TradeKing is considered as one of the top online discount brokers. However, just like in anything, before jumping and signing up in this online firm, you better do your research right first, and later on, decide whether or not this is the right firm for you.
It is probably safe to say that more and more people today, especially the millennials are becoming financially literate. Unlike before, today’s younger generation is wiser when it comes to their money. They know how to handle it, at the same time, where to put it to ensure a good return.
Having said that, it is not surprising that more people are researching and becoming more interested in different investment platforms – more so, interest is rising in knowing what brokerage is the best to deal with.
Thanks to the advent of digital technology and the internet, today, investing has never been easier. More so, following and checking how your investments are going (and we mean stocks, etc.) became a breeze. In fact, in just a click of a finger, almost all the information becomes readily available for you.
Now, when looking for the right partner, and we mean, the right online discount brokerage, both old and up and coming investors look for certain points to consider, which include the fees, minimums, and costs associated with having an account. These and more are exactly what we are going to look at as we do this TradeKing review.
By the way, TradeKing, as we have mentioned earlier, is one of the top online brokerage discount firms in the country today. Needless to say, we have heard that they are consistently good when it comes to customer service. Also, they have an amazing set of online tools to use. But, this is not a review if we are not going to look at its every angle ourselves.
So, with that, here are some key points we are going to look at with TradeKing:
– Brief Background
– Awards and Recognitions
– Fees, Commissions, and Minimums
– TradeKing Tools and Features
– TradeKing Community
– Customer Service
If you are ready, let’s start.
TRADEKING BRIEF BACKGROUND
TradeKing was launched in 2005. Like we have said earlier, the firm offers online brokerage services particularly for active stock and options traders.
TradeKing is known to be one of the first users of social networking for its traders and investors. It offers free blog support, and other Web 2.0-based tools to their registered members, as well as account holders.
Since its inception, TradeKing has become one of the top online discount brokers in the country. It has gained popularity because of its $4.95 trade commission, which ultimately is one of the lowest in terms of cost when it comes to discount brokerages.
The firm evolved since it was first launched, and eventually gave birth to the TradeKing LIVE, which is a web-based trading platform available for use of its account holders.
TradeKing offers real-time data and streaming quotes, and personalized workspace. More so, it added new features like option tools and advanced charting, which makes it even more competitive alongside premium platforms.
The TradeKing LIVE is such a great platform, and is very ideal for the following types of traders and investors:
- Active stock traders
- Advanced traders
- Options traders
- Fee-conscious investors
By the way, TradeKing is an official member of the SIPC, which basically means your investments are protected by SIPC insurance for up to $500,000 and that $100,000 of it can be in the form of cash. So, in case of the firm going into insolvency (which, at the moment, is definitely far from reality), you are protected. Your hard-earned money is protected. However, when it comes to market losses that is a totally different thing.
In 2016, however, the firm was eventually sold to Ally Financial, which, according to Investment News, is “an online financial service firm for automotive financing, banking, and insurance”. It was said to have bought TradeKing for approximately $275 million.
If you are interested to know more about TradeKing, you may want to check this video down below:
TRADEKING AWARDS AND RECOGNITIONS
TradeKing is not considered as one of the tops on its line of business if not for the many awards and recognitions it got over the years. These, in fact, are the reasons why they are considered great in their field.
To give you an idea, some of the notable awards and recognitions the firm has received are as follows:
- In 2010-2012, Smart Money rated TradeKing no. 1 in customer service
- In their 2011-2012 Annual Review of Online Stock and Options Brokers, Barron’s ranked TradeKing no. 1 for site usability
- Ranked third out of 19 brokerages reviewed by Consumer Reports in an independent survey conducted in May 2007
- The firm earned four stars in three-years (2007, 2008, 2009) in Barron’s Annual Survey of the Best Browser-Based Online Brokers
TRADEKING FEES, COMMISSIONS, AND MINIMUMS
Regardless if you are an expert or a total newbie on this thing, song of the most important things that you’ll probably have to consider especially when it comes to opening an online brokerage account are the fees, commissions, as well as the minimums. These are key so you know what to expect.
