Some of you know that I’ve been a long time customer and fan of Etrade Financial. In fact, I also own their stock (ETFC) due to my believe that they offer a superior product versus its competitors. While the stock for sure hasn’t made me any money, I continue to be impressed by its brokerage services. This Etrade review highlights why.
Etrade Brokerage Account and its Seamless Integration with its Banking Unit
I’ve written before that I almost use Etrade’s online savings account as though its a cash sweep account. The reason why I do this is because transferring money between my taxable investment account and my online bank is instant. This gives me maximum flexibility as well as a fat yield while I’m not using the funds.
Etrade Brokerage’s Fast Execution
I never recommend executing market orders, but E*Trade is so confident with their execution rates that they have a 2 second guarantee on market orders for S&P 500 stocks and ETFs. What happens if the execution doesn’t happen within 2 seconds? They let you trade the stock or ETF for free.
The advanced routing also helps with limit orders, because it means that your orders have a higher chance of executing at the prices you specify.
Also note that if you use their Power Etrade Pro Platform, you can route your orders through any specific ECN or exchanges you prefer as an option.
Etrade’s DRIP Treatment vs TD Ameritrade
I also have access to TD Ameritrade’s brokerage account (through my wife) and the way TD Ameritrade handles DRIPs drives me to Etrade even more. With ETrade, DRIPs are distributed to you the day they are supposed to and reinvested that same day. With TD Ameritrade, there was at least once where they didn’t give me the dividend until two weeks later and thus reinvested two weeks late. That’s absolutely wrong in my opinion, and another reason why I rather deal with Etrade.
Etrade’s User Interface and Website Availability
In the many years that I’ve been their customer and logging on pretty much everyday, I have never seen an outage. Actually, I would think this is a basic requirement for an online brokerage but I’ve heard horror stories of other brokerages (read TD Ameritrade) going offline during market panic and a time when you absolutely need access to your account.
On the user interface front, I’ve gotten so used to using it that I will be bias. What I can say though is that it easily displays all your accounts (IRAs, bank, taxable etc) all in one convenient screen while not confusing you which account you are on.
The other thing I love about Etrade is actually the fact that they let you do almost everything online. For example, they have a pretty comprehensive online service center that has many of your questions answered. They also let you enable and disable DRIPs for any of your stock positions within their online system while many other brokerages require you to call in.
Power Etrade Pro
If you are a high frequency trader and want maximum control, then Etrade’s Power Etrade Pro is for you. Basically, it is a trading platform (which is written in Java so it works in any operating system like Windows, Mac and Linux etc) that gives full screens of trading tools including:
- Nasdaq TotalView (over 20x more liquidity than Live Level 2 Quotes)
- Streaming Option Chains
- Real Time Account Positions
- Speed Keys for Quick Navigation and Trading
While I’ve played around with it (mainly because I thought it was cool), I can honestly say that the website already does what I need it to do. For professional traders though, the platform is definitely worth looking into.
Global Trading with Etrade
Etrade is also one of the few brokerages that provide trading in foreign exchanges. With an Etrade account, you can trade stocks in Canada, France, Germany, Hong Kong, Japan and the UK. If you don’t want to sleep, they even offer free real time quotes!
Etrade is Right for You
Like I keep telling everyone, I love Etrade and think it’s a solid contender as your brokerage of choice. Smart Money agrees with me too because they rated Etrade Financial as the #1 discount stock broker in 2008 after its review of the user interface, customer service, trading technology and other categories.
Bonus: They are also offering a bonus right now that gives you 100 free trades!