Etrade: Control Of Your Financial Future

August 8, 2020
Brokers
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Etrade is a United States broker that is registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC). Etrade offers you a wide variety of financial instruments such as stocks, ETFs, funds, bonds, options and futures through its investment platforms. Additionally, you will find a $0 USD commission per traded stocks, which makes Etrade a good alternative for investing in the stock market.

It is true that Etrade is a broker that has good characteristics in several aspects, but, we strongly believe that Capital.com is the best online trading platform because is one of the easiest and cheapest ways to trade CFDs on equities, commodities, indices, Forex pairs and cryptocurrencies anywhere in the world. Capital.com offers you zero fees on intra-day trading, a lightning-fast web platform and their proprietary Negative Balance Protection. Also, Capital.com gives you the best chance at financial success with a clean, easy-to-use interface.

We analyzed hundreds of data points relevant to the costs, benefits and features of trading with E-trade and scored our findings on a 10-point scale across 10 distinct categories.
Fees 9
Signup Process 5
Minimum Deposit 10
Ease of Use 9
Deposit & Withdrawal Options 9
Customer Support 10
Asset Classes 3
Referral Program 2
Demo Account & Educational Resources 2
Safety & Regulation 10
Total 69

What is Etrade?

Etrade is a financial services company that provides online brokerage, investment advisory services, and related products and services primarily to retail investors. The company was founded in 1982 and conducted its first online trade in 1983.

The company is a leading online financial services firm that specializes in a first-class experience for the digitally inclined investor and trader, backed by personal professional guidance. Additionally, Etrade is registered with the SEC as an investment adviser. It is important that you note that this is a broker only for traders in the United States.

Etrade Pros & Cons

Pros

  • The investment platform is easy to use and very intuitive.
  • Free stocks and ETF trading.
  • 24/7 customer support.

Cons

  • It is only possible to buy instruments from the US market.
  • Forex trading is not possible.
  • The verification process is slow.

Etrade Account Types

Etrade offers you several types of accounts for both active and passive investors. In this sense, you will be able to choose from accounts in which you can build your own portfolio to retirement accounts or portfolios managed by Etrade experts. Next, you will see the accounts that this broker offers you:

Brokerage Account

It is an investing and trading account with which you can buy and sell stocks, ETFs, mutual funds, options, bonds, and more. This account allows you two modalities, individual or joint (owned by two or more people).

Retirement Account

This type of account allows you to invest the capital that you are going to allocate for retirement through different individual retirement accounts (IRA):

  • Rollover IRA: Consolidate assets from a former employer’s retirement plan.
  • Traditional IRA: Earnings potentially grow tax-deferred until you withdraw them in retirement.
  • Roth IRA: Pay no taxes or penalties on qualified distributions if you meet the income limits to qualify for this account.
  • Sep IRA: Flexible annual contributions from 0% to 25% of earned income for the self-employed and small businesses.

Managed Portfolios

  • Blend Portfolios: Work with a financial consultant to get a tailored portfolio of mutual funds and ETFs that’s managed for you.
  • Dedicated Portfolios: Let a professional build and manage a diversified portfolio of stocks, mutual funds, and ETFs around your individual goals and preferences.
  • Fixed Income Portfolios: Work with a dedicated financial consultant on building a custom bond portfolio managed by third-party portfolio managers.
Here’s a breakdown of our 10 scoring categories, each scored out of 10 for a total of 100 points.

#1 Etrade Fees

Etrade has a fee structure that depends on the type of instrument with which you decide to trade:

  • There are no commissions for trading stocks or ETFs.
  • The commission for options contracts is $0.65 USD.
  • The commission for futures contracts is $1.50 USD.
  • There are also fees when you negotiate with bonds in the amount of $1 USD per bond.
  • In the case of indices, the trading fees will depend on the type of index as you will see in the following table:
IndexFee per contract
SPC$0.51 USD
RUT$0.18 USD
VIX$0.32 USD
OEX$0.40 USD
XEO$0.40 USD
DJX$0.18 USD

In addition, the broker does not charge fees for inactivity, account maintenance, deposit or withdrawal. This type of characteristic means that Etrade loses only one point in our score despite the fact that there are fees to trade with some financial instruments.

E-trade Fees Score: 9/10

#2 Signup Process

The account opening process at Etrade is entirely online but the verification process is unusually slow. In fact, it could take you up to three days to be able to trade on the broker’s investment platform.

Steps To Open An Account

  1. Account Selection

    Take into account that the broker offers several options and in this phase of the account opening process you should select the one that best suits your investment plans.

  2. Personal information

    Add personal information such as phone number, residential address and names.

  3. Identity Verification

    Add a colour copy of your personal documents. For example social security number, residency, and employment status.

  4. Investment Profile

    Give your investment profile and margin trading preferences.

  5. Review Application

    Review your application and create your ID.

  6. Funding

    Set up funding preferences.

Although the process of opening the account will allow you to have a high level of configuration and customization of the account, the broker loses points in the way because you will have to wait 3 days to pass the identity verification step.

