Capital One Investing began as NetStock Direct in 1996, which later changed its name to ShareBuilder Securities Corporation. ShareBuilder was purchased
by ING Direct in 2007, before being bought by Capital One Financial Corporation in 2012. The new parent company renamed ShareBuilder to Capital One
The company's strengths are competitive commission rates and a few unique products and services. One is their PortfolioBuilder feature, which allows
customers to purchase up to eight ETFs at a time based on their investment amount and preferences. Another great feature is ShareBuilde program that
to invest any set amount of money on a regular basis to take advantage of dollar-cost-averaging. They also offer professional advising services both
over the phone, and in person at a limited number of Capital One Bank branches.
Capital One offers only basic investment products such as stocks, ETFs, mutual funds, and equity options, so investors who want to trade fixed-income
investments, currencies, or futures should consider other brokers.
- $6.95 commissions on stock and ETFs
- $6.95 + $0.75/contract commissions on options
- $19.95 commissions on mutual funds, but $0 for more than 400 No Transaction Fee (NTF) funds
- $19.95 commissions for broker-assisted trades
- $3.95 per investment for ShareBuilder trades
- $18.95 for an entire portfolio in PortfolioBuilder
- No minimum investment to open a cash account; $2,000 minimum to open a margin account
- No inactivity or annual maintenance fees
- Mobile trading with smartphone apps
ShareBuilder Website/Trading Platform/Tools
The website is well designed and easy to navigate. Opening a trading account is fast and easy. If linked to a Capital One bank account, funds can be instantly transferred to and from a brokerage account.
The rudimentary trading platform is easy to use but not designed for active or sophisticated traders. Tabs for ShareBuilder and PortfolioBuilder are
shown on the Investing toolbar, and traders can quickly choose between placing stock, option, or mutual fund trades. Trade confirmations are
sent immediately via email, not the next day as with many other brokers.
Research amenities include customizable interactive charts, heat maps, and a basic investment screener that can use popular searches or a customer's
own parameters. Another interesting tool is What If I Had Invested feature. This lets a trader see how a stock might have performed if it has been
bought on a past date.
Research sources include Morningstar ratings and reports as well as Markit Research Team Consensus reports, which combine ratings and analysis from up to 13 research providers in one easy-to-read package.
The website's Knowledge Center contains a wide variety of articles on investing topics for beginner, intermediate, and advanced experience levels
Other features offered by Capital One include Dividend Reinvestment Plans (DRIP), which are available at no cost and can be set up quickly after a
purchase has been made, as well as small business 401(k) retirement plans that use the ShareBuilder funding and commission structure. Customers who are
also members of Costco get a discounted commission schedule that offers substantial savings on ShareBuilder and PortfolioBuilder investments along
with a $1 discount for stock, ETF, and options trades.
- No minimum investment to open an account
- No minimum balance or maintenance fees
- Low cost automatic investment plan through ShareBuilder
- Easy, cost-effective portfolio creation with PortfolioBuilder
- Free DRIPs
- No-fee IRA
- Banking services available through parent company Capital One
- No extended hours trading
- No short selling allowed
- Trading tools are rudimentary
- $49.95 early redemption fee on NTF mutual funds held less than 90 days
- $0.007/share surcharge for stocks or ETFs priced under $1.00
- Limited news and research sources compared with other leading brokers
- Automatic investing plan trades are only made on Tuesdays
Capital One Investing is geared more toward beginning investors and buy-and-hold clients who
do not trade actively. Investment products offered are limited to stocks, ETFs, options, and mutual funds. The trading platform is weak, and trading
tools, news, and research resources are simplistic and limited in scope.
$0 minimum balance requirement for cash accounts as well as the ShareBuilder and PortfolioBuilder plans will appeal to new and inexperienced investors.
The low commissions on these two products make them a compelling option for investors who want to use dollar-cost-averaging or to build a basic portfolio
Active investors, however, will not be happy that the company does not offer extended hours trading or short selling. The lack of a powerful, comprehensive
trading platform is not helping as well. There is not much that would attract mutual fund investors either, since commission rates
are about average and Capital One only offers around 400 NTF mutual funds (Scottrade, for
example, has over 2,600 NTF funds).
Open Capital One Account
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