TradeKing Review

TradeKing is an online broker that specializes in both stocks and options trading. The company is one of the newer brokers that I have come across. The company is a Florida based broker and has been in existence since 2005. TradeKing is a discount broker along the lines of Scottrade, E*Trade, and other discount brokers.

TradeKing Review

TradeKing has built up quite a reputation over the past 6 years. Barron’s has given the company a four star rating from 2007 to 2011. Smart Money voted TradeKing the best discount broker for 2008 and for 2010. I have found that a lot of traders like using Trade King because of its low cost trading platform.

TradeKing Advantages

Lowest Trading Fees

TradeKing has incredibly low fees for trading. The $4.95 flat stock trading fee is the lowest that I have found online. The $4.95 pricing even applies to broker assisted trades which can be quite pricey at other brokers. Most brokers that I am familiar with charge $19.95 and up for broker help with trades.

Options trading has a base price of $4.95 and a 65 cent cost per contract for up to 8 contracts. The price is $8.95 and 15 cents per contract when trading more than 8 options contract. That is the lowest options pricing that I know of.  50 options contracts would only cost $16.45.

No Inactivity Fees

TradeKing does not have any inactivity fees which is another plus because that makes trading more affordable for the regular stock buyer. Traders and investors are not forced to make transactions just to avoid fees.

No Minimum Balance Requirement

TradeKing does not just have a low minimum balance requirement. There is absolutely no minimum balance requirement. You can open a regular trading account with any dollar amount.

Education Center

The Education Center is one of the things that sets TradeKing apart. They have a whole section devoted to Rookie Stock Investors and teaching the basics of stock investing. There are sections on Rookie Options Trading and ETF Investing. Additional information is available for free to Trading Veterans and All Star Investors.

Stocks & Options Tools

TradeKing has a number of tools for the stock and options traders. MarketGrader Research Reports are available for fundamental stock investors and there are technical analysis tools available for technical traders. The options tools are one area where TradeKing shines. The Options Scanner and Options Calculator make it easy to do your due diligence on options contracts and can help you assess the volatility of a proposed options trade. The Options Chain makes trading options really simple.

Trader Network

One of the things that makes TradeKing unique is the large trader network. The forums make it easy to connect with likeminded traders. You can interact with other traders and learn a bunch of different strategies that you may not have known about. You can actually watch trades live while they are being placed. If you find a winning stock or options trader, you can copy their trading strategy.

Customer Service

TradeKing might just have the best customer service in the industry. I have tested it out just to see how long it takes to get an answer. Emails are responded to very rapidly and you can get a customer service representative on the phone really quickly. TradeKing was voted number 1 in customer service by Smart Money just last year.

TradeKing Weaknesses

Fund Fees

While the fees for stock and options trading is dirt cheap, the fees for mutual fund and C/D investing are not. Mutual funds cost $14.95 per purchase. There are a few brokers that offer free mutual fund investing or charge $9.95. Investing in a certificate of deposit triggers a $24.95 fee which is quite high.

Investment Options

TradeKing is a little light on investment options in my opinion. An investor looking for mutual funds and bonds can get a more robust selection at other brokers. TradeKing offers 8,000 mutual funds which is about half of the number that other discount brokers offer.

Penny Stock Investing

Penny stock investing can be costly at TradeKing since there is an additional 1 cent charge for each share on an entire order of stocks priced less than $1. This surcharge makes penny stock investing inefficient.

TradeKing’s Grade: B+

TradeKing is a solid broker for beginning investors, options investors and stock traders. The low fees are a plus because you get to hold onto more of your money. The educational center is full of information that teaches the basics about stocks and options investing. The learning resources can benefit any investor. Most discount brokers will not take the time to walk you through the investing process and TradeKing will. This makes TradeKing an attractive option.

You can sign up for TradeKing for free right now just to check it out. Be sure to get a free copy of the Options Playbook. It is a great book on options investing and is being given away free just for joining TradeKing.

Sign Up For TradeKing Today!

Comments

  1. avatar optionsdude says:

    Those are some good prices for stock and options trading. I will have to consider them in the future. Unfortunately, it is easy to just stick with a current broker because you get used to the navigation and ordering screens. It sounds like they want to specialize in stocks and options and discourage other investing based upon their pricing scheme.

  2. How do you feel that Tradeking compares to Sogotrade? I use Sogotrade since it has 3 dollar per trade commissions (so slightly cheaper). However, Sogotrade does require a 500 dollar acct. minimum.

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