E-trade Signup Process Score: 5/10

#3 Minimum Initial Deposit

Etrade does not set a minimum initial deposit for most of its accounts, in particular for the Brokerage Account. For this reason, the broker is very well qualified in this category.

But, you must take into account that in the case of portfolio accounts there are minimal restrictions for each of the alternatives offered by this broker:

  • Blend Portfolios: Professionally managed portfolios with $25,000 USD minimum.
  • Dedicated Portfolios: Custom-built, professionally managed portfolios with $150,000 USD minimum.
  • Fixed Income Portfolios: A custom portfolio of investment-grade bonds with $250,000 USD minimum.

Even though these seem high, you should not take these minimum amounts as something out of the ordinary because it is usual for managed portfolios to handle large amounts of capital, as investments tend to be low risk. However, the fact that you can start trading with the Brokerage Account with the amount you choose lets this broker obtain a high score in this category.

E-trade Minimum Initial Deposit Score: 10/10

#4 Ease of Use

Etrade offers you several platforms so you can choose the one that best suits your needs and tastes. Next, you will see each of them:

Power E*TRADE

Power E*TRADE is an innovative desktop platform packed with intuitive, easy-to-use tools for stocks, options, and futures trading. If you’re passionate about tracking the markets and trading, this platform is for you. In addition, the platform stands out in the following characteristics:

  • Charting tools that automatically populate charts with technical analysis patterns.
  • Easily understand the probabilities of an options trade at a glance.
  • Advanced intraday and historical charting with 100+ studies, 30+ drawing tools, and many chart types.
Power E*TRADE is a innovative platform

Power E*TRADE App

The Power E*TRADE mobile app is an intuitive and innovative mobile platform built for traders of all kinds. The app it’s loaded with easy-to-use tools and features to strike when the time is right. This app is very well rated in the Apple App Store with 4.5/5 but in the Google Play App Store, it only has a score of 3.6/5.

Power E*TRADE app

E*TRADE

This investment platform is the original place to invest online (the platform web version). E*TRADE offers all the tools that any trader or investor needs to research investments, track the markets, trade and hone their skills. Some of the highlights this platform offers are:

  • Independent analyst research, quotes, news and charts.
  • Investing tools and screeners to spot emerging opportunities.
  • Retirement planning and learning resources.
Etrade: investment platfor

E*TRADE App

The easy-to-use E*TRADE app lets you stay connected to your brokerage accounts and the markets on the go. This app is highly rated in the Apple App Store with 4.6/5, but in the Google Play App Store, it only has a score of 3.6/5.

Etrade app

We think that both the desktop and web versions are excellent investment platforms that offer very good analysis tools. But, the broker loses just one point due to some bad comments in the Google Play version of the app. In this sense, users comment that the app sometimes closes and that sometimes it does not allow to make orders. However, take into account that the app is very well rated on Apple’s download page.

E-trade Ease of Use Score: 9/10

#5 Etrade Deposit & Withdrawal Options

Etrade does not charge a fee every time you make deposits into your account, however, there are fees associated with withdrawing money from your account when you choose the wire transfer options ($25 USD). Also, Etrade will allow you to use various deposit and withdrawal alternatives.

  • Deposit a check.
  • Wire transfer: A wire transfer is an electronic transfer of money between accounts, including accounts at different financial institutions.
  • Transfer an account: Transferring an account simply means moving all of your assets (cash and securities) from an outside financial institution to Etrade.

Unfortunately, the broker does not offer the ability to add or withdraw funds with debit or credit cards. This, together with the fact that you must incur costs every time you make a withdrawal via wire transfer, cause the broker to lose one point in this category.

If you are looking for a broker that offers you the opportunity to save money in this specific aspect, we recommend Capital.com. Also, you should read our articles “Plus500” and “XM“, there you will see that these brokers offer excellent alternatives for deposits & withdrawals.

E-trade Deposit & Withdrawal Options Score: 9/10

#6 Etrade Customer Support

At Etrade, you’ll find excellent customer service. You will have access to an immediate 24/7 service through the following channels:

  • Live Chat
  • Email: [email protected]
  • Phone:
    • 800-387-2331
    • Outside the U.S. call +1 678 624 6210

Additionally you can follow the broker in the following social networks:

The customer support offered by Etrade is very good with several alternatives and immediate support 24/7. For this reason, the broker is well qualified in this category.

E-trade Customer Support Score: 10/10

#7 Asset Classes

Stocks

Etrade offers you the opportunity to trade stocks on the US Market. For example:

  • IBM
  • Apple
  • Chevron Corporation
  • Verizon Communications

Gold

Yes, you can trade gold at Etrade.

Bonds

Etrade’s offer of bonds is quite wide. You can access more than 50,000 different types of bonds, both government and corporate bonds.

ETFs

Etrade offers a wide variety with 2,000+ ETFs. For example:

  • ARK
  • EMQQ
  • KWEB
  • CHIQ
  • IPOS

While it is true that Etrade offers a wide range of financial instruments, unfortunately, it does not specialize in the Forex market, and it is not possible to buy currency pairs on the investment platform. Furthermore, the broker does not offer CFDs or cryptocurrencies either.

