E*TRADE is one of the oldest and best-known online stock brokers in the U.S. It offers a wide variety of investing tools, resources, and features that place it among the leading full-service and discount brokerage firms.
Now that E*TRADE has eliminated commissions on U.S.-listed stock, option, and ETF trades, it’s an especially solid choice for both active traders and long-term investors.
In this E*TRADE review, let’s take a look at the brokerage’s features to help you decide if it’s the right service for you.
E*TRADE Review
Summary
When it comes to Commissions & Fees, E*TRADE shines. There are no commissions on U.S. exchange-listed stocks, options, and ETFs. Options contracts cost only 65 cents, but if you make more than 30 options trade per quarter, that price is reduced to 50 cents. However, unlike Ally Invest, E*TRADE charges a fee of 0.30% to use its robo advisor service, Core Portfolios. With E*TRADE, you have plenty of Account Options, although 529s are missing from the list. As for Investment Options, nearly everything is on offer (E*TRADE is teasing crypto trades soon, too). You’ll also find a huge assortment of fee-free mutual funds. E*TRADE offers a wealth of Tools & Resources to make studying stocks and other securities a breeze. We give E*TRADE high marks for its Website/App/Ease of Use due to its comprehensive web and app platforms. However, novice investors might be a bit overwhelmed. We also love E*TRADE’s 24/7 phone and live chat Customer Service, as well as the ability to reach a professional in a local branch office.
E*TRADE Features
| E*TRADE | Features |
|---|---|
| Commissions & Fees | $0 |
| Options Trades | $0 + $0.65 |
| Mutual Fund Trades | $19.99 |
| Types of Investments | Stocks, Penny Stocks, Options, ETFs, Mutual Funds, Bonds, FOREX, Futures |
| Types of Accounts | Taxable, Joint, Custodial, Trusts, Limited Partnerships, Partnerships, Non-Profit, Retirement Accounts (Roth IRA, Traditional IRA, Rollover IRA, SEP IRA, SIMPLE IRA, Solo 401(k)), College (Coverdell) |
| Managed Portfolio Option | Core Portfolios |
| Banking Services | Checking, Savings, CDs |
| Account Minimums | $0 |
| App Availability | iOS, Android, Mobile Optimized Website |
| Customer Service | Phone: 24/7; Live Chat: 24/7; Email; Branch Office |
| Margin Availability | Available |
| FINRA CRD# | CRD#: 29106 |
| SEC Registration Number | SEC#: 8-44112 |
| Current Promotions | E*TRADE Sign Up Bonus – Up to $2,500 Cash |
Open a Brokerage Account with E*TRADE
Additional Features
- E*TRADE Core Portfolios. If you’d rather “set it and forget it” with a robo advisor than DIYing your investments, this service will do the heavy lifting for you. (See more details, below.)
- E*TRADE Web. This trading platform offers stock data, analysis, screeners, real-time quotes, and live commentary. E*TRADE Web gives users the same features and tools you’ll find with much more complicated – and expensive – trading platforms for free and with no minimums required.
- Power E*TRADE. This platform is based on the old OptionsHouse service (E*TRADE purchased the platform in 2016). It’s ideal for more advanced, technical traders, especially those with an interest in futures and options. Futures and options traders can also use the free Power E*TRADE app to access most of the features on the go.
- Nearly 4,500 No-Fee Mutual Funds. E*TRADE offers users a huge selection of free mutual funds. Those not on the extensive list cost $19.99 per transaction.
- E*TRADE Bank. Want a one-stop-shop for your money needs? E*TRADE Bank offers high-yield savings and no-fee checking accounts.
- Morningstar Education. Thanks to its partnership with research firm Morningstar, E*TRADE offers a selection of courses for new investors.
What Is E*TRADE?
E*TRADE is a full-service brokerage offering investment options for any investor. The company has been around since 1991, when it offered trading services on America Online and Compuserve (remember them?).
Since then, E*TRADE has grown to have roughly 5 million brokerage accounts and nearly $350 billion in assets under management. That makes E*TRADE not only one of the oldest online brokerage services, but also one of the largest.
In October 2019, E*TRADE joined several online discount brokers to eliminate commissions on U.S.-listed stock, option, and ETF trades. In addition, there’s no minimum required to open or maintain a brokerage account.
You can use three trading platforms for free, including a robust platform designed for technical traders that E*TRADE acquired through its 2016 purchase of OptionsHouse. However, the entry-level platform, E*TRADE Web, is simple enough for novice traders to understand.
E*TRADE also features a bank with a high-yield savings account and a no-fee basic checking account. There’s also a second checking account that pays interest. This account does charge a fee, but if you maintain a balance average above $5,000, E*TRADE will waive it.
