters). Aside from Portfolios and Watchlists, dashboard customization is limited.

Education

3.3

Very few online brokers can say they have been in business for 30-plus years. E*TRADE is one such broker that has withstood the test of time. Today, its trading platform is powerful enough to whet the appetite of the most advanced trader, while still being accessible to novices and casual investors. In-depth research, abundant tools and resources, and round-the-clock customer support make E*Trade an attractive choice for many investors. Seamless integration between the mobile and desktop platforms provides additional value for market participants on the move. However, when compared with the industry average, these tools come at a significantly higher cost, which is offset only when one has abundant capital to trade.

What you need to know

While E*TRADE was designed with the advanced trader in mind, it contains informative educational tools and resources, including a combination of articles and videos, that are suited for beginners. The Education section is in-depth but not overwhelming, allowing novices to focus on core principles related to their investment success. You can filter educational resources by format type, and start and stop lessons as you see fit. In addition, more advanced traders can learn how to navigate the OptionsHouse platform.

Banking

3.0

In addition to running a state-of-the-art online brokerage, E*TRADE offers online banking services with competitive yields. The promise of low-fee checking is a strong value proposition for existing E*Trade investors. E*TRADE Bank safeguards client accounts by way of the CompleteTM Protection Guarantee – a trifecta that protects your account against fraud, privacy breaches, and misuse of payments. If you are looking to go above and beyond the standard E*Trade Checking account, the Max-Rate Checking account has an annual percentage yield of 0.05% on accounts with $50,000. APY begins with the first dollar you deposit at a rate of 0.01% up to $4,999 before rising to 0.05% on account balances between $5,000 and $49,999.

What you need to know

E*Trade is an established brand that has been in operation for 35 years. This means that users can feel confident that E*Trade banking services offer the same insurance protection as other regulated financial services companies. All checking accounts are insured by FDIC to at least $250,000. For the Max-Rate Checking Account, the $15 monthly fee is waived on average monthly balances of $5,000 or more.

Bottom Line

Access to educational resources is essential for successful value investing. E*TRADE provides a wide selection of informative videos and articles that introduce traders to essential financial concepts. Although the Education section is primarily geared toward beginners, it also shows experienced traders how to get started with the advanced OptionsHouse platform. The sections are broken down into the following categories: Getting Started, Stocks, Options & Futures, ETFs & Mutual Funds, Bonds & Fixed Income, Retirement & Planning, and Stock Plan.

Sam Bourgi
Reviewed by Sam Bourgi

Sam Bourgi is Contributing Writer to Investopedia.com, where he brings eight years of progressive experience in economic research, financial market analysis and public policy. An expert analyst, writer and financial market commentator, Sam has been featured in some of the world's leading financial news outlets, including Barron's, CBOE and MBA. Serving both industry and government, he has produced authoritative reports covering finance, labour and technology. He holds a Master’s Degree in Public Policy from McMaster University, with a focus on economic policy and global political economy.

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