Overview of Tradier Brokerage
A very unique investment firm founded just five years ago is Tradier Brokerage. With this broker, traders choose their own platform from a third party
and pay some pretty low commissions and fees. The company made its first appearance in Barron's online brokers survey
list this year. Let's check it out.
Tradier received an overall score of 27.9 out of a total possible 40.0. This translates into 3½ stars out of 5. The financial newspaper especially liked Tradier's usability, which undoubtedly comes down to its user-friendly website and choice of trading platforms.
Barron's also gave the brokerage house 4.0 stars out of 5 for its pricing schedule, which is very competitive. The company received 3.7 stars for mobile trading, although it doesn't have a mobile app (more on that later). Tradier also received 3.6 for research amenities.
Next is portfolio analysis & reports at 3.4. For range of offerings, the firm got only 3.1 (no OTC or pink sheet stocks are available). Tradier performed worst in the category of customer service, education, and security; receiving just 2.9 stars.
Barron's admitted that it was hard to grade Tradier because its own software does not appear on the front end of the company. The broker does all the work behind the scenes. There are about 100 software companies that work with Tradier.
Data and account settings are stored in the cloud. The broker's customers can subscribe to more than one software provider. So, for example, you could use one platform for stock trading and another for options. The platforms do normally come with a monthly fee, although some of them can be waived with a minimum level of activity. Tradier itself does not have a mobile app; although its partners do have them, and trades can be placed on them.
Tradier charges just $3.49 for stock and ETF transactions, very low by industry norms. The broker will not accept opening orders for over-the-counter or pink sheet stocks, however.
Option contracts are just 35¢ with no base charge. There is a $5 minimum commission for single leg orders, and a $7 minimum for multi-leg orders. Assignments and exercises are $6. Writing uncovered puts requires a $25,000 account balance, and writing uncovered calls requires four times as much.
The brokerage house has live reps who can assist clients with trades. Using this service costs an additional $10, another industry low.
A brokerage account can be opened at Tradier with no minimum opening deposit. There is a $50 inactivity fee that is assessed annually. However, it is waived for the first year. In subsequent years, it can be avoided by maintaining a $2,000 account balance or placing at least two trades every 12 months.
By default, monthly statements and trade confirmations are in electronic format, and there is no charge for them. Requesting a hard-copy statement incurs a $6 charge, while trade confirmations are $3 each.
Moving a securities account to another firm via ACAT costs $75 at Tradier. Individual Retirement Accounts carry a $30 fee per year. Closing one is an additional $60.
Margin is available with the broker. Loans currently cost a very low 3.75% per annum.
The brokerage company is rolling out a new flat-fee commission schedule that will really benefit active traders. Unlimited stock trades will cost just $19.95 per month. Unlimited option contracts are $99. The flat-fee system is available through a few platforms. These include Key2Options, Chart IQ, Equities.com, and EF Hutton. Barron's commented on this package favorably and ranked Tradier as one of the best firms for frequent traders, awarding the broker 4 stars out of 5 for that category.
Although Tradier doesn't offer OTC securities, it does provide access to mutual funds and fixed-income products. These investments must be traded over the phone with a representative, however. Also, the broker does not offer municipal bonds.
Customer Service and Protection
Tradier can be contacted only during the weekday from 8:00 am until 5:00 pm, EST. Curiously, the company's phone number is not toll-free. There is a service e-mail address, but Tradier warns that it may take up to one business day for it to respond.
Is Tradier Safe and Insured?
Tradier is a member of FINRA, the securities industry self-regulatory body. It is also a member of SIPC, the primary insurer of brokerage
accounts. Each Tradier account is protected up to $500,000, of which $250,000 can be applied to cash balances. More on this is discussed in
Is Tradier safe? article.
Tradier is unique in offering the ability to use multiple platforms. Some investors may prefer this setup. The option of choosing one platform from several selections is also appealing. There are a few online brokers who provide more than one platform, but usually the second trading system is much less advanced and is designed for amateur traders. TD Ameritrade and Scottrade both have this system.
Tradier's commission schedule is also very attractive. Schwab and TradeKing recently lowered their equity commissions to $4.95. This appears low compared to E*Trade, but not Tradier's $3.49 fee. The broker's 35¢ derivative fee is also cheaper than many other firms, including OptionsHouse and optionsXpress.
The new flat-fee trading schedule could be an unbeatable deal for active traders. One hundred trades at Firstrade, for example, would cost $495. But under Tradier's flat pricing schedule, the same trades would only cost $19.95, assuming they were all placed in the same month.
On the bearish side, Tradier's IRA fee is disappointing. Most brokers have eliminated annual fees for retirement accounts. These firms
include TD Ameritrade and Fidelity. Tradier's account transfer fee is higher than Vanguard's, which is $0.
Tradier Review Summary
Tradier has a very interesting trading scheme, which has attracted the attention of Barron's.
Although it performed well only in a few categories, it's a new company with a lot of future potential. Given the broker's very
appealing commission schedule, it will undoubtedly attract more attention from this point forward.
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