To cut to the chase, E-Trade provides excellent trading tools for online options traders. This discount online options broker can save experienced options traders volumes of valuable time with their straightforward options order placement tools that make even placing complex spread and straddle orders surprisingly noncomplex.
E-Trade is a full service broker. They provide stock trading, options orders, futures, ETFs, bond investment opportunities and a choice of over 1,000 no-load mutual funds. They also provide full banking services and retirement accounts. You can buy and sell from any device, including Android mobile phones and iPads.
E-Trade provides two fee structures based on trade activity. Stock and options contracts are $7.99 if you make at least 150 trades per quarter or $9.99 if you trade less than 149 per quarter. Options contracts are $7.99 or $9.99 plus $0.75 per contract. Broker-assisted orders are $45 (plus associated fees), and they charge $19 for options exercises or assignments.
Though they offer a lower rate for active traders, they are higher priced than some of our higher ranked discount brokers. For example, for 100 contracts the trade fee plus the $.075 per contract comes to a total of over $80 whereas other services are just over $20 for 100 contracts. Complex option orders are $7.99 plus $7.99 (or $9.99 for low volume traders) plus $0.75 per contract.
Their margin rates are comparative to other brokers, ranging from 0.25% below base to 4.30% above base. If you have a low loan balance of less than $24,999, the margin rate is 8.44%. If you have a high balance of over $1 million the margin rate is 3.89%. As with all brokers, if you cannot cover a loan or order, they reserve the right to sell your stock assets to meet the agreement.
Like other banks and brokers there are additional fees to consider such as $2 per paper statement, $60 for full transfers, $10 per check request, $25 for outgoing wire transfers and $75 for stock certificates. They also offer full bank services, which can make cash transfers faster and easier for you. They offer interest-earning checking accounts and do not charge monthly account service fees to active traders.
E-Trade provides some of the best option-specific order tools we have seen. Though most services provide easy-to-use basic order placement tools, E-Trade's tools actually make complex order placement easy. With their option trade tool, you can easily place basic, spread, buy-write, butterfly or condor type orders, including iron-condor or iron-butterfly orders. You can also easily monitor your options positions, orders and alerts. For added convenience, we also noticed that information such as option charts appeared more quickly with this service than others. You can also place trade, bond or mutual fund orders through your E-Trade account.
E-Trade also provides portfolio and risk analyzers. The portfolio analyzer tool will check for portfolio diversification by sector, style, stock type and world region. The risk analyzer will evaluate your risk and rewards, chart your performance against market indexes, run what-if scenarios and perform stress tests of worst-case scenarios.
In terms of options research, you can create your own strategy profile. You can develop a strategy profile by target price, investment amount, time frame, volatility and market outlook such as bullish, bearish, neutral or volatile. E-Trade also provides an options analyzer, a probability calculator and an options screener.
This discount options broker provides trading apps for popular mobile devices. With their mobile platforms, you can buy, sell and place stock and options orders. With E-Trade's mobile tools, you can also view real-time quotes, news and charts. They offer apps specifically for iPhone, iPad, Blackberry and Android mobile devices. To make it even easier to install the mobile apps, they will send an SMS message to your mobile phone that includes a direct download link.
If you need to contact E-Trade regarding your account, you can contact them by email, mail or telephone. They provide telephone support 24/7. They do provide chat support; however, chat support representatives cannot access or discuss your account. They can only answer general queries. If you need account-specific support, you have to contact them by telephone.
Unlike many online discount brokers, E-Trade has offices across the U.S. where you can speak to knowledgeable employees in person. You can visit one of over 25 branches located in California, Florida, New York, Texas and more. Indirect support includes FAQs, tours and demos, webinars and live seminars. They also provide an extensive list of forms and applications online for things such as name changes, IRA applications, direct deposit authorization and bank account applications.
In terms of options trading, E-Trade makes placing complex orders amazingly simple. This discount broker also provides easy-to-configure option research tools and fast, real-time reporting. However, to take advantage of the $7.99 trade fee you need to be an active trader and make at least 150 trades per quarter. If you are a dabbler or a low volume trader, you may want to check out a service that provides the same flat rate regardless of trade volume.
