Ally Invest versus E-TRADE

Ally Invest vs Etrade


Ally Invest or Etrade - which is better in 2018? Compare IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.



Overview


Investors looking for the best value in brokerage services will find two prime candidates with E*Trade and Ally Invest. Both companies offer low commissions, discounts for active traders, research tools, cash management features, and more. Here’s a detailed look at the two firms that will find out who is better - E*Trade or Ally Invest.

Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
Ally Invest $4.95 $9.95 $4.95 + $0.65 per contract $0 $0
Etrade $6.95 $19.95 $6.95 + $0.75 per contract $0 $0

Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
Ally Invest
Etrade


Fees and Commissions


E*Trade customers pay $6.95 for stock and ETF transactions. ProElite clients (defined as 30 or more trades per quarter) pay only $4.95. Options cost 75¢, and clients who meet the active trader requirement pay only 50¢. The broker charges $2 for a printed statement.

Ally Invest charges $4.95 for ETF and stock trades. Customers who placed 30 or more trades in the previous quarter, or who had at least $100,000 in assets, pay only $3.95. Option contracts are an extra 65¢, while traders who meet one of the above requirements get a 15¢ discount. Paper statements are $4 each.

Live brokers are available over the phone at both firms to help traders submit orders. At E*Trade, this service costs $32. Ally Invest customers pay nothing extra for the service for the first few times. Afterwards, the broker tacks on a extra $20.

Neither brokerage house charges an annual account fee, or any other on-going fees for maintenance or inactivity. E*Trade clients must deposit at least $500 to open a securities account, while Ally Invest has no minimum.

Fixed-income at E*Trade is priced on a markup or markdown basis for U.S. Treasury bonds and corporate bonds on the primary market. Secondary corporates are $1 each, with a $10 minimum and $250 maximum. Ally Invest has the same prices, except CD’s cost $24.95.

Ally Invest wins the first category.


ETF’s and Mutual Funds


The mutual fund screener at Ally Invest returns roughly 8,000 products, of which 1,700 carry no load. The broker does not offer any funds that have neither load nor transaction fee. Any fund at Ally will have either a load or a transaction fee. No-load funds cost $9.95 for purchases and sales, while a load will be stated in a fund’s prospectus. There is no short-term redemption fee at Ally Invest.

E*Trade’s mutual fund search tool displays over 9,000 securities that are available for purchase. Over 4,000 are no-load, no-transaction-fee products. The broker does charge a short-term redemption fee of $49.99 if an NTF fund is sold in less than 90 days. E*Trade’s transaction fee is $19.99, and it’s applied on both the buy and sell sides.

Both companies offer exchange-traded funds, and they have effective ETF screeners. E*Trade offers 105 that are commission-free, and they carry a short-term redemption fee of $19.99 if they are sold in less than a month. Ally does not provide any ETF’s commission-free.

The two brokers are tied here.





Customer Service


Both brokerage firms offer customer service 24/7. They also both provide an on-line chat feature and phone numbers for traders who are temporarily outside the U.S. E*Trade operates 30 branch locations, while Ally Invest has none. Both websites offer useful self-help features for services such as acquiring tax documents and updating account information. Ally Invest has a trader community and blog where customers and Ally Invest representatives can communicate. E*Trade offers an on-line community, but no blog.

This category is a tie.


Trading Tech


When Ally purchased TradeKing, it simply incorporated the old broker’s website into ally.com. A basic trading platform named Ally Invest LIVE is part of the broker’s website. It operates in a browsing window. It is able to display a chart, show live quotes, and submit orders. There is no desktop platform available with Ally Invest.

Charting on both Ally Invest LIVE and the regular website offers technical indicators, company events, comparisons, and several chart styles. Ford Motor Company’s price history goes back to 1980.

There is also a trade bar on the Ally Invest website. It sits at the bottom of the browser and provides security data, such as volume and bid-ask spread. Orders for stocks, ETF’s, and options can be submitted on the trade bar.

E*Trade’s site doesn’t have a trade bar, but orders can easily be placed using web pages. The broker offers a very extensive bond-trading section, which is more advanced than Ally’s. E*Trade 360 is a browser-based trading system similar to Ally’s. An order ticket can quickly submit orders for stocks, ETF’s, and options. A more sophisticated desktop platform called Etrade Pro is available to ProElite customers. Alternatively, the broker will accept an account balance of at least $250,000.

