TradeKing Review

In the past, the competition among brokers has centered around low commissions. But over the last year, there’s been a shift not only towards lower commissions and more advanced tools, but also social networking. Brokers have been working towards building tight-knit communities of traders around their platforms and TradeKing has been leading the way.

In this TradeKing review, I’ll share some of the pros and cons of opening an account with TradeKing, and hopefully help you decide if they suit your trading needs. We’ll also have a look at what they offer in terms of tools, education, research, and finally, we’ll assess how they compare to some of the other top-tier discount brokers out there.

Pros - Ultra-low commissions (stocks & options), mobile trading apps (iPhone & Blackberry), high quality education, active trader network, great customer service.

Cons - No access to international exchanges, no banking services, no Android app and no virtual trading.

Best For - People looking for a very well-rounded broker. TradeKing is an excellent mix of great tools and low prices. Options traders will especially appreciate their advanced options tools and new options pricing scheme for high volume traders (see fees and commissions below). Their “trader network” and education center can push you to the next level as a trader.

Minimum To Open Account -  No minimum ().

Special Offer:

Fees & Commissions

Equities: $4.95
Options: $4.95 + $0.65 per contract – OR – $8.95 + $0.15 per contract*.
Mutual Funds: $14.95
Broker Assisted: $4.95
Futures: N/A
Platform Fees: $50 (only applicable if your account is “highly inactive”)**
Margin Rates: 8.75%-4.0%

*The new “volume discount” in TradeKing’s options pricing schedule means you can save a lot if you’re a high volume options trader. For example, where a 25 contract trade used to cost $21.20 under the old pricing scheme, it’s now just $12.70. 100 option contracts costs just $23.95 under the new pricing (just to give you an idea of how cheap this is, 100 option contracts at Scottrade, Fidelity, Schwab, E*Trade, TD Ameritrade and optionsXpress will all cost you well over $80).

**Your account will be considered “highly inactive” if you 1) fail to make a trade within 12 months PLUS 2) you have a total household account value of under $2,500. This shouldn’t affect most people, but it’s something to be aware of in any case.

Other notables about TradeKing commissions: For multi-leg contracts, only one base commission is charged. For stocks under $1.00, add $0.01 per share.

Investments Offered

Equities: YES
Options: YES
Mutual Funds: YES
FOREX: NO
Futures: NO
International Exchanges: NO

One of the drawbacks of TradeKing is the lack of access to foreign exchanges (although I should mention that you can trade foreign ADRs) and the lack of ability to trade futures or FOREX (if that’s your thing). Nevertheless, many people use TradeKing as their broker for U.S. traded investments to take advantage of the low commissions, while holding an account with another broker for international trades.

Research & Tools

Free Live Streaming Quotes: YES
Breaking News: YES
Market Commentary: YES
Research Reports: YES
Market Analysis: YES
Trader Community: YES
Trader Forum: YES
Tax Lot Selection: YES

One of the things that sets TradeKing apart from most other brokers is their active trader network and forum. The network offers lots of useful perks, like access to daily hot stock and option trades, rationale breakdowns of specific trading strategies, updates from prominent industry experts, and the ability to peek into other successful traders portfolios to see their performance. If you’re keen to learn, you can really take a lot away from TradeKing.

A few other notable tools (all of them are free when you open an account):

Maxit Tax Manager will save you (or your accountant) a lot of time when tax season rolls around. It also calculates the tax consequences of trades in real-time, provides pre-trade analysis of short and long term gain/loss opportunites, and creates on demand tax reports (ex. 1099s) with the click of a button.

The Technical Analysis suite (provided through Recognia) gives you access to advanced technical features like price forecasting, chart pattern recognition, and the ability to set up automatic email alerts for when favorable patterns form on your securities of interest.

Strategy Screeners allow you to screen stocks, mutual funds and ETFs based on more than 60 qualifying criteria, including advanced criteria like bullish or bearish technical patterns.

Advanced Options & Options Strategy Scanners give you screening capability based on 25 different filters (based on the underlying stock, an option contract, or both), and the ability to form and execute sophisticated options strategies like collars, condors, and calendar spreads.

Education

Free Tutorials: YES
Free Live Webinars: YES
Free Live Workshops: YES
Options Trading: YES
Futures Trading: NO
Stock Trading: YES
Bond Trading: YES
Mutual Fund/ETFs: YES

The education resources at TradeKing are exceptional to put things simply. You can learn based on your experience level (rookie, veteran, or advanced), and take advantage of their exhaustive resources like live on-demand videos, webinars, options playbook, and market outlook courses.

Customer Service

24/7 Support: NO
Live Chat: YES
Email: YES
Phone: YES (8am-6pm EST, M-F)
Branch Offices: NO

TradeKing has a strong focus on customer service. Even though they don’t offer 24/7 support, they guarantee a response to all emails within 2 hours during regular business hours, and 24 hours on weekends. You can also speak to a TradeKing rep live during business hours through LiveChat.

Commentary In The News

Best For Options Traders – Barron’s 2011
#1 For Customer Service – SmartMoney 2011
4+ Stars & Best Browser Based Online Broker – Barrons (2007-2011)

Special Promotions - Get your $150 value TradeKing promotional code.

Final Thoughts…

If you’re looking for a well-rounded brokerage, TradeKing offers great bang for your buck. Whether you’re after the low commissions or looking to geek out on advanced tools and mobile trading apps, I think you’ll be happy. Great for high volume options traders, and their education and customer service reputation cements their status as a very solid broker choice this year.

Have you used TradeKing? If you have and you’d like to share your experience, feel free to share your thoughts and add to the discussion in the comments section below!