Online brokerage services have existed for over 20 years. Trading investments today has never been cheaper. So while the race towards cheap trades (in some cases free) is happening, other functionality is becoming more important when selecting a stock broker.
For this review, I compare E*TRADE and Vanguard. Which one is better depends on your needs? So let's examine the major features first.
We've determined with online brokerages the most critical feature customers care about is the
cost per trade. The second most important feature is the minimum deposit, and the last is if the broker
offers mutual funds. Let's look at how E*TRADE and Vanguard
stack up against each other on these points.
To start, we will consider the minimum investment required for both applications. In other words, how much does one need to invest to use the service? Out of the two, E*TRADE minimum investment of $500 is smaller than the deposit of required by Vanguard.
Next I'll consider cost per trade for both brokers.
Out of the two, E*TRADE is cheaper per trade at $6.95 than Vanguard at $7.00/trade.
Both E*TRADE and Vanguard offer mutual funds. So this feature isn't a clear difference between the stock brokers.
|Review||E*TRADE Review||Vanguard Review|
Overall rating as by Investor Junkie.Rating
|Commissions & Fees|
|Ease of Use|
|Tools & Resources|
|Amount of Deals|
|Promotions||Trade FREE for 60 Days and get up to $2,500||None|
|Stock Trades||$6.95/trade ($4.95/trade for 30+ trades/quarter)||$7/trade for first 25 trades; additional trades: $20/trade|
|Options Trades||$6.95/trade + $0.75/contract ($4.95 + $0.50/contract for 30+ trades/quarter)||$7/trade + $1/ contract|
|Investment Types||Stocks, Penny Stocks, ETFs, Mutual Funds, Bonds, FOREX, Futures||Stocks, Penny Stocks, ETFs, Mutual Funds, Bonds, FOREX|
|Access||Website, iOS App, Apple Watch, Android App||Website, iOS App, Android App|
|Broker Assisted Trade|
|No Fee ETFs|
|Sign Up||Sign Up|
E*TRADE, the grandaddy of online discount brokers, is still a good choice for active investors. Its platforms are easy to use, customer service is responsive, and trades execute quickly. However, there are now many less expensive rivals on the market.
Use Vanguard to get a wide selection of low-cost, no-load mutual funds, ETFs, stock broker services, and financial planning. For investors wanting a one-stop shop for all their banking and financial needs, you'll have to look elsewhere.