Stock Brokerage Firms That Offer Free Level 2 Quotes


See which discount online brokerage companies accounts are offering level 2 stock quotes: Merrill Edge, TD Ameritrade, Charles Schwab, Etrade, Fidelity Investments, Ally, Scottrade, Vanguard, Wellstrade, Interactive Brokers, and TradeStation.



Discount Brokerage Firms That Offer Level 2 Quotes


Brokerage Rating Offers Level 2 Quotes Level 2 Quotes Cost
New Account Promotion
Ally InvestAlly Invest rating

YesFree if a client does 25 or more trades per month Get $3.95 stock trades if you make 30+ trades per quarter or have 100K account balance.
TD AmeritradeTD Ameritrade rating

YesFreeTrade free for 60 days + get up to $600.
Capital One InvestingCapital One Investing rating

NoNAGet $50 when you open new non-IRA account at Capital One Investing.
Charles SchwabCharles Schwab rating

YesFree to non-professionals who make 30 trades during a quarter or maintain $1 million or more in Schwab balancesMake $100,000 deposit and get 500 commission-free online equity and options trades.
EtradeEtrade rating

YesFree to customers that trade 30 times or more during a quarter, otherwise $99.95/month At E*TRADE, get $6.95 trades + 65₵ per options contract.
FidelityFidelity Investments rating

YesFree if a customer has at least $25,000 on the fidelity account and does more than 120 trades per yearGet 500 free trades with $100,000+ deposit.
FirstradeFirstrade rating

Yes$19.95/monthUp to $300 Cash Rewards + 500 Free Trades.
Interactive BrokersInteractive Brokers rating

YesFree if a customer trades at least $10/month in commissions, otherwise $20/monthNone
KapitallKapitall rating

NoNANone
Merrill EdgeMerrill Edge rating

YesFree to customers who have $1 million in Merrill Lynch accounts and Bank of America or make at least 30 trades during a quarterNone
Motif InvestingMotif Investing rating

NoNANone
RobinhoodRobinhood Trading rating

NoNANone
ScottradeScottrade rating

Yes$9.95/month or free to accounts with 10 or more commissioned trades per monthTrade free for 60 days + get up to $600.
TradeStationTradestation rating

Yes$10/month for non-professionals, $110/month for professionals Get $5 per trade stock and ETF commissions. $4 per trade for IRAs.
USAAUSAA rating

NoNANone
VanguardVanguard rating

NoNANone
WellsTradeWellstrade rating

NoNANone


Level 2 quotes are an indicator used by both retail and professional traders to find clues for near term price direction in stocks. Offered on NASDAQ securities, Level 2 quotes show the order flow for any given stock during market hours, ranked by bid and ask levels. These quotes go beyond the simple bid and ask displayed on the basic level of price quotation for placing trades. More important than the price is the part of the quote that indicates who the buyer or seller is, and in what size they are trading at that moment.


Level 2 Participants and Symbols


Every market participant will be identified by a four-letter code, seen right next to the order to buy or sell. For example, JP Morgan is seen with the code JPHQ every time that they initiate a trade. This is important since it sends a message to market participants of who is trading in the stock, and in what size, which may indicate interest by large institutions. To the right of the code is the current bid/ask and then the number of shares in the trade.

The three types of market participants are 1.) market makers creating liquidity, 2.) Electronic Communications Networks (ECN) and 3.) wholesalers. Wholesalers often execute orders for online and retail brokers, while anyone can trade through ECNs.


Why Level 2 is Important to Retail Traders


For retail traders, Level 2 quotes can be helpful to display which types of market players are trading a specific stock, and in what direction. If a trader can see a large market maker buying a trending stock, then trading along with them may result in a short-term profit. This tends to work best for day traders in stocks, catching smaller price movements. One can also notice optimal times to get out of a trade, by watching irregularities in the bid and ask as larger traders start to exit their positions. Naturally, these skills take some time to perfect, but may offer a slight advantage to those who are willing to make the effort.

None of this is a guarantee for the retail trader, and is really only one of many tools that should be used for successful stock trading. For instance, large institutions and market makers can disguise trades by using the ECNs or through placing smaller orders that escape obvious attention. All of these participants are professionals that know how to profit from the system in place, and they have the weight of experience on their side. But if one day trades frequently and would like more data or information on stock prices, then having Level 2 may be desirable.


Brokerages That Offer Level 2 For Their Retail Customers


Most retail brokerages have access to Level 2 for their customers, but because of its value not all offer it for free. In many cases, it depends how often a customer trades (meaning how much they spend on commissions), and whether they are professional traders. Most professional traders are required to pay a monthly fee for access, while non-professionals have other ways to qualify.

There is only one retail brokerage offering Level 2 quote service completely free to non-professionals, regardless of activity level or account size, and this is TD Ameritrade. Actually, no other company on the matket right now comes close to offering the same level of trading tools free of charge as TD Ameritrade.

From there, the best deals for the non-professional are those that offer Level 2 for making a minimum number of trades each month or quarter, typically requiring 25 to 30 trades. This is not a high level of trading for one who plans to use Level 2, averaging about a trade a day for complimentary access. Brokerages with this entry level are Schwab, Etrade, Merrill Lynch, Scottrade and Ally Invest. It is worth noting that if an Etrade customer does not make the 30 trades per quarter required, then Level 2 quotes are $99.95 per month.

Other brokerages may charge a flat monthly fee to access Level 2 quotes, such as Firstrade and Tradestation at $19.95 and $11.00 respectively, while others require an account minimum like Fidelity, if you don’t trade more than 120 times a year. The most straightforward offering is from Interactive Brokers where one must spend $10 in commissions per month, or pay a monthly fee of $20 for access. A few brokerages don’t offer Level 2 at all, including Vanguard and Capital One Investing.

The access and cost of Level 2 quotes are only one consideration when selecting a broker for stock trading, but depending on other factors this may be important to some traders. Anyone committed to day trading and understanding more about the large market participants who are buying and selling, could profit from a Level 2 service.


Updated on 10/20/2017.




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