Moreover, the broker only offers US shares. This is a factor that limits diversification at the international level.

One of the most important aspects when investing is having the ability to build a diversified portfolio and because you will not be able to include cryptocurrencies, Forex or CFDs in your investment portfolio, the broker loses many points in this category.

E-trade Asset Classes Score: 3/10

#8 Referral Program

Etrade offers a very unique referral program where you will receive a $50 USD Amazon gift card as a reward when your guests open and fund a new brokerage account with a minimum of $500 USD.

While it is true that it is possible to get extra money with the Etrader referral program, the truth is that the bonus could be higher. In addition, it is a limitation that you receive the bonus in an Amazon gift card because you will not be able to reinvest them on the platform.

Take into account that the only way to exploit your profits is to increase your capital by reinvesting them. For these reasons, the broker is not well rated in this category.

E-trade Referral Program Score: 2/10

#9 Demo Account & Educational Resources At Etrade

Demo Account:

Etrade does not offer demo accounts to test the operation of its two platforms. These types of tools turn out to be very useful to test the investment platform and learn how to use it. It also allows you to learn to trade (in the case of beginners) and develop investment strategies without the risks associated with real money accounts.

Educational Resources:

Etrade’s educational resources are very comprehensive because they offer you very well written articles with relevant content. Also, the broker offers you:

  • Investment ideas
  • Fundamental data
  • Videos
  • Trading ideas
  • Recommendations for many financial instruments.

It seems to us a pity that there is no possibility of testing the Etrade investment platforms with a demo account, especially considering that most other brokers, in particular those that offer an independent trading platform such as Etrade, always allow you to use the software and to get acquainted with it before risking your money. Due to this, Etrade significantly loses points in this ranking.

E-trade Demo Account & Educational Resources Score: 2/10

#10 Safety & Regulation

Etrade Securities LLC (ETS) is registered with the Securities and Exchange Commission (SEC) as a broker-dealer and is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).

Etrade is a broker that stands out for its high degree of credibility and trust as it is regulated by institutions with a high reputation in the investment field. Therefore, when you transfer your capital to this broker you can rest assured that your funds are safe, and for this reason, the broker has a perfect rating in this section.

E-trade Safety & Regulation Score: 10/10

While researching 100+ of the world’s top brokers, we’ve noticed what works and what doesn’t from the customer’s point of view. That’s why our final test for any broker is to compare it to Capital.com, which scores 91/100 points across the 10 categories mentioned in this review.
Etrade vs. Capital.com

Etrade vs. Capital.com

Being a winning trader requires a solid investment plan. Take into account that the stock market is a world that is constantly changing and for this reason your strategies must adapt to the movements and innovations of the market. We recommend that you choose a broker that is your ally and that allows you to fully exploit your profits.

In this sense, this broker must allow you to diversify your portfolio internationally with the range of financial instruments that it offers and that also saves you hundreds of dollars in commissions. In this section, you will find a comparison between Etrade and Capital.com. After an in-depth market study, we consider that your best ally is Capital.com for the following reasons:

The Best Investment options

Etrade has a good number of financial instruments that you can invest in. However, Capital.com offers you several more possibilities because, on its investment platform, you will be able to access a greater number of financial instruments and it offers the possibility of investing in the Forex market and cryptocurrencies. This feature is really important because with Capital.com you will be able to have a greater capacity for diversification when building your investment portfolios.

It Offers An Unlimited Demo Account

As we mentioned earlier, one factor that is essential when testing an investment platform is being able to access a demo account. In this aspect, Etrade falls short because it does not offer one. With Capital.com, on the other hand, you can truly test the platform since you will be able to use an unlimited demo account to test each one of the tools and features of the investment portal, even after you start trading with real money.

Quick and easy account opening

If you want to trade now without having to wait for days struggling to verify your trading account, we recommend you visit Capital.com. You can open your account and trade in less than 20 minutes.

Etrade In Summary

  • Etrade is a United States broker and is registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).
  • The broker offers you several types of accounts: brokerage, retirement and managed portfolios.
  • The account opening process at Etrade is entirely online.
  • Etrade does not set a minimum initial deposit.
  • Etrade offers you several platforms so you can choose the one that best suits your needs and tastes.
  • The customer service you will find at Etrade is of very good quality.

You could consider Etrade as an option if you are an American trader looking for a broker that offers different types of accounts for both active and passive investments, with a variety of deposit and withdrawal options, that does not require a minimum deposit and that is heavily regulated.


However, we think that Capital.com is a much more efficient alternative because it not only covers all the aspects in which Etrade is good, but it also offers you more features that make it a better option. For example, Capital.com offers you excellent customer support, a great demo account, a faster account opening process and also allows you to create efficient, diversified and low-risk investment portfolios. If you are ready to start your trading career or want to move to the next level we think Capital.com is a great choice.

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