TradeStation Review

By Sam Bourgi  | October 23, 2017

A platform for tech-savvy investors who have no qualms about maintaining a high minimum balance.

Overall Rating

3.6/
5.0
Products & Fees
3.5
Trust
4.2
Special Features
5.0
Desktop Experience
4.0
Mobile Experience
5.0
Customer Support
3.1
Research & Insights
4.7
Education
2.7

TradeStation Fast Facts

For more than 35 years, TradeStation has been the online brokerage of choice for advanced traders seeking comprehensive investment options. Catering to the affluent and experienced investor community, the brokerage has earned a solid reputation for providing a professional-level experience without compromising on advanced features. Its commitment to excellence is reflected in its numerous awards and accolades, including a 15-year streak atop the Best Professional Platform list courtesy of Technical Analysis of Stocks & Commodities magazine. Traders actively engaged in stock, options, futures and even forex trading can rely on TradeStation to meet their needs.

pros

  • Positive Reviews
    Glowing feedback from traders and professional reviewers
  • Advanced Tools
    Advanced charting features for in-depth market analysis
  • Competitive Per-Trade Fees
    Flat $5 fee for stock trades, ETFs, and options
  • Options Bonus
    Free real-time data on options trading

cons

  • Service Charges
    Hefty monthly service fee for traders who don’t meet lofty minimum activity requirements
  • Pricey Broker Assistance
    Broker-assisted transaction fees are much higher than the industry average
  • ETFs and Mutual Funds
    Lack of commission-free ETFs and no-transaction-fee mutual funds
1982
First Online Trade
(as Omega Research)
2011
Acquired
(Parent company is Japan's Monex Group, Inc.)
7 years
Barron’s top rated brokerage for frequent traders
(7 years running)

Products & Fees

3.5

TradeStation offers a wide selection of investment products spanning ETFs, mutual funds, stocks, options and even forex. A minimum initial deposit of $500 gets your foot in the door, with a $2,000 commitment required for margin accounts. The broker recently introduced a simplified pricing model for its stock, options and futures trading. To entice traders, it added free market data and dropped the software fee on its accounts. It also provides commission-free forex trading, opting instead to generate revenue through spreads. However, the same conditions do not apply to ETFs or mutual funds. All ETFs are subject to a commission fee, while mutual funds transactions are $14.95 per trade. An inactivity fee of $50 is applied to accounts that fail to meet the minimum trading requirements of at least five trades annually or the minimum end-of-month equity balance of $2,000.

Accounts are subject to a monthly service fee of $99.95 that is waived under the following conditions:
• 10 round-turn futures and/or futures options contracts; or
• 50 options contracts traded; or
• 5,000 shares traded; or
• $100,000 account balance

  • Stocks & ETFs
    $5 per trade
  • Options
    50¢ + $5 per contract
  • Futures
    $1.50 per contract, per side
  • Mutual Funds
    $14.95 per trade
  • Bonds
    $14.95 per trade

Trust

4.2

In terms of trust and transparency, TradeStation is among the world’s most respected online brokerages. Owned and operated by Monex Group Inc., a Tokyo Stock Exchange–listed company, TradeStation is well capitalized and in good standing. It is also a member of the New York Stock Exchange and CME Group, and registered to conduct business in 50 states plus the District of Columbia. The brokerage is registered with the Securities and Exchange Commission (SEC) and is in good standing with the Financial Industry Regulatory Authority. Having been in business for more than three decades, TradeStation has withstood the test of time in an industry that often sees high turnover.

$500,000
SIPC Insurance
($250,000 in cash)
$24.5 Million
Additional Insurance
(Lloyd’s of London insures each account up to $24.5 million, subject to $900,000 maximum for cash)

What you need to know

Since TradeStation is not a bank and does not offer products such as certificates of deposit, it is neither a member of nor insured by the Federal Deposit Insurance Corporation (FDIC). As a member of the Securities Investor Protection Corporation (SIPC), TradeStation accounts are guaranteed for up to $500,000, including $250,000 in cash, in the event of bankruptcy or failure.

Special Features

5.0
Special Features

If you’re an advanced trader or have a background in I.T., TradeStation offers unique advantages that few in the industry can replicate. The brokerage provides a comprehensive suite of professional-grade tools, allowing you to scan the market for opportunities easily and efficiently. Tech-savvy users also have the unique opportunity to customize their own trading strategy through EasyLanguage, a programming language developed exclusively for TradeStation. With EasyLanguage, you can build and customize your own set of analytical tools, tailored to your specific trading methodology.

Easy Language
Customize trading indicators using programming language
TradeStation University
In-depth resources, webinars, and e-books
Split-Second Execution
Place, modify, and execute trades in a split second
(Via TradeStation Network)

What you need to know

Depending on your experience and level of knowledge, all of TradeStation’s special features may not be relevant to you. However, you will likely grow to appreciate the brokerage’s vast infrastructure, which includes the TradeStation professional-grade platform and Web Trading tool. RadarScreen – a real-time scanning and ranking tool – is also included for free.

Desktop Experience

4.0
Desktop Platform Experience

The TradeStation desktop platform is the gold standard of online trading. It has been recognized by StockBrokers.com, Barron’s, and Investor’s Business Daily as being one of the best available online trading programs. TradeStation offers similar capabilities through its Web Trading tool, which lets you access your account from anywhere.

Pros

TradeStation’s desktop platform has been designed with the advanced trader in mind, leaving no stone unturned in its pursuit of comprehensive tools and indicators. The desktop trader offers direct-market access, hundreds of indicators and automatic trade execution. It is also equipped with Simulator, which allows you to test-drive the market, risk-free, without committing real money. By utilizing EasyLanguage, you can make your desktop experience all the more powerful through customization.

