SogoTrade Review - If Cost Is What You Care About Most

SogoTrade is a deeply discounted online brokerage firm. SogoTrade was an offshoot of another company, as many of the online brokerage houses are. It began in 1999, when William Yeh developed Genesis Trading, LLC. Once Genesis received approval from the SEC, Yeh began to build the platforms and technology necessary to open for business in 2000 with LASER, its platform. Even though the market declined, the company grew rapidly.

The brokerage house and Yeh received accolades for the accomplishments and rapid growth. In 3006, Genesis launched SogoInvest as its deeply discounted brokerage site. It received a name change to SogoTrade in 2008. Even though Yeh received many awards and honors and both Genesis and SogoInvest rank high on the number of daily trades there are numerous some on trade execution time and customer service at SogoTrade.

The site looks a bit amateurish and even though the advertising is for SogoTrade, the large blocks at the bottom of the page screams Google ad banners. Of course, looks aren’t everything, unless of course, the quality of service and transactions are equally cheesy.

Cost of Services

The most attract feature of the site, as most SogoTrade reviews will note, is the low cost of trading stocks, $3 per trade. However, as some users note, that comes at the price of quality software and trade execution. One user described the site as a “submit and pray” site when making a trade. ETF trades are also $3 and options are $5.00 plus $0.50 per contract. If you purchase penny stocks, those price under $1.00, the cost increases to $3.00 plus ½ percent of the principal value, a rather high rate considering this is a discount brokerage.

There are frequent specials also that lower the cost of trading such as receiving 100 free trades for opening an account or 25 free ones for referring a friend. They also reimburse up to $100 for the cost of ACATing your account from another brokerage. There’s no inactivity fee for your account and no cost to open an account. However, there is a $30 annual IRA fee and a $50 closing fee. There are also traditional fees charged for services such as overnight delivery and bad check fees, which are normal for any business.

No SogoTrade review would be complete without noting the interest rate on margin accounts. They offer a very low rate interest on margin accounts. If you aren’t fussy about transaction time or customer service, it’s a great place to have a margin account due to the very low interest rate and low trading price. On the other side of the fence, you receive no interest on cash balances within the account.

SogoTrade also has a low fee for exchanging mutual funds. While some funds are no-load-no-transaction fee, others have a $15 charge for both in and out. This is far lower than the $49.99 charge of some brokers. Loaded funds are no cost trades since the site receives part of the load from the company as commission. However, there is also a $15 charge to sell them. If you’re like many people that trade funds within the same family to balance your portfolio, stick with purchasing them directly from the company or a local sales representative and trade them free, once you pay the load.

Products and Services

There are no frills at SogoTrade. The site allows you to trade in stocks, options, ETFs and mutual funds. In addition, it offers a money market account with check writing and debit card services to access your account’s funds. It also offers IRAs and Education Savings accounts. They also have bonds and brokerage certificate of deposits, which differ greatly from those from banks. The brokerage CDs act like bonds, which rise and fall in value with the interest environment but still redeem for face value at maturity.

Platform

Probably next to customer service, the biggest negative noted in this SogoTrade review is the platform. Opening an account is slower than most brokerage houses, making a trade is also. The software is antiquated with few additional benefits for the user. In this case, you get what you pay for when you use SogoTrade.

Positives

• Low trading costs are the primary reason to use SogoTrade.
• The availability of fractional shares is another feature not offered through many brokerage houses.
• No inactivity fee or annual fee for non-IRA accounts also are pluses for SogoTrade.

Negatives

• The customer service is poor.
• The trade execution time is slow and inadequate for active traders.
• The tools are okay for the newest trader, but lack sophistication to be helpful beyond that point.
• The site has frequent technical difficulties.
• SogoTrade doesn’t offer a full complement of products.

Conclusion

Amazingly, even though the trades are dirt cheap, you find many traders avoiding this site. The reason is that it costs too much in missed opportunities and frustration. If you’re making only a few trades and don’t worry about speed of trades or the helpful software for informational purposes, it’s not a bad site due to the low cost. However, for those that want one site as their financial rock, this one isn’t it.