E-Trade Review 2024

Stock Trade Fee:N/A

Account Minimum:$0

Promotion:N/A

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Trading involves substantial risk of loss

Eric Rosenberg

Last updated: Jul 28, 2020

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Etrade is the oldest online brokerage in the United States with a history going back to 1982. It offers competitive fees, but not the lowest in the industry unless you trade at least 30 times per quarter. It is excellent for beginners and offers powerful tools and research that make it suitable for new and advanced traders alike.

Etrade is a full-service discount brokerage. It is notable for being the first-ever online brokerage. The company history goes back to 1982 and began offering online trading under its current name in 1991. The company had 4.9 million active accounts at the end of 2018 and averaged well over a quarter of a million daily trades. It offers competitive pricing and powerful web and desktop trading platforms. It may be a good fit for the needs of many online traders. Read more to find out if it makes sense for your needs.

Pros:	Cons:
Oldest online trading company in the United States Multiple platforms geared towards traders of different experience levels Active traders qualify for lower cost trades	Some brokerages offer lower trade costs Minimum balance fees for bank accounts $500 account minimum

E-Trade Overall Rating

4.1

Here's how we rate brokers

Cost & Fees

3.5

Banking

4.0

Account Types

3.5

Customer Support

4.0

Tradable Securities

4.5

Promotions

2.5

Account Opening

4.5

Regulations, Reputation & Security

5.0

Trading Platforms

4.5

Research & Education

4.0

Order Types

4.5

Trading Specs
General Information
Trading Features

Official Site:us.etrade.comDemo Account:Open Demo AccountAccount Minimum:N/AStock Trade Fee:$0Promotion:N/AETF Trade Fee:$0Mutual Fund Trade Fee:$19.99Options Base Fee:$0Options Per Contract Fee:$0.65Bonds Trade Fee:$1Futures Trade Fee:$2.25Forex Trade Fee:N/A
Phone Trades:N/ABroker Assisted Trades Fee:$25Annual Account Fee:$0Account Transfer Fee:$75Account Closing Fee:$75Account Inactivity Fee:$0IRA Annual Fee:$0IRA Closure Fee:$60Tradable Securities:Stocks, Options, ETFs, Mutual Funds, Bonds, FuturesCommissions Free ETFs:250Commission Free Mutual Funds:4400
Number of Mutual Funds (Total):9000Complex Options Max Legs:4Account Types:Taxable, Joint, Custodial, Retirement Accounts, Traditional IRA, Roth IRA, Rollover IRA, SEP IRA, Solo 401k, Simple IRA, Coverdell, Trusts, Business Accounts, Partnerships, Non ProfitOS compatibility :Windows, MacWeb Platform:YesMobile Trading:N/AOrder Types:Market, Limit, Stop, Trailing Stop, Contingent, Multi Contingent, OCO, OTO, OTOCO, Algo

Introduction

Etrade has nearly four decades of experience helping traders manage their stock and investment accounts online. It is the oldest online brokerage in the United States and offers multiple platforms catering to varying trader backgrounds.

Etrade was founded in 1982 as TradePlus. It became Etrade in 1991 and offered online securities trades for users of America Online and Compuserve. These days, internet speeds are a lot faster and Etrade has worked to offer top platforms for traders from a variety of backgrounds.

Over the years, it has made several acquisitions including Harrisdirect, BrownCo, and OptionsHouse. It offers proprietary web-based, desktop, and mobile trading platforms to help you manage your account wherever you go. There are some cheaper brokerages when it comes to commissions, but costs are very competitive among large US brokerages.

Cost & Fees3.5

Etrade is in-line the typical discount brokerage trading fee. It isn’t the cheapest, but it is pretty close. The standard trade fee is $6.95.

Most trades at Etrade cost a standard $6.95. If you trade at least 30 times per quarter, this goes down to $4.95. Options are $6.95 + 0.75 cents per contract. With 30 trades or more per quarter, that drops to $4.95 plus 0.50 cents per trade. The $4.95 rate, if you qualify, gives you a rate equal to the lowest cost per trade among major discount brokerage firms.

Futures contracts cost $1.50 to trade and bonds are $1.00 per trade on the secondary market. Treasuries trade for no fee. Mutual funds outside of the no-load, no-transaction-fee (NTF) funds cost $19.99 per trade. If you buy-to-close short options priced at 0.10 cents or less, there is no redemption fee. Other option exercises cost $4.95.

Account Types3.5

Etrade offers traditional brokerage accounts as well as retirement, custodial, and bank accounts.

Etrade does not have the longest list of supported account types in the industry, but it has the most popular consumer accounts covered. Those include traditional brokerage accounts, custodial and college savings accounts, traditional and small business retirement accounts, managed portfolios that work similar to robo-advisors, and its own bank with checking and savings accounts.

According to the Etrade website, the most popular accounts are traditional brokerage accounts, core portfolios (robo-advisor), custodial accounts, and IRAs. Other accounts include Coverdell ESA accounts for college savings, several types of IRAs, four managed portfolio accounts, and self-employed retirement accounts.

