Richard Montana | August 2, 2022
E*TRADE is an established US broker with a vast selection of investment products, intuitive platforms and advanced trading tools. With an easy-to-use website and friendly guidance available to assist you along the way, there’s no need to feel overwhelmed with E*TRADE. You can put your money to work in the easy-to-manage brokerage account desgined specifcially for investing and trading. It allows you to easily buy and sell stocks, ETFs, mutual funds, options, bonds, and more. I like how they have lots of easy-to-use trading tools to help make investing easy. You’ll get access to a full suite of investment choices with personalised ideas of what to invest in and help whenever you need it. It only takes around ten minutes to open an account and they make you feel right at home so that you can make informed decisions and invest with confidence. Despite the many positives, I did find the funding options and trading assets to be somewhat limited when compared to some other USA brokers, whilst they do not offer CFD and crypto trading. That being said, I think they are suitable option for beginners who are just looking for a simple way to trade stocks online with minimal fuss.
Pros & Cons
- Great range of investment choices
- Low trading fees (free stock and ETF trading)
- Intuitive trading platforms for all of your devices
- Advanced trading tools for detailed market analysis
- Innovative portfolio-building tools
- Abundance of educational resources to help beginners
- Excellent customer support
- Limited countries accepted
- No forex, cryptos or CFDs
- No fractional shares investing
- Limited funding options
E*TRADE is a leading online US Broker that offers online stock, exchange-traded fund (ETF) and options trading with $0 commission (additional fees may apply, subject to terms and conditions). The broker offers services for investors, traders, advisors, stock plan participants, stock plan administrators and more. You can trade with them self-directed or via the automated portfolio management options. They are owned by Morgan Stanley who are a global leader in executing transactions in cash equity and equity-related products for institutional clients around the world. These products include common stocks, global depository receipts and exchange-traded funds.
Founded in 1982 by a physicist and inventor, E*TRADE is headquartered in New York City and has around 4,000 employees with 30 retail branches across the United States. They were amongst the first online brokers to send a transaction to the exchange. This helped to pave the way for many investors to start conducting their investments online. The broker aims to make the investment process easy and are on hand to help investors make informed decisions dependant on their individual goals with professional guidance.
They work alongside multiple market centres for end-to-end control over orders in order to help them provide the highest possible execution speeds and quality. They have a team dedicated to regular and intensive reviews to help find the right balance between execution price, speed, and price improvement. The broker utilises advanced order routing technology in an effort to find the best possible market execution available. I found them to have very competitive trading conditions backed by some of the biggest and most reputable names in the industry. You can enter the market with superior pricing and low fees, via easy to use platforms that are suitable for all levels of investor.
How to buy a stock with E*TRADE?
- Apply for an account online in just a few minutes
- Add funds to pay for the shares you want to buy
- Use free analyst research and investing tools
- Place your trade with the intuitive website and mobile app
When it comes to choosing a broker, one of the first things that I look for is regulation. I would always prefer to trade or invest with a broker that is regulated as this can give me the peace of mind that they will operate in an honest and transparent manner because they need to comply with the regulators. I am pleased to see that E*TRADE is very well regulated in the United States by top-tier regulators. This and the fact they are owned by Morgan Stanley, give me the confidence that they are a broker who I can trust.
Securities products and services are offered by E*TRADE Securities LLC who are a member of the Financial Industry Regulatory Authority (FINRA) and Securities Investor Protection Corporation (SIPC) scheme in the United States. The SIPC is an investor protection scheme established in order to protect clients against the loss of cash and securities in case the broker cannot fulfil their financial obligations. The SIPC protection is limited to $500,000 with a $250,000 limit for cash.
Commodity futures products and services are offered by E*TRADE Futures LLC, who are a member of the National Futures Association (NFA) in the United States. The investment advisory services are offered through E*TRADE Capital Management, LLC, who are a Registered Investment Adviser.
The banking products and services are offered by Morgan Stanley Private Bank, who are a federal savings bank, Federal Deposit Insurance Corporation (FDIC) member, or its subsidiaries. E*TRADE Securities LLC, E*TRADE Capital Management, LLC, E*TRADE Futures LLC, and E*TRADE Bank are separate but affiliated companies.