So, having said that, here are the “key” information regarding opening an account with Tradeking:
– Stock Trades
Just a quick information-sharing especially for the newbies in this field, as a stock trader, according to NerdWallet, you basically is someone “who frequently buys and sells stocks to capitalize on daily price fluctuations.”
Now, we have already mentioned this a couple of times, but we are saying it again. TradeKing is one of the lowest rates for stock trades in the industry. Stock trades only costs $4.95. You see, that is value for money.
The rate goes no matter how many shares you purchase or regardless if it is a broker-assisted kind of trade.
If we are to compare it to some of its competitors like ShareBuilder or OptionXpress, both firms’ stock trades cost at $9.95 per trade. So, if you come to think of it, TradeKing definitely is a decent deal.
– Option Trades
Before we talk about how much TradeKing option trade costs, let us, first and foremost, define what options trade means.
For those who are unfamiliar with the term, according to the blog site called, Ally, “Options trading is a self-directed way to invest for those looking to diversify. But getting started isn’t easy, and there’s potential for costly mistakes.”
Furthermore, The Street defines option as “a contract that allows (but doesn’t require) an investor to buy or sell an underlying instrument like a security, ETF or even index at a predetermined price over a certain period of time. Buying and selling options are done on the options market, which trades contracts based on securities.”
Now, back to TradeKing Option Trades. When it comes to option trading, the firm charges $4.95 per trade, plus an additional 65 cents for every contract. Again, if you compare it to their competitors in the online discount brokerage industry, they definitely are one of the lowest ever.
What makes it even more enticing is that TradeKing automatically lowers the price to $8.95 if you trade more than 8 contracts plus an additional 15 cents per contract. Note that there is only one base charge for multi-leg option-only trades. Such a great deal, right?
– Account Fees and Minimums
Unlike other online discount brokers, TradeKing does not have any account maintenance fees, as well as inactivity fees, and monthly minimums. The firm also does not charge additional charges for brokers-assisted trades. However, if you want to know more about their full list of “other” fees, you may head on to their website.
In addition, the firm also does not have any minimum account funding level to be able to open a cash account. When opening a margin account though, they have a $2,000 minimum amount requirement.
For your reference, here’s a comparison between TradeKing and other popular brokerages:
|Brokerage||Stock Trade Commission||Option Base Rate + Commission|
|Ally Invest (TradeKing)||$4.95||$4.95 (+$0.65)|
|Motif Investing||$4.95/stock – $9.95/motif|
|Capital One Investing||$6.95||$6.95 (+$0.75)|
TRADEKING TOOLS AND FEATURES
Since TradeKing was launched back in 2005, it strived to make trading online as straightforward as possible, which is pretty much reflected in its trading platform. While it is not the most innovative trading by any means, we have to say that it does what it needs to do, and it pretty does well.
For the most part of the platform, we have to say that it is very user-friendly. The process of placing orders may not be as easy as it can be, but it is also far from being difficult. Making simple and advanced trade from your account was made simple as all options order types are covered.
More so, when it comes to tools, TradeKing has a variety of trading tools. One example is the MarketGrader’s research reports. It also includes tools like interactive charts, tax reporting tools, probability calculators, profit and loss calculators, free technical analysis tools, options calculators, options strategy scanner, and stock screener.
According to the firm, their full suite of tools is one of the biggest reasons why Barrons gave them a 4-star, being one of the top web-based brokers in 2008.
TradeKing takes pride that they pretty much have a ton of tools that is available for everyone to use. We love the fact that they do not run out of research, tools, as well as calculators to help you in making the most informed decision when it comes to trading and investing.