Charting on the E*Trade website comes with technical indicators, comparisons, and different graph styles. Ford Motor Company’s stock price stretches back to 1980, like Ally’s chart.

E*Trade wins this category for having a desktop platform.


Ally Invest vs E*TRADE


Trading on Mobile Devices


The regular Ally Financial mobile app now has brokerage account information. There are watchlists, account data, and market news. The news appears only in article format. There is no live streaming of financial news. Option chains are available, along with basic charting. The Ally app functions on phones running Apple, Android, and Windows. Apple, Android, and Amazon tablets can be used, and a smartwatch app can find ATM locations on Apple and Android watches.

E*Trade’s app runs on Apple, Android, and Windows devices. It also functions on Kindle Fire HD and Amazon Fire phone. Mobile check deposit and charting are available. ProElite clients get free streaming of CNBC. The broker also has a platform for Apple Watch.

E*Trade wins mobile trading category.


Investment Advice


Ally Invest offers managed and self-directed accounts. The managed account option costs just 30 basis points per year. This price includes low-cost ETF’s that are traded by human advisors. There is no robo-advisory service, and the broker does not currently offer other securities besides ETF’s. The broker’s managed account option requires at least $2,500 to start.

E*Trade offers managed account services in both human and robo varieties. Adaptive Portfolio is the broker’s computerized trading system. It costs 0.30% annually and requires a $10,000 deposit. Retirement accounts only require $5,000. The service trades low-cost ETF’s, and E*Trade offers the first six months for free. Human advisors cost less than 0.90%. Signing up for one of the available packages will get you other securities such as mutual funds. There is, however, a rather steep $25,000 minimum.

On the whole, E*Trade has the better package here.


Promotion Links


E*Trade: Get 60 days of free trades + up to $600.

Ally Invest: Up to $3,500 cash bonus + commission free trades for new accounts.



Security Education & Research


E*Trade’s website has good learning materials for new and seasoned investors alike. Articles and videos look at many financial issues, including bonds and derivatives. The broker hosts live webinars on its site regularly. There are free stock reports from different analysts, including Thomson Reuters, MarketEdge, CFRA, and SmartConsensus. Effective screeners are available for all the securities the broker offers.

The Ally Invest website provides many articles that discuss various securities, including equities and funds. Videos are noticeably lacking. The broker provides stock reports from just one analyst: CFRA. A stock’s profile page has useful information, including news and financials.

E*Trade takes this category.


Banking Features


E*Trade manages its own FDIC-insured bank. It provides two different types of checking accounts. A basic package has no minimum balance, no monthly fee, but it doesn’t offer refunds of ATM surcharges. The other account offers unlimited ATM fee rebates, but there is a $15 monthly fee. It can be avoided with a $5,000 account balance.

Ally Invest customers can add checks and a debit card to a securities account. There is a $20 annual fee for checks, and a $35 charge for the debit card. ATM fee rebates are not available, and the broker charges $1 for each cash machine transaction.

An easy workaround to Ally Invest’s uncomfortable fees is to open a no-fee account with Ally Bank, which can easily be linked to a trading account. There are no fees with these accounts, the bank reimburses ATM surcharges up to $10 per month, and the savings account pays a very attractive 1.35%.

E*Trade loses here.


Forex and Futures


Ally Invest offers not only securities, but forex and futures, too. The broker provides a separate trading platform for these investments at no cost. Over 50 currency pairs can be traded with reasonable spreads, and futures start at just 45¢ each.

E*Trade offers trading in futures, but not currencies. Like Ally, E*Trade has futures specialists who can assist clients over the phone. The broker charges $1.50 per contract.

Ally takes last category.


Ally Invest vs Etrade - Outcome


E*Trade (read brokerage review) won four categories, Ally Invest (read brokerage review) succeeded three times, and there were two ties. E*Trade wins narrowly by score, while Ally takes the crucial Pricing category.

Thanks to a huge difference in pricing for stocks, ETFs and mutual funds, which means savings of thousands of dollars over the years, Ally Invest has an edge in this online broker comparison for price conscious investors. E*Trade, however, is a great choice for bond investing and mutual fund investors.