Scottrade vs Etrade: The Matchup
Scottrade and Etrade are two of America's better known low-cost brokerage firms who advertise heavily and offer investors numerous financial
products and services. So which of the two is the better broker - Scottrade or Etrade? Let's find out.
Pricing, Fees, and Account Minimums
Scottrade’s standard charge for trading stocks and ETF’s is $7, while Etrade charges much higher $9.99.
Etrade has a discount of $2 per trade for investors who place more than 150 trades per quarter. Investors who trade options will pay an extra
$1.25 per contract at Scottrade, and $0.75 at Etrade.
Brokerage accounts at both Scottrade and Etrade carry no inactivity fees or account maintenance fees. The minimum initial deposit to open a
brokerage account at Scottrade is $2,500 ($0 for IRA), and at Etrade it's $500 ($0 for IRA).
Overall, Scottrade wins in this category.
Etrade offers more than 8,000 mutual funds, of which 1,300 carry no-load and no transaction fee. Mutual funds that carry a transaction fee are
Scottrade offers more than 14,000 mutual funds, almost 3,000 of which come with no load and no transaction fee. No-load mutual funds that do carry
a transaction fee are $17 on both the sell and buy ends, when traded on-line. Load funds are free to buy, but cost $17 to sell.
Scottrade clearly wins in the mutual fund arena.
Research and Education
Etrade has a variety of educational resources for its customers, consisting of on-demand videos, articles, and in-person seminars at select cities.
An assortment of topics are covered, such as fixed-income, options, and IRA’s. Etrade also offers futures research, including a dedicated futures
customer service phone line.
Scottrade falls short in this category. Research tools are on the moderate side. There are no third-party reports available. Scottrade offers
investment education on a web page called Knowledge Center, where traders will find articles and videos on a variety of topics.
Etrade wins in this category.
Scottrade is famous for having numerous brick-and-mortar branches across the United States to help their customers personally. The broker currently
has more than 500 branches nationwide. Scottrade's customer service is rated as one of the best in the industry. Etrade has just 30 branches. However,
Etrade offers 24/7 telephone customer service, whereas Scottrade is only available 5:00 AM to midnight (CST), Monday through Friday, and 8:00 AM to
6:00 PM on the weekend.
Overall, Scottrade has a slight edge over Etrade in this category.
Scottrade’s web site is fairly simple and not very sophisticated. A step up from the web site is Scottrader Streaming Quotes, a Java-based system
launched from the web site. For active traders, there is ScottradeELITE, the broker's flagship trading platform.
Etrade's web site is more sophisticated and user friendly. The broker's Total Trade Ticket can be used to place orders for stocks, options, and
ETF’s. Advanced platforms are available for frequent traders. Etrade Pro is a desktop application, and Etrade Marketrader is a browser platform.
This category goes to Etrade, primarily for their well-designed web site.
Etrade has applications for Windows phone, iPhone, iPad, Android phone and tablet, Amazon Fire phone, and Kindle Fire HD. The iPhone app has the
most features. The interface is easy to navigate. Users will find charts, a trade ticket, mobile check deposit, educational videos, and many other
Scottrade has applications for Android, iPhone, iPad, and mobile web. The interface is intuitive and user friendly. Users can read market news,
place an order, search for options, and look over position and account data. Unfortunately, mobile check deposit isn’t available, nor is the ability
to contact customer service.
Etrade easily wins in this category.
Cash Management Features
Both brokers have FDIC-insured banks that offer deposit accounts with the standard insurance of $250,000. Both firms offer free checks and a debit
card. In order to open a Scottrade bank account, clients must have at least $500 in a Scottrade brokerage account.
Scottrade does not allow its customers to transfer funds out of a Scottrade brokerage account to an external bank account via ACH, although
Etrade has a slight edge in this category.
Etrade offers futures trading and research, including the ability to trade more than 200 futures products. The futures trading platform has no fee,
and there is a dedicated futures customer support team.
Scottrade does not offer any services on futures (not that many investors trade futures), however it has a unique and better than the competitor's
version of dividend reinvestment program that so many more people will find useful.
Etrade loses in this category.
Scottrade vs Etrade: Results
As you see Scottrade and Etrade are pretty
evenly matched in this online broker comparison.
Both firms provide their customers with intuitive trading tools. Scottrade also offers over 500 local branches where clients can visit and
talk with a representative face-to-face. The firm's biggest disadvantage is the additional commission on penny stock trades (Etrade has a surcharge
on ECN Etrades). Also, Scottrade's website inside the member area looks dated and in need of better design.
Thanks to easy to use trading tools, proactive and helpful customer service, largest network of local offices as well as plethora of
learning materials, Scottrade is one of the best brokerages for beginner investors.
Overall, both of these brokers are excellent and will definitely be a good fit for a majority of investors. Based on much lower commissions, which means
huge savings over the years, we recommend Scottrade to most customers, especially to beginners, retirement and mutual funds investors.
Updated on 11/25/2015.
Review discount online brokerage firms comparison: Scottrade or Etrade? Differences between investment companies. Recommendation for stocks, options, ETFs, mutual funds, bonds investors. Etrade versus Scottrade for beginner
investors, long term, individual retirement accounts, active/day Etraders. See what stock broker service is better, cheaper, offers lower fees, cost, rated higher and easier to use. Which broker should you choose?