Cons

If you are not an active trader, you will likely find TradeStation less attractive from a cost perspective. Additionally, the desktop platform does not integrate the broker’s other features, such as University, which means you’ll have to navigate to a different screen to complete a related task. Although this isn’t necessarily a con, other online brokers provide a more integrated experience.

Mobile Experience

5.0
Mobile Platform Experience

The TradeStation mobile app provides the core features of its flagship desktop platform. Available via Android and iOS, the app syncs directly to your online account, giving you real-time access to the market 24 hours a day, seven days a week.

Pros

TradeStation Mobile gives you a handheld version of your desktop trader account. The app allows you to monitor quotes, place orders, analyze charts and check your positions as if you were on the desktop version. Availability on both major mobile platforms is also a big plus.

Cons

Like other mobile apps, TradeStation Mobile runs into issues when it comes to optimizing charts and columns. The platform isn’t necessarily to blame for this, as usability generally declines on a much smaller trading screen. For that reason, the mobile version may be best for monitoring your positions or utilizing one-click trade execution rather running complex charts or analytics.

Customer Support

3.1

Users are backed by TradeStation’s Client Services and Technical Support, which includes 24-hour technical assistance between Sunday and Friday and extended client services hours. Live chat and email support are also provided to existing and prospective customers. For the do-it-yourself investor, TradeStation has developed a comprehensive FAQ section that answers questions related to account features, software and security.

What you need to know

TradeStation provides two lines of support for its Retail and Institutional clients. In 2017, the brokerage took home the “Best in Class” customer service award issued by StockBrokers.com. In 2016, Investor’s Business Daily named TradeStation the third best broker for overall customer experience.

Research & Insights

4.7

The brokerage’s commitment to excellence is reflected in the stockpile of advanced research tools offered through its platform. Investors can evaluate the market from the bottom up using the TradeStation Research Window, which is powered by Reuters fundamental data. The cockpit-style platform comes fully equipped, with over 1,000 fundamental data fields and more than 24 independent research links, to help you broaden your analytical scope. Through EasyLanguage, TradingApp and third-party add-ons, traders can access hundreds of additional analytical applications to build their portfolio.

Automatic Trade Execution
Lightning fast order execution and price-improvement opportunities
RadarScreen
Real-time scanning and ranking of financial assets; timely technical/fundamental analysis
OptionStation Pro
OptionStation Pro to analyze options and spreads using powerful charts
Interactive Charts
150+ indicators and multiple time-frame analyses
Comprehensive Asset Solution
Stocks, options, ETFs, mutual funds and forex all come fully loaded
Simulator
Test-drive TradeStation before becoming a paid member

Pros

Whether you are investing in domestic or international assets, TradeStation provides quick access and powerful analytics to drive your portfolio. While the platform is best known for its advanced desktop trader, it can be accessed through a web browser or mobile device, ensuring that you are always connected to your portfolio. Both existing and prospective clients can use the Simulator to try new trading strategies before committing real money. Finally, TradeStation features a dizzying array of indicators and data fields, which makes it one of the most advanced platforms for retail traders.

Cons

It’s often said that you get what you pay for. This aptly describes the platform service fees for TradeStation, which run $99.95 monthly. The brokerage also falls short by not offering any commission-free ETFs and very little research into this burgeoning market. From a platform perspective, TradeStation may appear intimidating at first, especially for novice traders or those who’ve had very little exposure to deep market analytics. Web Trading University and Client Center must be accessed separately, so don’t expect to toggle back and forth with ease.

Education

2.7

Though designed with the advanced trader in mind, TradeStation offers a bevy of educational resources for beginners still learning the ropes. This is exemplified through TradeStation University, which includes comprehensive trader education, webinars and platform tutorials. In addition to watching educational videos, you can also tune into the Morning Market Briefing, a special pre-market online program presented each weekday from 9:00 to 9:30 a.m. ET.

Live Webcast Series
Learn about the markets
(Interact with instructors and other traders)
Morning Market Briefing
Start your day with a market rundown
TradeStation University
Self-paced educational videos
(Learn at your own pace by selecting the educational videos that are most important to you)

What you need to know

There are plenty of opportunities on TradeStation to learn about the financial markets and stay current with the latest developments. University also includes the Learning TradeStation course, a 12-part series on how to get started with the platform. If you’re a beginner, it is a great way to get up to speed.

Banking

TradeStation is not a bank, which means it does not fall under the jurisdiction of the Federal Deposit Insurance Corporation (FDIC). However, the platform offers several investment accounts, including Individual, Joint, IRA, Entity and Custodial. You are free to fund your TradeStation account through wire transfer from your existing bank or brokerage accounts.

Safety of Funds
Your Funds are Safe
(TradeStation does not engage in any proprietary trading)
Equities/Options Accounts
Fund via wire transfer, check, and electronic transfer
(Three Easy Ways to Fund Your TradeStation Accounts)

What you need to know

TradeStation is governed by SEC Rule 15c3-1 (“Net Capital Rule”) and SEC Rule 15c3-3 (“Customer Protection Rule”), which protect customer assets and minimize the chances of financial failure. As of March 31, 2017, TradeStation had a net capital of nearly $76 million, which was roughly $72 million more than its legal requirement under SEC Rule 15c3-1.

Bottom Line

TradeStation has earned a solid reputation, and its numerous accolades convey what we’ve been saying all along: It’s a great choice for serious investors. But that’s not to say beginners should pass it up. TradeStation has gone to great lengths to make its platform accessible to investors from all walks of life. The Learning TradeStation course that’s available through University, combined with the free Simulator, provides you with all the resources you need to learn the ropes – as long as your pockets are deep enough to absorb the higher monthly payments. That being said, cash-strapped traders, charting minimalists and those who favor ETFs can certainly find more competitive offerings elsewhere.

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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