Looks like TradeKing is trying to convert some customers from “one of the larger online brokers”… I wonder who they are talking about? From an e-mail today:
Due to the effect the sub-prime mortgage fallout has had on one of the larger online brokers, some investors have asked us if we’re at risk for similar problems. The answer is a resounding “No.” TradeKing does not invest in any mortgage-related securities, including sub-prime mortgages.
Furthermore, we protect your account against losses up to $25 million as a member of the Securities Investor Protection Corporation (SIPC), and with supplemental coverage from Lloyd’s of London. If you’re concerned about an account you hold with another broker, perhaps you should consider consolidating your assets with TradeKing. We’ll even reimburse any account transfer fees your other broker may slap on you between now and December 31, 2007.
This reimbursement offer may save you $50-$100 if you’ve been wanting to do an ACAT account transfer to them from your existing broker. Scottrade also offers up to $100 in fee reimbursements for inbound transfers [update: if your account value is greater than $25,000]. Read more about both brokers in my TradeKing review and my Scottrade review.
You’ll should also weigh the upfront benefits against the potential commission savings if you go with a broker offering free stock trades.
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I wonder how much one ought to trust Zecco in this regard. If their customer service and site’s efficiency is related to the general health of their buisness, I perhaps should regret having opened an account with them. On many occasions I’ve felt like Zecco is generally inept and, at times, even ‘shady’. Your thoughts?
Also, any clue how IRA deposits are treated regarding SIPC coverage?
Zecco has also stated that they do not invest in mortgage-backed securities. I have a Zecco account too, I’m not worried about SIPC action. They use Penson Financial as their clearing house, which also supports some other very large brokers like MB Trading, so the records should be good.
From what I’ve read, E-Trade is actually pretty unique in this regard, as they were the first to bring a bank (and thus mortgages) and also a brokerage together into one. This allowed them to do some things that other brokerages don’t do. As E-Trade dropped just about every other broker like TD Ameritrade went up.
“SIPC protection does not cover losses from declining investment values. Rather, it protects investors against losses that stem from the financial failure of a brokerage company. If a brokerage fails, SIPC will cover losses up to $500,000 (with a limit of $100,000 for cash losses).
If an investor opens separate accounts under his or her name, the $500,000 SIPC protection does NOT apply to each account. For example, if you open an individual account and an IRA, SIPC will provide $500,000 in coverage for both accounts combined.”
hmm… i need to open a taxable brokerage account. all my retirement stuff is @ fidelity (401k’s) & vanguard (ira’s).
any suggestions on where to open an account? which brokers allow purchases of just one share or a in odd lots? (ie brk-b)
thanks.
It’s hard to make a suggestion, as all brokers have different features. Sometimes it’s not all about price, although of course that is still a huge component. Some people like more ‘hand-holding’ or a physical branch to go to. See the reviews for more info.
I have opened Scottrade, Tradeking, and Zecco accounts. To be honest, the only one I still trade with actively is Zecco, but that is just me. My 401k is with Fidelity and my IRAs are with Vanguard as well.
Just about every single broker allows odd-lot or single share purchases. I’ve done tons of single share purchases at Zecco. Most brokers will not allow partial share purchases – usually only places like ShareBuilder allow that.
You should, not you’ll should.
anyone else thinking about using this to get $$ out of sharebuilder?
Since I had my 401K at Fidelity, I opened a Brokerage account there- just for the Mutual Funds; I don’t think I am an expert at individual stock picking, so I am sticking with Mutual Funds for now; so Fidelities $19.95 charge for Stocks was a not an issue for me.
The following provide some good analysis (but none of them contain Zecco)
http://www.usatoday.com/money/industries/brokerage/2007-01-15-discount-brokers-usat_x.htm
http://www.smartmoney.com/brokers/index.cfm?story=august2007#premium
Right now I think the economy will go down in 2008 as well, so maybe its time to buy some good stocks for the long range. (Buy and Hold), in light of this I am tinking of opening another brokrage with Zecco or Tradeking; and in light of the recent E*Trade issue, I am more and more leaning towards Tradeking. Zecco’s free model is good, but not sure if I want to have my $50K with them, I guess its ok for a couple of K of Fun Money, like Jonathan calls it.