Trusts and businesses can open an Etrade account. Accounts are not available for anyone outside of the United States.

Etrade Bank has three accounts. It offers a standard checking and savings account. Its Max-Rate Checking account offers interest (currently 0.05%), but the account charges a $15 monthly fee if you have less than a $5,000 average monthly balance. The savings account offers a competitive 2.10% APY. It charges a $10 fee if you don’t maintain an average $1,000 monthly balance. All minimum balance fees are waived with a combined $50,000+ minimum balance across all Etrade accounts or with 30+ trades per calendar quarter in linked accounts.

New brokerage accounts must be funded with $500 within 60 days or the account will be closed. New savings accounts require a $1 minimum deposit and checking requires a minimum $100 opening deposit.

Managed portfolios have varying fees depending on the portfolio you choose. Broker-assisted trades require an additional $25 fee. Some other fees apply for less common activity.

Tradable Securities4.5

Etrade supports popular investment types including stocks, bonds, ETFs, mutual funds, options, and futures.

Both passive investors and active traders will be happy with Etrade’s support of a wide range of investments. Etrade supports stocks, bonds, ETFs, and mutual funds from all major exchanges including penny stocks.

For those looking for more advanced trading strategies, options and futures are supported. Futures at Etrade give you access to markets including equities indices, energy, interest rates, metals, agriculture and livestock, foreign currencies, and Bitcoin. Within forex, you can trade nine different currencies.

Account holders have access to more than 250 commission-free ETFs including popular funds from Vanguard, iShares, Invesco, PIMCO, Oppenheimer, John Hancock, and other fund families. Of 9,000+ mutual funds, over 4,400 have no transaction fee. In total, that means account holders have access to well over 4,500 funds with no commissions or trading fees.

Account Opening4.5

Opening an Etrade account online is the fastest and easiest way to get started. You can also open an account by phone, by mail, or at one of Etrade’s retail locations.

Accounts are available to US residents and are very easy to open online. After all, Etrade was the first online brokreage, so they have the online account application process very well polished. You can also open an account by calling Etrade or downloading, printing, and mailing in a paper application.

When opening a new brokerage account, you will be required to fund your account with at least $500 within 60 days. You can also transfer in your account from another brokerage. You can fund a new account with an electronic transfer, check, or wire transfer.

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Demo Account

Trading Platforms4.5

As the oldest online brokerage in the United States, Etrade offers excellent online trading platforms. Choose between a web platform, a desktop platform, and two mobile apps to manage your account.

Etrade offers two versions of its web trading platform, both of which have a corresponding mobile application. The online Etrade web platform is the current iteration of the oldest online web trading platform. This platform supports stocks, options, ETFs, mutual funds, and bonds. It includes investment insight tools to help you generate new trading ideas and execute orders in just a few clicks.

The web platform includes real-time quotes, news, charts, and daily updated market commentary. Integrated screeners and help zero in on securities that meet your criteria. It also includes back testers and tools to optimize and analyze your portfolio.

The shining star, however, is Power Etrade. This powerful platform offers tools for advanced and experienced traders looking for more to support an active trading strategy. This platform features interactive and customizable charts, a technical pattern recognition tool, several analysis tools, and integrated Bloomberg TV and news.

Both the Etrade web platform and Power Etrade have their own corresponding mobile apps for iOS and Android. Even the Power Etrade mobile app supports complex trading strategies with customizable options chains and four-legged spreads.

Order Types4.5

Etrade supports most popular types of trades including market, stop, limit, and conditional orders. Etrade offers a rare two-second execution guarantee for all ETFs and all S&P 500 stocks.

Typical order types such as market orders, limit orders, and stop orders are available at Etrade. You also have access to some complex conditional orders. At Etrade, those include:

Bracketed
Contingent
One-Cancels-All
One-Triggers-All
One-Triggers-OCO

Day trading is allowed. If you are a pattern day trader, which means you make four or more day trades within a five business day period, you are required to hold a $25,000 minimum account balance.

Margin trading is available at Etrade. You can borrow up to 50% of your eligible equity. Some experienced and high-net-worth traders have access to increased buying power with lower margin requirements. If you have an account with at least $100,000 in assets and are approved for Level 4 options by Etrade, you may qualify for these expanded margin allowances.

Banking4.0

Etrade offers two checking account options and a savings account. It’s basic checking and savings account are both fee-free with competitive rates and features.

Etrade offers two checking accounts and a savings account for your banking needs. The basic E*TRADE Checking requires a $100 minimum opening balance, pays no interest, but also has no recurring fees or minimums. It’s a great standard checking account and better than you get with most nationwide banks.

The Max-Rate Checking account works like the E*TRADE Checking account with two main differences. First, you earn 0.05% APY. Second, you have to keep a $5,000 minimum balance, get $200 or more in direct deposits in the account, or meet some other hurdles to avoid a $15 monthly annual fee. The minimums and fees coupled with a low-interest rate make this account unexciting.

