Schwab vs. TradeZero Introduction
For high-powered trading, both Schwab and TradeZero have many tools and resources that are worth considering.
Cost
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
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Charles Schwab
|
$0
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$49.95 ($0 to sell)
|
$0.65 per contract
|
$0
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$0
|
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TradeZero
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$0
|
na
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$0.59 per contract
|
$0
|
na
|
Services
| Broker Review |
Cost |
Investment Products |
Trading Tools |
Customer Service |
Research |
Overall Rating |
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Charles Schwab
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TradeZero
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Promotions
Charles Schwab: $0 commissions + satisfaction guarantee at Charles Schwab.
TradeZero:
Trade stocks, options & ETFs for free.
Tradable Products
TradeZero customers can buy and sell stocks, options, ETFs, and closed-end funds. There are no other asset classes available. The company has shut down its crypto service.
Schwab has everything TradeZero has plus annuities, futures contracts, bonds, and mutual funds. It also offers access to some foreign stock exchanges.
Besides all of the self-directed trading, Schwab (but not TradeZero) offers investment-advisory accounts.
Winner: Schwab
Margin
Because both broker-dealers in this contest try to deliver a professional-level trading experience,
margin accounts of course are available. Right now, Schwab customers pay anywhere from 12.575% to 10.825%.
TradeZero skips the traditional tiered system and charges a flat
9% across all margin levels.
Winner: TradeZero
Computer Trading
Schwab has several platforms for computer trading. The first is its website, which, although rather simple in design, does nevertheless deliver some good trading and research tools. These include an order ticket with trailing and stop orders, a discrete ticket for options, and equity reports in pdf format from several analysts.
A browser platform brings trading to a somewhat higher level with much better charting. Resources include drawing gadgets, technical indicators, and a full-screen mode.
Finally, there is a desktop program that delivers even more. The desktop system has a demo mode for extra practice.
TradeZero also has multiple platforms for computer trading. The downside is that the best platforms come with a monthly fee, which is $59 (Schwab has no software fees). ZeroPro is the most advanced of the group. It is a desktop program that comes with lots of advanced features, like custom layouts, options trading, and hotkeys.
TradeZero does have a free computer platform. Called ZeroFree, this one curtails the experience quite a bit. For example, there are no alerts or option tools at all. And the number of Level II windows is capped at just one. Hotkeys are available, but they cost $15 per month.
Winner: Schwab
Mobile Apps
Moving on to mobile trading, neither brokerage firm charges any monthly fees to use its mobile app. Schwab actually has two of them. One of them is designed for futures trading. Combined, the two platforms deliver tons of useful resources, including live streaming of CNBC, lots of market news and security research, discrete tickets for options and mutual funds, and much more.
The better charting will be found on Schwab’s main app. Here, we found both vertical and horizontal charts with lots of tools. Examples include:
7 plot styles
Company events
30 technical studies
One feature not found on either Schwab app that will be found on the TradeZero app is a short-locate widget. Locates can be allocated to an account in real time. Other resources on TradeZero’s app include news articles, a watchlist, and charting with indicators. At this time, options cannot be traded on the TradeZero app, which we view as a huge drawback. Schwab’s apps offer multi-leg trading (via either custom or pre-installed spreads).
Winner: Schwab
Day Trading
Through a sister company in the Bahamas, TradeZero offers accounts that don’t have to follow day-trading rules established by FINRA. This includes the $25,000 account requirement. Here are some other issues day traders should be aware of:
Leverage: Schwab and TradeZero America offer up to 4:1 day-trading leverage. For accounts above $2,500, TradeZero Bahamas offers up to 6:1 leverage.
Direct Access to Venues: Schwab and TradeZero both offer direct-access routing.
Extended-hours Trading: Available at both firms. Futures contracts at Schwab trade 24/6.
Level II Quotes: Available at both firms.
PDT Status: TradeZero, but not Schwab, shows the number of trades an account has before hitting pattern day-trading status. The tracker is on the website.
Maker-Taker Fees: TradeZero has them.
Shorting: It’s possible to take short positions at either broker-dealer. Only TradeZero has a short-locate tool.
Winner: TradeZero
Extra Services
Initial Public Offerings: Only at Schwab.
Fractional-share Trading: Schwab customers can trade the S&P 500 stocks in whole dollars.
IRA Service: Schwab, but not TradeZero, has Individual Retirement Accounts.
Automatic Mutual Fund Purchases: Schwab has it.
Fully-paid Securities Lending Program: Again, only at Schwab.
DRIP Service: Once again, only at Schwab.
Winner: Schwab
Recommendations
Long-Term Investors & Retirement Savers: Definitely Schwab.
Beginners: A robo account with Schwab is a good way to start.
Active Stock Trading: Schwab is obviously better for fractional shares, foreign stocks, and no platform fees. For shorting and day trading, TradeZero is better.
Mutual Funds: The only option here is Schwab.
Small Accounts: TradeZero requires at least $2,500 in assets before any trading can commence. Thus, we recommend Schwab.
Promotions
Charles Schwab: $0 commissions + satisfaction guarantee at Charles Schwab.
TradeZero:
Trade stocks, options & ETFs for free.
TradeZero vs Schwab Verdict
TradeZero comes out ahead as the broker with the most advanced services, although Schwab is the better
value due to its free software and no account minimums.
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Updated on 1/30/2025.
Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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