TradeStation's focus on high-quality market data and trade executions and their commitment to superior customer service makes them a good choice for the active trader. Their systems are stable and remain available during market surges. Technical analysis and statistical modeling of trading strategies is another strength of the TradeStation platform. You can develop your own automatic trading system using the analysis tools and strategy backtesting. You can also generate income through the fully-paid stock lending program and enhance your trading skills with the extensive educational offerings.
TradeStation currently ranks in the following categories:
In October 2019, TradeStation launched TSgo, which offers commission-free trading to customers using their web-based platform and mobile apps. TSgo allows clients to trade stocks (including OTCBB/penny stocks, which is unusual) and ETFs for no fee, charging $0.50 per contract for options transactions. TSgo clients cannot, however, use the powerful downloadable TradeStation platform with all its modeling bells and whistles.
Stable platform that has very little downtime
Excellent charting and technical analysis tools
Portfolio Maestro analyzes performance in a variety of ways
Education content is top notch
Steep learning curve to be navigated to develop your own trading system
Multiple pricing choices that can be confusing
Fixed income transactions must be made with a broker
No forex trading and limited international trading
The first screen you'll see after logging into either the downloadable platform or the web platform is TradeStation Today, which includes featured videos, links to workspaces, the firm's Twitter feed and an economic calendar. The desktop platform, which is a downloadable app, is extensively customizable; the web platform has most of the TradeStation toolset and is a little easier to use. All data streams in real-time. You can place, modify, and cancel trades from charts or by using keyboard shortcuts. TradeStation’s trade ticket is called Matrix, and it adapts to the asset class you’re trading. Hovering your mouse over a bid or ask price opens a trade ticket, which you can then modify prior to sending the order.
TradeStation’s order routing engine is based on an assumption that what is displayed in the “market depth” (the price and size of the order) is what is actually available, although with the proliferation of dark pools and hidden orders, there is more liquidity than can be seen with the naked eye, and therefore there is more opportunity for price improvement and better execution quality than what is displayed. Their orders are routed to seek out and capture as much price improvement and hidden size as reasonably possible within a reasonable period of time while being mindful of market impact. TSgo's orders use the same execution engine.
The sheer number of analytical tools available on TradeStation means there is a learning curve to deal with, but every iteration of the platform has made it easier to use. There are toolbars at the top and on the right of the screen that are the same wherever you are, so you don’t have to figure out different settings depending on which tool you’re using. You can save your watchlists on TradeStation’s server, so you have the same set of quotes no matter which platform you use. The customizability of this platform, from the colors to trading defaults, offers you the ability to really make it your own.
The web platform has many of the tools and capabilities of the downloadable system, except for the ability to construct your own trading system, or to use systems built by others and made available on the TradingApp store.
Mobile and Emerging Tech
Like the desktop platform, all prices on the mobile app are streaming in real-time. What’s more, all options strategies can be traded from the mobile app. There are numerous customization settings for the mobile app, including bypassing a trade confirmation for faster order entry. The mobile apps synch to your desktop or web-based platform, including charting customization settings.
The firm added 22 new chart studies to the mobile app over the last year, including Ichimoku clouds. The “Hotlist” tool, which shows major market movers, is included with the mobile app. You can interact with a chatbot on Facebook Messenger.
Range of Offerings
TradeStation lets you trade equities, including bulletin board stocks, as well as a wide variety of options strategies. There is a limited universe of mutual funds that you can trade online. Fixed income products can be traded through a live broker. TradeStation dropped its forex trading capabilities a few years ago. You can trade IPOs through TradeStation’s partnership with the ClickIPO app.
News and Research
OptionStation Pro is built into the downloadable platform, which is a flexible way to analyze strategies and place orders. The graphical display gives you a picture of the potential profitability of a strategy, which you can adjust in the trade ticket at the bottom of the screen. RadarScreen is an incredibly flexible stock scanner, which lets you create stock screens based on technical and/or fundamental criteria. TradeStation’s historical data set is second to none, with over 50 years of daily history, 27 years of minute history, and 6 months of tick by tick history. There are no analyst reports available, however, though TradeStation’s in-house market commentary, called TradeStation Market Insights, is available in the desktop platform and is updated five to ten times during the trading day.
Portfolio Analysis and Reports
TradeStation's Portfolio Maestro offers advanced analytics to optimize your trading strategies. You can analyze your portfolio as a whole, or compare the performance of different strategies or groups of symbols. Find out what is working and keep it up, or find out what's not working and fix it.
Customer Service and Help
There is a minimum of $500 to open a cash account, though you can test drive the platform with delayed data. Clients can opt into TradeStation’s fully paid lending program, which lets you generate income by loaning your shares of stock held long to a short seller. It’s surprising that a firm with such great risk management tools doesn’t yet offer portfolio margining.
TradeStation offered more than 300 webinars in 2018, including lessons on placing trades, available asset classes, technical analysis, and options trading. They added to their YouTube channel’s video content and have been offering five-day “Master Class” events in Chicago and Plantation, Florida. You’ll find live education events streaming on all platforms on topics such as using margin, trading ETFs and IPOs (initial public offerings), and cryptocurrencies. The firm is building out an electronic campus for its TradeStation University, offering courses over a variety of learning tracks, that include content focusing on a particular topic along with quizzes to test what you’ve learned.
You can choose from several different pricing tables, depending on what you trade and how frequently you trade. A standard trade of 500 shares is $5. If you trade frequently in small blocks, you might consider per-share pricing, which starts at $0.01 per share. Options transactions are near the average for the brokers we reviewed, while margin rates are slightly above average until you get up into 7 figures.
TSgo clients pay no commission for trading U.S.-based equities (including OTCBB/penny stocks), and $0.50/contract for options trades. All other commissions are the same, as are margin rates.
What You Need to Know
TradeStation has put a great deal of effort into making themselves more attractive to the mainstream investor, but the platform is more geared toward the active, technically-minded trader. Going forward, they plan to launch a digital asset trading platform, and an updated futures options platform later this year. If that's the direction you'd like to grow into, take a look at TradeStation.
TradeStation's focus on research and trade executions make them a great choice for active traders. See how they compare against other online brokers we reviewed.
TradeStation Broker Review 2019
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