It should be noted that some investment products such as futures are not covered by the investor protection scheme and the protection is not available to all clients. Negative account balance protection is not provided. It is important to carefully read through all of the brokers terms and conditions so that you have a clear understanding of the protection offered before you open an account with any brokerage. Investment products are not FDIC insured and there is no bank guarantee, your investments may lose value.
The broker is primarily geared towards US traders although they can accept clients from a limited number of non-US countries. If you find they cannot accept your country for whatever reason, please feel free to browse our broker ratings for an alternative option.
E*TRADE provide powerful, advanced and flexible trading platforms for investors or traders to access the markets when and how they want, from anywhere in the world where there is an internet connection. The platforms are available at no extra cost for desktop, web and mobile devices. They implement the latest innovative technologies with technical analysis tools, unusual activity scans, options and futures ladders, and much more. You can take on the markets however you want, wherever you want. I found there to be everything you need for trading, research, strategies, and more, for screens of all shapes and sizes.
Power E*TRADE Platform
Power E*TRADE is the brokers proprietary and innovative trading platform that has an abundance of intuitive and user-friendly tools for analysing the markets and trading stocks, options, and futures. If you’re passionate about tracking the markets and trading, this platform is for you. It has a nice modern layout that makes it easy to navigate whilst you can customise it according to your own needs.
Power E*TRADE features include:
- Easy to use and intuitive platform that can be fully customised
- Charting tools that automatically populate charts with technical analysis patterns and education
- Advanced intraday and historical charting with 100+ studies, 30+ drawing tools, and many chart types
- Easily understand the probabilities of an option trade at a glance
- Risk analysis tools that help you translate the options Greeks into plain English
- Multiple chart types, timeframes and order types
E*TRADE Web Platform
You can also access your account and trade via the E*TRADE online web platform. It is easy to navigate and contains many of the tools that traders require for researching potential trades, tracking the markets, placing and managing trades, mastering your skills and more. I like how this platform runs directly in the web browser without needing to download and install any software. I think it is great to be able to manage your account from any device at any time. Despite the ease of access, market analysis capability is perhaps limited when compared to its desktop counterpart. This may not make much of a difference if you are using simple trading strategies but those of you who plan on conducting in depth chart analysis may feel restricted.
E*TRADE web platform features include:
- Accessible within most modern web browsers
- Get free access to real time quotes and charts
- Independent analyst research, quotes, news and charts
- Investing tools and screeners to spot emerging opportunities
- Place, manage and exit positions with relative ease
- Learning resources for beginners
Power E*TRADE Mobile App
The broker offers 2 modern and sleek mobile trading apps for Android and iOS compatible devices. This is useful for those who wish to stay connected to their brokerage account and trade whilst on the go. The Power E*TRADE mobile application is an intuitive and innovative mobile trading platform suitable for all types of traders. The companion to the Power E*TRADE platform, it’s loaded with easy-to-use tools and features to strike when the time is right.
E*TRADE mobile app features include:
- Quickly trade stocks, ETFs, simple and complex options, and futures on a single trade ticket
- Execute options strategies using the customizable options chain, along with custom and four-legged spreads
- Spot potential trades with interactive charts and the most popular technical studies
- View market movement with streaming quotes, news, earnings, dividends, depth view, gains, and more
In addition to the intuitive platforms offered, E*TRADE have tools for every trading level to research investments, track the markets, place trades, and hone your skills. You will find plenty already implemented within the provided platforms that should be more than enough to meet the demands of the average retail trader. These resources include All-Star Lists, online screeners, Thematic Investing, Prebuilt Portfolios and managed portfolios customised according to individual investor needs. You can also get free access to pricing, risk analysis, profit and loss, and other trading calculators and trading strategy tools and simulators available on the platform.
Investing doesn’t need to be confusing so it is great to see that there is a range of useful resources available for clients to learn from objective research, data, and analysis. Traders can access a complete educational library with online training courses, webinars, in depth articles, and news to keep them up to date and informed on the latest market happenings. There is something for all experience levels, covering a range of different investing and trading topics. If you are not sure where to begin, the broker can help you learn the ins and outs of investing with in-depth tutorials, articles, videos, and more. I think there is enough even for the absolute beginner to learn how to trade and invest online.