Johanthan what % distribution of money do you have in Scottrade, Tradeking, and Zecco accounts – if you can share that info 🙂 I bet you don’t have more than 10% of your portfolio in Zecco, right?
Using Scottrade as a conduit to get money out of an account that has a transfer fee. It’s free to transfer your scottrade account to another brokerage, so you can take scottrade up on their offer to reimburse moving your account to them, then later transfer the assets from scottrade to the broker of your choice (WellsTrade for 100 free trades a year).
The biggest negative of Scottrade is that they don’t do dividend reinvestment on stocks…
I had a Roth IRA at E*Trade that I wanted to move to Wellstrade, so Scottrade is now my temporary step in between.
Like most people I am equally unhappy with Zecco.
I did not fund my zecco account because Pension messed up linking by ACH to my bank account. Neither zecco nor pension cared to fix the problem.
I am now thinking of opening an account with Wells Fargo which is also commission free/
I mostly trade Options and have found TradeKing to be reliable, efficient and charging the lowest fees. But one is never satisfied and so I ask …. Does anyone else have other brokerages that are as good as or better than TradeKing for Options trading?
Anyone using Firstrade? They claim to offer free dividend reinvestment and allow fractional shares. Trades are $6.95. I’m mostly buy & hold, so $6.95 is a good deal for me if I can get a DRIP going. I’m with TDAmertrade now & considering transferring, just like to know if anyone has any experience with them.
*sorry – I try and and happy to do my own research, unusaully strapped for time*
My wife has some stock from a former employer at E-trade. We don’t actively trade, these just sit there. We both rather dislike E-trade for reasons beyond their certain issues, and we were planning on moving the stock to another holding company.
Both of the above mentioned reviews reveal they have no inactivity fees (the major issue for me at this point). Though I may start some optional IRA activities in the next year, I don’t see anything else in this realm where we will be actively involved. So, for a static bunch of stock, any thoughts on one over the other .. and possibly the thought of moving to Sharebuilder in the future (ING related topic/rumor outside of this).
I guess the other question I would have is related to credit pulls, .. can anyone share experiences regarding a hard or soft pull for either? I’ve got a property finance deal in the works and don’t need to muck that up for a stock transfer.
My experience on hard pulls:
Scottrade: Yes! 🙁
Tradeking: No
Zecco: No
I just discovered that the Scottrade $100 was only for account values of $25,000 or more. That changes things a bit.
I recently had a negative experience with zecco. I had put in a limit order to buy an option and the price of the stock had gone down after hours. My experience with Optionsxpress and Investrade was that they would fill the order at the lower option asking price. Zecco did not do that. It was filled at the asking price from the previous day. I had a stop limit order to sell and the option did not sell. I queried zecco about it and they said the stock option never hit the stop limit. I’m leavin’ zecco soon as I can!
I’ve been doing some research and am leaning towards thinkorswim. They to will cover any ACAT out fees and are more inline with my desires to passively trade mutual funds.
ThinkorSwim has been bought out by Ameritrade so scratch that. No more free ACAT transfer or free mutual fund trades. Zecco did away with their 10 free trades unless you have $25k so scratch them out too. TradeKing is the only broker now that will reimburse your ACAT fees to transfer in your account. They have a $50 transfer out thought unlike Scottrade which is free to transfer out.
Actually, ThinkorSwim still, or is now, providing up to a $100 rebate on ACAT transfer fees charged by your old brokerage (as long as the transfer is $3,500 or more). And if you don’t like them, you can transfer back within 30 days for free.
Oh, and their website currently says 3 mutual fund trades for free each month. After that, its $15/trade.