These banking features are great for those who like to keep all their financials under one roof, or at least minimize the number of websites and logins they need to conduct their financial affairs.
How to Get Started with E*TRADE
Opening a new E*TRADE account is easy and should take only a few minutes.
As with all brokers and other financial institutions, new account holders must supply standard personal information such as their name, address, Social Security number, employment information, financial information, etc.
Funding Your E*TRADE Account. You can fund your new account by transferring money from another financial account electronically, by writing a check, by initiating a wire transfer, or by moving an existing account over from another firm. You can also roll over an old 401(k).
Transferring Money. The free E*TRADE Transfer Money service lets you move money between E*TRADE accounts and from outside financial institutions. Your funds are 100% protected by the company’s Complete Protection Guarantee. Note the Transfer Money can take up to three business days before a transaction is completed.
How Does E*TRADE Work?
As we mentioned above, E*TRADE offers three fee-free platforms for trading stocks, options, and other investment vehicles from your desktop or mobile device.
E*TRADE Web is the most basic platform. Using this service, you’ll have access to free real-time stock quotes, streaming market data, analysis and commentary, stock screeners, and lots more. You can use the platform to make trades, track your investments, and create watch lists for securities you’re exploring.
E*TRADE Mobile offers the power of desktop trading with the convenience of a smart-device app. You can use it to analyze, follow, and trade investments (including compicated options plays) on either your Apple or Android phone, Apple Watch, or tablet.
Power E*TRADE is based on the old OptionsHouse platform. It’s a powerful trading platform especially for options and futures traders, although advanced stock traders will find it useful too. You can use the service to create charts, examine trade probabilities, and analyze data with a selection of robust tools. Power E*TRADE is also available as a mobile app.
Investment Options
E*TRADE offers a variety of investment options that should meet most individual investor’s needs. These include:
- stocks
- bonds
- mutual funds
- futures
- options
- exchange-traded funds (ETFs)
- CDs
- FOREX (foreign currencies)
You can open various investing accounts, including standard taxable accounts and fee-free, tax-advantaged IRAs.
E*TRADE Core Portfolios
Picking and executing your own trades can practically be a part-time job itself. If you’d rather not DIY, E*TRADE now offers its Core Portfolios service. Essentially, this product is a robo-advisor, which will use computer algorithms to create and maintain a portfolio ideal for your risk tolerance and goals.
With Core Portfolios, E*TRADE will invest your portfolio in stock and bond ETFs. However, you can direct the service to select socially responsible funds if you like. These represent companies that have chosen ethical approaches such as renewable energy, fair treatment of workers, etc.
Each Core Portfolios account will also include a cash allocation of roughly 1%.
To open a Core Portfolios account, you must deposit at least $500. Although E*TRADE’s brokerage services are free, Core Portfolios carries a fee of 0.30% annually. This is slightly higher than the 0.25% charged by top robo advisors Betterment and Wealthfront.
It’s also worth pointing out that rival brokerage Ally Invest charges no fees and requires a minimum of only $100 for its robo advisor product, the Cash Enhanced Managed Portfolio. However, as this product’s name implies, it maintains a large cash buffer of 30%, for better or worse.
You can find a complete review of Core Portfolios here.
Pricing
E*TRADE has always been considered a discount online broker. However, in October 2019, the company and a list of other top online brokerages announced it was eliminating commissions for U.S. exchanged-based stock, option, and ETF trades.
You’ll still pay 65 cents per contract if you’re an options trader. However, if you make more than 30 trades per quarter, that amount will be reduced to 50 cents.
E*TRADE offers nearly 4,500 fee-free mutual funds. However, if you want to trade a fund not on that list, the per-trade fee is $19.99.
As we stated in the section above, the Core Portfolios robo advisor service costs 0.30% annually.
There’s no minimum required for opening a brokerage account. However, note that Core Portfolios accounts require $500 to participate.
E*TRADE iPhone, Apple Watch, Tablet, and Android Apps
E*TRADE offers two apps you can use on your mobile device. The basic E*TRADE Mobile app provides most of what you can find with its E*TRADE Web platform. There’s also the Power E*TRADE app, which was built specifically with options and futures traders in mind.
E*TRADE Pros & Cons
Pros
- Commission-Free Trading. You can now enjoy zero commissons when you invest in U.S.-based stocks, options, and ETFs.
- Core Portfolios. If you’d rather use a robo advisor than DIY, E*TRADE offers its Core Portfolios product.
- 24/7 Customer Service. You can always get a hold of a living, breathing customer service rep using E*TRADE’s phone or live chat options.