The Premium Savings Account is just below the top savings account rates you’ll find online. If you already have your investments with Etrade, this is a good saving account to store your cash with FDIC coverage and instant transfers between accounts

Customer Support4.0

Customer support is friendly and helpful. It is available by phone, online chat, email, or at an Etrade branch.

Etrade offers support online, by phone, or in-person at one of 30+ branches located in most of the largest metropolitan areas.

I tested out the chat support a few times, and each time the representative was very helpful, friendly, and responsive. However, in my tests, support took longer than the quoted time. One time I got right through, but the others were well over five minutes. If you are dealing with an urgent account issue, the wait time may not meet your needs. The support was good, but this type of wait for support chat is not ideal with an online investment company.

Online reviews of Etrade support from a variety of sites show average ratings of around three to four out of five stars.

Promotions2.5

Etrade offers a new account promotion for accounts with at least $10,000 in new deposits.

Depending on how much you bring to a new Etrade account, you can qualify for up to $2,500 cash plus 500 free stock or options trades in the first 60 days after opening your new account.

All accounts with at least $10,000 in new deposits qualify for the 500 free trades promotion. The bonus cash you get starts at $25,000 in deposits. See the chart below, from the Etrade website, to find out how much cash you can get based on the size of your account.

Regulations, Reputation & Security5.0

Etrade has a good reputation and is regulated by several US government and trade groups. It offers strong levels of insurance coverage and has won several awards, including those ranking it as a top platform for beginner investors.

Etrade is regulated by the Securities and Exchange Commission and is a member of FINRA and the NFA. Brokerage accounts are insured by the SIPC and Etrade Bank is insured by the FDIC. In addition to government insurance programs, Etrade has $600 million in additional brokerage protection worth up to $900,000 per customer from London Insurers.

Etrade maintains a strong reputation and has a relatively clean track record outside of one class-action lawsuit related to its mortgage and home equity loan portfolios in 2007. It is listed by the Human Rights Campaign Foundation as a best place to work for LGBTQ equality and scored 100% on the organization’s corporate equality index.

It has won several awards including recognition from Investopedia, Barron’s, StockBrokers.com, Kiplinger’s NerdWallet, and others. It ranks particularly well as an investment and trading platform for beginners.

Etrade is a publicly traded company on the NASDAQ exchange under ticker symbol ETFC.

Research & Education4.0

Etrade has a good reputation as an excellent brokerage for beginner traders. Its knowledge section covers basic to advanced topics.

Experienced traders can jump in with many helpful tools. Research includes access to reports from reputable sources. Etrade publishes its own market news and analysis and provides access to Bloomberg within its advanced trading app. You can also access screeners and advanced charting tools.

Education resources are available for beginner to advanced topics and include articles, videos, and live webinars. Major sections of the education area at Etrade, which are free to access even without an account, include investing basics, advanced trading, retirement planning, taxes, and live webinar events.

Unfortunately, there is no free demo account to test out Etrade’s platforms without an account. It offers videos, however, that show how the platforms work.

Trading experience

Etrade supports the needs of beginner to advanced traders. Professional-level traders may find Etrade platforms limiting, but most advanced traders should have their needs met.

Etrade has won awards and recognition for its ease of use and resources for new investors and traders to get started. It is clearly a standout choice for people who want to learn more about trading and get their feet wet in the markets.

Advanced traders should find most needs met by the Power Etrade platform and companion mobile app. Power Etrade includes over 100 types of studies, more than 30 drawing tools, and various chart types. Historical charting and risk analysis help you solidify any trading plan.

There are some competing brokerages with more powerful trading platforms for expert and professional traders. However, as the oldest industry veteran, Etrade does a good job at covering the needs of most traders regardless of background.

FAQ

Is Etrade regulated?

Yes. Etrade is regulated by the SEC, SIPC, FINRA, NFA, and FDIC.

Where is Etrade based?

New York City

When was Etrade founded?

1982

How does Etrade make money?

Primarily trade commissions, margin interest, managed portfolio fees.

How do I deposit in Etrade account?

Electronic funds transfer, wire, or check

How do I withdraw money from Etrade?

Electronic funds transfer, wire, or check

How do I open an account with Etrade?

Online, phone, mail, or in-person

Does Etrade offer margin accounts?

Yes

Are funds at Etrade secured or insured?

Yes

Overall4.1

Etrade is a popular brokerage with a long history of serving diverse customer needs. The biggest downside is the fees, which can be lower elsewhere.

Etrade is suitable for beginner to advanced traders and offers some very helpful tools for people newer to the markets. The biggest downside is trading commissions, which are lower elsewhere unless you trade at least 30 times per quarter. For passive and long-term investors, that makes Etrade a bit more expensive.

If you are a very active trader or trade an average of at least ten times per month, however, pricing comes down and is in-line with the lowest in the industry. With those prices and the enhanced Power Etrade platform, you should be in great shape to execute any trading strategy at Etrade.

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