TradeKing is an online discount brokerage firm that was started in 2005. The reasons why I choose TradeKing were simple. As much as I like and use Fidelity for most of my trades, I felt it was a great way to get experience with another discount stock broker. I also wanted to find a broker best suited for the type of trading I would be performing within my ‘WTF Fund’.
The signup process FOR TradeKing was easy, but, unfortunately, funding can take up to seven days. I do wish their funding process was easier. Once funded though, the rest of their service was great. The review has been updated for 2012. I’ve been a TradeKing customer for over two years, and this is an update to my original review. Overall, I still enjoy using their service, and my opinion of their service remains the same.
TradeKing’s Commissions and Fees
| Stock Trades | Options Base | Options Contract | Minimum Deposit | Mutual Funds |
|---|---|---|---|---|
| $4.95 | $4.95 | $0.65 | $0.00 | $9.95 |
TradeKing has an annual charge of $50 if you do not meet these two requirements:
- The combined account value of the household account(s) is less than $2,500
- AND No commission-charged trades have been executed in the account(s) during the last 12 months
Meaning if you have less than $2,500 with TradeKing you better make at least one trade a year. This shouldn’t be an issue for most investors. Though, if you have less than $2,500 to invest, my suggestion is you shouldn’t start investing anyways.
Security
Their login process via a web browser (not by a mobile device, mind you), is somewhat security conscious, but also somewhat of a pain. You must use a mouse and click on a screen keyboard to enter your password.
I understand the purpose of this security process (it prevents hackers from gathering your password from what you type), but it’s not fool proof. There are reports of viruses that grab your entire screen session, and unlike Treasury Direct where the keyboard is random, the virtual keyboard is the standard ‘qwerty’ format. At minimum they need to grab your mouse x and y coordinates. For the utmost in security you should do your financial transactions in a dedicated virtual machine.
So while they are slightly more secure than some of the other discount brokers, the best type of security would be RSA based key fob like E*Trade offers.
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Customer Service
SmartMoney rated TradeKing #1 in customer service in 2010-2012 and gave them a 5 out of 5 rating. For those who want to talk online, they offer an online chat option from 8 AM – 6 PM Monday through Friday, Eastern time. Every time I’ve contacted TradeKing’s customer service, they were quick to respond and able to resolve my issue quickly. Compared to other discount brokers, TradeKing has been one of the most helpful customer service experiences. If you are looking for helpful assistance, TradeKing is definitely the broker for you.
Trading Tools
TradeKing has a wide range of tools available to long term investors and active traders. It has:
- Options Pricing Calculator
- Probability Calculator
- Profit + Loss Calculator
- Options and Strategy Scanners
- Stock, ETF + Mutual Fund Screeners
- Maxit Tax Manager
- Technical Analysis
- TradeKing LIVE
TradeKing recently introduced TradeKing LIVE which is their new streaming (web 2.0) platform. You can stay on top of the latest market changes and your investments. It is completely browser-based, so there is no software to download and install. TradeKing LIVE currently only supports Apple’s Safari, Google Chrome, Firefox 4+ web browsers. They, unfortunately, do not support Internet Explorer, which is odd since it’s still the most popular browser. Though since Chrome and Firefox is available on the Windows platform, this should be an easy workaround.
TradeKing recently announced an API. This in my opinion is the future of online brokers. Interfacing with third -party research tools, trading systems, and other ways to automate trading is the future growth of this industry. It will be interesting to see how it pans out.
Unlike others, TradeKing does not offer research reports, or access to Morningstar analysis. Though the rates are so cheap you can easily afford a membership to Morningstar Premium Membership.
Options Trading
TradeKing is an options trader’s dream, and one of their primary advantages. From 2008-2012 Barron’s has rated TradeKing best for options traders. TradeKing has some of the lowest options pricing available, and the savings compared to other brokers can be significant. TradeKing supports from the basic to the advanced options strategy. Such as:
- Basic (Put/Call)
- Covered Call
- Protective Put
- Spread
- Straddle
- Strangle
- Combo
- Butterfly
- Condor
- Collar
- Double Diagonal
- 4 Legs Free Form
Education
TradeKing’s education center is very comprehensive. It covers all of the investments they offer: stocks, options, bonds, mutual funds and ETFs. They have an especially great options section called “The Options Playbook”. It’s not uncommon they have 3 to 4 live webinars every month on various investments subjects. This is a much different experience I’ve had with some of the other brokers. In a way it’s smart of them to do this, so you are using their trading platform more often. They also have a great YouTube channel educating customers about various options strategies.
Social Network Investing – Trader Network
Another aspect that makes them unique is their social network named “Trader Network”. This is what makes them different than other discount brokers. TradeKing has over 200,000 members in their network. It’s where investors can connect with one another, share experiences, ideas and strategies; see what others are trading and how they are performing. You can see what other investments are popular, and what other insights other investors can offer. For those interested, you can see my trades on TradeKing’s network.
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Mobile Trading
TradeKing has two smartphone apps: Blackberry and iPhone. I previously discussed the iPhone app, and unfortunately no longer own a Blackberry to do an adequate review. In my opinion, this is their weak area and needs improvement. I suspect with the Zecco merger, which has great mobile apps, this will change in the near future.
If you don’t have any of these mobile devices, they do offer a simpler mobile edition of their web site. The mobile features are somewhat limited, but you have enough features to do basic trading.
TradeKing Summary
It was recently announced that TradeKing and Zecco are merging. In the coming months, it will be interesting to see how they intergrate the assets of each company. In my opinion, they should take the best of both companies. TradeKing offers great customer service and online education. Zecco, on the other hand, has a great online community, FOREX, and mobile trading apps. I look forward to when the merger is complete.
TradeKing has great pricing, great customer service, helpful online training, and adequate mobile integration. For a trader who needs low cost, and no hidden fees – TradeKing is hard to beat.
I was happy with Tradeking but switched because they don’t offer Direct Connect into my financial software; you have to log into the website or use their mobile apps which is a huge pain. It’s just so much easier to work within Moneydance, iBank or Moneywell (I’m a Mac user) and click the download button and have ALL of your accounts automatically updated. It just got so cumbersome to do this, THEN have to log in separately to Tradeking for my investment info.
Hi Shawn,
Thanks for your comment. I agree that is one thing I am not crazy about with TradeKing. Unless you do a lot of trades, importing them via their export function isn’t the end of the world either. I’ve been able to download it into my Quicken without issue. I suspect eventually TradeKing will offer this feature.
Not at all happy with Tradeking. I will not be staying with them. Their website/platform is too chunky and does not offer many convienences as TDAmeritrade. The one customer service guy I have spoken with is too condescending and argumentative for me to stay with them. I’ll be pulling out the next time TDAmeritrade offers me a good deal.
Tradeking is a wretched firm to do business with. I had my account there for 2.5 years and the experience was miserable. Their clearing firm, Apex, AKA Play-Skool Fisher Price is completely incompetent at record keeping making for a long frustrating adventure when 1099s are due at tax time. I received a 1099 from trade king 3 years in a row, each time it was late and incorrect when finally delivered. The wait for corrected copies was even longer. Their found reps also have an unfortunate difficulty with telling the truth often promising things and then reneging. The best investment I made while at TradeKing was the $50.00 I paid to transfer my account out.
Earl, you are aware this isn’t just a TradeKing/APEX (at least this year)? Many tax forms are late this year because of the various last minute changes in the tax laws. In fact, I’ve already gotten a few amended tax forms for my investments with various vendors.