- Three Robust Platforms. Use either E*TRADE Web, E*TRADE Mobile, or Power E*TRADE to research and complete your trades.
- Checking and Savings Accounts. You can make E*TRADE your one-stop shop for money needs by opening a checking or savings account with E*TRADE Bank.
- Online Investing Courses. If you’re a complete beginner, you can take any of the company’s free courses to learn about investing and trading.
Cons
- Can Be Overwhelming for New Investors. If you’re totally new to investing, you might be overwhelmed when you first fire up E*TRADE’s website or mobile app. You also need to be somewhat computer-savvy. If you’d prefer more hand-holding, there are simpler robo advisor/broker hybrids, such as M1 Finance, that can walk you through it.
- Core Portfolios Fee. Although E*TRADE’s brokerage service is free to use, its Core Portfolios robo advisor costs 0.30% annually (on the high side of the robo advisor fees) and requires a minimum of $500. If you’re interested in using a robo advisor, rather than trading individual securities, there are cheaper services available.
Current E*TRADE Promotions – Up to $2,500 Cash Bonus
Like many brokerage firms, E*TRADE offers a cash bonus.
New E*TRADE customers who open a new, non-retirement brokerage account and fund it within 60 days of account opening may be eligible to receive the following bonuses:
- Deposit: $5,000 – $24,999 – ($100 cash bonus)
- Deposit: $25,000 – $99,999 – ($200 cash bonus)
- Deposit: $100,000 – $249,999 – ($300 cash bonus)
- Deposit: $250,000 – $499,999 – ($600 cash bonus)
- Deposit: $500,000 – $999,999 – ($1,200 cash bonus)
- Deposit: $1,00,000 or more – ($2,500 cash bonus)
Securities or funds (minus any trading losses) must remain in the account for a minimum of 12 months or the bonus may be surrendered.
Offer expires: 1/06/2020
Get up to $2,500 at E*TRADE Today
E*TRADE Review – Conclusion
E*TRADE is a full-service brokerage offering investment options for any investor. Overall, E*TRADE is a great choice for anyone who wants to trade stocks, ETFs, options, or mutual funds.
Who is E*TRADE best for? E*TRADE really shines when it comes to active trading. Its mobile and web platforms offer faster trading through the use of point-and-click order entry and advanced trading tools. Plus, E*TRADE makes increasing portfolio management control and customization seamless.
On top of everything, E*TRADE charges zero commissions on U.S.-based stocks, ETFs, and options trades, making this one of the best brokerage options around.
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Aaron @IncomeHoncho says
I have an account with Etrade and never really had any problems with them. Service was good, Fees are okay but still a bit up there for me. I would prefer it to be a bit cheaper which would make them a great contender.
Carlos says
Any thoughts about their debit card?
Ryan Guina says
Carlos, if you are already using E*TRADE for banking, then the debit card is a nice feature. Personally, I like to separate my banking / spending accounts from my investing accounts. This barrier makes it more difficult to transfer money from investments to my spending accounts. But as long as you don’t have any issues with that, then the E*TRADE debit card is a nice feature.
Kurt @ Money Counselor says
I’ve been using E*TRADE for years and like it a lot. Unfortunately I’m being forced to move all of my and my wife’s accounts elsewhere. We moved to Canada in 2009. Though we’re US citizens, E*TRADE is now telling me that it’s not licensed to handle our accounts unless we have a US address. Apparently the company’s unwilling to spend the money on Canadian licensing. So I’m searching for a new firm to handle our accounts that’s not so stingy and set to work with US citizens residing in Canada. Any suggestions would be welcome.
Ryan Guina says
Kurt, this sounds like something that would be handled on a case by case basis by each brokerage. I do know that USAA handles investment accounts for many people who live overseas, so they might be worth looking into. USAA has a full service bank (checking, savings, etc.), as well as an excellent brokerage service (trades are $5.95, or $8.95). USAA also has their own mutual funds and they offer financial planning services. You can learn more at their site: USAA Brokerage Services.
GBR Briana says
Thanks for this info Ryan. I recently posted on the Personal Dividends forum about stepping into the investment world and had no idea where to start. About a year ago I went to the E*TRADE site and was immediately confused and intimidated. I’m going to give it another whirl.
Ryan says
Briana, E*TRADE is a great option for almost anyone. However, you may find something that is a better match for your specific investment needs. Check out this list of Best Brokerages for a Roth IRA. This article details some of the differences between the mutual fund houses and discount brokerages and the pros and cons of using them for different investing styles. E*TRADE is included in the list because I believe they are one of the top brokerage firms out there. Best of luck!