TradeKing Review - A Broker That Is Definitely One Of the Best

TradeKing wasn’t the first of the discount brokerage firms online, but it is one of the cheapest. The former directors of SureTrade began TradeKing in late 2005 with the home office located in Boca Raton, Fl. While TradeKing offers deeply discounted trading costs, no TradeKing review would be complete without mentioning the innovations, customer service and educational information offered to rookie investors. The present location of TradeKing's primary office is Fort Lauderdale, Florida with a secondary office in Charlotte, NC.

TradeKing was the first brokerage site to have a blog and use social media to increase the user’s satisfaction. In fact, this TradeKing review isn’t the first to praise the online brokerage service since giants such as the Wall Street Journal, SmartMoney, Barrons, Consumers Reports and StockBrokers.com all rate it highly when it comes to cost, service and ease of use.

TradeKing also offers, the Options Playbook, released the book in 2007. The book is a guide created for newer players to the option game, but also good for the pros. It offers information on trading options, which is in easy to understand terms and industry jargon-free in most cases. This is just one example of the reason TradeKing is perfect for the new investor as well as the seasoned one.

Cost of Services

No TradeKing review would be complete without mentioning deeply discounted prices the site offers. The cost for a stock trade is only $4.95. Option trades run $4.95 per trade plus $0.65 for each contract, unless you trade more than 8, then the cost is $8.95 plus $0.15 per contract. If you trade multi-leg contracts, you only pay for one leg. One of the most impressive facts noted by this TradeKing review is the fact that there’s no additional cost for a broker-assisted trade.

Mutual funds are low cost also. Loaded funds cost nothing to purchase since the site makes the money from the fund’s load. However, no load funds are $9.95 both in and out of the fund. If you’re in the habit of transferring money between funds in one family, you might consider buying direct from the fund whether you have an account at TradeKing or other brokerage house. While there’s no information on whether TradeKing considers this a purchase and sale, buying direct avoids all fees. Bonds are only $4.95 per transaction with a low minimum of $14.95. Treasury purchases cost $24.95 as do brokerage CDs, which are very different from traditional CDs because they fluctuate in price until they mature.

IRAs have no annual fee but if you transfer them out or close them, there’s a $50 cost. There’s an inactivity fee if your account is below $2,500 and you don’t make any trades in over 12 months.

There are also other traditional fees such as check stop payment, ACAT fees (transfer out fees), wire transfers and overnight delivery. The ACAT fee is $50 and compared to some more expensive brokerage houses that don’t charge an ACAT fee, obviously higher. Just like any business, returned checks or automatic withdrawals from checking accounts cost you also. The cost of depositing a stock certificate at TradeKing is quite salty even for a rejected certificate.

TOD accounts—transfer on death—cost $50 to set up. Some full service brokerages do this free. If you’re buying index products, there’s an additional cost on certain indexes of $0.35 per contract and also a charge of $0.01 per share on penny stocks—those under $1-- in addition to the $4.95. However, it can’t exceed 5% of the cost of the trade. Since Pink Sheet and OTCBB trades require a minimum trade of $100, the additional cost at minimum is $5.

Because of it offers many services that other discount brokerage houses don’t offer; there are a myriad of other fees associated with these services. However, most of these are special situations the average investor doesn’t use. If you use the money market account with check writing, be aware there are high fees associated with this capability.

Products and Services

TradeKing offers most products available through full service brokerage houses: stocks, ETFs, bonds, options and mutual funds. They also offer money market accounts with check writing capability. Cash sitting in the account for future trades receives no interest and the money market accounts have a fee. You might find it better to transfer funds into the account right before trading.

Any TradeKing review you read will praise the educational services and stock trading tools available at the site and this one is no different. You’ll find a myriad of tools available at TradeKing.

Platform

The platform at TradeKing is easy to use and rated highly by reviewers and users alike. Even the novice will find making trades is easy, even if finding the right stock isn’t.

Positives

• The cost per trade at TradeKing is phenomenally low and one of the best in the business
• This site offers many helpful tools for the novice trader and even the established pro.
• TradeKing gives the users a chance to exchange ideas and tips, which is great for the novice trader.
• TradeKing is closer to a full service site and even has the same price for broker-assisted trades.

Negatives

• The cash balance receives no interest.
• The money market account with check writing privileges has high fees associated with it.
• There’s an inactivity fee for smaller investors.
• There’s a cost to transfer funds.

Conclusion

TradeKing doesn’t offer all financial products and charges for some services such as making an account a TOD, a simple process free at some brokerage houses. However, the positives of low cost trading, a super informational system and a user-friendly site far outweigh the negatives making TradeKing one of the best online brokerage houses.