E*TRADE have something for most investors to trade online through flexible platforms and an all in one trading account, including stocks, bonds, 250 non-proprietary ETFs, over 4,500+ no-load, no-transaction-fee mutual funds, futures, options and certificates of deposit (CDs). There is a full range of investment choices although they do not currently offer forex, CFDs or cryptocurrencies. If you are looking for those assets, you may want to take a look at IG instead.
Investment choices range from the complex to simple and long term to the short term. There are those suitable for newcomers and those more suitable to the more seasoned investor. They charge $0 commission on stock, ETF and options trades, with a $0.65 charge per options contract. If you have more than 30+ trades in each quarter then the options contract charge goes down to $0.5. I found the fees to be very competitive and up there with the best in the industry. You may be able to shop around for a saving here or there, but you need to consider the reputation, platform and tools that you get access to when using a broker such as E*TRADE.
- Stocks, options & ETFs – $0
- Option contracts – $0.65, $0.5 with 30+ trades per quarter
- Mutual funds – prices vary, no load, no-transaction-fee for more than 4,500+ funds
- Futures contracts – $1.50 per contract, per side, plus fees
- Bonds (for online secondary trades) – $1.00 (minimum $10, maximum $250)
The broker has a selection of accounts to cater for different investor and trader needs. There is everything from investment accounts to savings accounts and managed accounts. The E*TRADE brokerage account offers a range of intuitive and user-friendly trading tools along with independent market research and personalised customer support as and when you need it. You can choose from a full range of investment choices. The accounts offered include:
- Brokerage account (individual, joint, custodial) – Standard account for investing and trading with access to the full suite of investments, tools, customer experience and educational resources
- Retirement account (Rollover IRA, Traditional IRA, Roth IRA, SEP IRA) – For those looking to save for their retirement
- Savings account – Various savings accounts with competitive interest rates
- Managed portfolios – Automated investing from $500. This account is for setting up a diversified portfolio that is monitored and managed for an annual advisory fee of 0.30%
- Margin account – Clients can opt for a margin account to borrow up to 50% of eligible equity to buy additional securities. Increased margin can increase risk
The E*TRADE customer support team are on hand to give support and guidance in a prompt and efficient manner to all clients, whatever their investment size or skill level. Customer service is available and happy to answer all kinds of questions via online chat, telephone and email. Using the live chat can quickly connect you to the team and get answers to any questions that you may have. They have over 30+ branches across the United States and welcome people to visit for a one-on-one meeting with an E*TRADE professional financial consultant. I like how if you have questions, you can get jargon-free answers. The team leaves confusing financial jargon at the door, and instead talks to you like a human which is always appreciated.
E*TRADE has a limited choice of methods for depositing and withdrawing funds from your account. This includes Wire Transfer, Check, Electronic Bank Deposit (ACH), and External Securities Transfer. I think it would be considered more convenient for some users if they offered credit/debit card funding and online payment processors. However, I do understand that this may not be possible due to the regulators.
There may be some additional fees charged when using certain deposit or withdrawal methods. The processing time can vary depending on the method used. Bank transfers may take a few business days to clear. E*TRADE strictly does not accept third-party payments. All funds deposited into your trading account must be under the same name as your account.
Accounts can only be opened in USD currency which means that currency conversion fees can apply if you are not funding in this currency. They could improve by adding support for some more currencies but I guess this is not really a deal breaker considering the majority of their clients are based in the USA.
Overall, I think E*TRADE is an excellent broker for anyone who is looking to trade or invest for the mid to long term. They are a very well-established US online broker that has a good range of investment choices for all styles of traders and investors. They also offer managed portfolios for those who prefer a more hands-off approach. The commission fees start from $0 and there is a flexible choice of powerful trading platforms and tools available across multiple devices. In addition to this, they have a large library of educational resources. However, the funding options are limited and there is currently no support for CFD, crypto or forex trading. If you can see past these minor hiccups, then they are certainly worth consideration.