Unlike other online brokerage services, one thing that makes TradeKing standout is its well-run blog and forums. Both serve as an amazing platform where you can learn and get information from. It allows you to chat with other traders, asks for advice, gets tips and tricks, as well as learn from fellow investors.
Furthermore, they also have a section for groups where anyone can join other beginning investors, as well as option traders, or those people who wanted to specialize in different forms or types of investments like penny stocks, ETF’s, hedge funds, value stocks, dividend stocks, and various segments of the market, which include automotive, biotech, or individual companies.
PROS AND CONS OF TRADEKING
This is not a review if we are not going to pinpoint the pros and cons of joining TradeKing. So, with that, here are some of what we think are the firm’s highs and lows.
– Browser Access – We find this Web-based platform really amazing with ease. If you are someone who frequently trades using various computers, you will surely like this one. It does not require any downloads, which is why we love it.
– Commissions – Apart from the fact that TradeKing’s commissions are low, they’re clear cut as well. The brokerage charges $4.95 for stock as well as ETF trades, and options are just $4.95 with an additional 65 cents for every contract. If compared to another brokerage, this is definitely a lot cheaper.
– Options Trading – The firm has improved its platform to be able to address the needs of its traders. They do have additional features, which include strategy workbench to help traders quickly analyze all options contracts in a strategy. They also have calculators to help in assessing the likelihood of stock, an ETF or index hitting a target price based on a date set, and they also have tools that help traders analyze the profit and loss of potential trade in the years to come.
– Easy Navigation – The TradeKing LIVE, which we mentioned earlier has everything a trader needs. We find it clean. More so, it is very streamlined and can be personalized. Also, users can move modules on the dashboard to organize the information the way they want it. Overall, we find it really very easy to work on, and we live the fact that it gives you almost everything you need right there.
– Charts and Research – The platform has expansions, which include more than 80 technical indicators as well as the ability to compare symbols. It also has a research center, it features real-time news from Benzinga, and all TradeKing traders/customers have access to MarketGrader research reports, which is really very helpful.
– No Mock Trading – We found that TradeKing LIVE does not have paper trading technology, which would have been better and more accessible especially for new traders. More so, it would allow traders to practice strategies without any risk involved.
– Account Minimum – For the active traders, hitting the account minimum will not be a problem. But we find it worth pointing out as TradeKing LIVE is only accessible if a user maintains a $2,500 account balance or execute one trade annually. Unfortunately, TradeKing charges $50 for inactivity fees to traders who are not able to meet the minimum.
– Commission-free ETFs – Unfortunately, TradeKing does not offer any ETFs commission-free. Also, all ETF traders are subject to a $4.95 trade fee.
TRADEKING CUSTOMER SERVICE
Unfortunately, there is no 24/7 customer service at TradeKing. However, it’s not a big deal at all because the kind of service they provide is still of a high standard.
If you have questions or clarifications, they can be reached through the phone from Mondays through Fridays, between 8 in the morning and 6 in the evening (EST). Yes, they do not have live chat available. But, they do have email support that guaranteed a response within 2 hours provided it’s within their working hours. On weekends, they do have a 24-hour guaranteed response time.
Based on customer reviews, we found that customer service support staff at TradeKing are both knowledgeable and helpful. As compared to other brokerages, TradeKing’s customer support is definitely better.
FINAL THOUGHTS ON TRADEKING
Overall, there is so much to like about TradeKing as to things not to like about it. We find its online platform really easy to manage. Also, we like the fact that it allows its investors to take advantage of its low commissions on a customizable, comprehensive, and feature-rich platform without having to worry about additional fees or charges.
The platform itself — by the way it looks — is very attractive to option traders. Needless to say, the addition of MB Trading to the firm’s line up will only bring nothing but great things and opportunities.
So, how do you find TradeKing so far? Are you already thinking of joining and using the platform as you jump into investing? If you are someone who’s already using other platforms, given what we have shared earlier, do you already think of jumping into TradeKing? We’d love to know your thoughts!