TD Ameritrade 300

Etrade Penny Stock Commissions and Fees. Etrade OTCBB Stocks Trading.

Etrade penny stock commission, fees charged for buying pink sheets/OTCBB/stocks priced under $1 in 2017. Rules and policy. Is Etrade good for penny stocks trading?

Does E*Trade Offer Penny Stocks?

Yes, investors at E*Trade will find a good selection of over-the-counter stocks available for trading with the broker’s technology. OTC securities tend to have lower volume and less liquidity than equities that trade on one of the major US exchanges. This creates an environment that is much more volatile and risky. Also known as penny stocks, OTC equities can be boom or bust.

E*Trade Penny Stock Fees

E*Trade penny stock commission $6.95
E*Trade active trader discount $2 lower commission for clients making 30+ trades per quarter
E*Trade penny stock surcharge $0
E*Trade large order surcharge $0
E*Trade ECN surcharge $0.005 per share surcharge on extended hours trades (ECN fee) and on trades executed through E*TRADE Pro at an ECN during both regular market and extended hours sessions

E*Trade stock and ETF commission is $6.95 per trade (drops to $4.95 per trade if making 30+ trades per quarter), options commission is $6.95 plus $0.75 per contract (drops to $4.95 plus $0.50 if making 30+ trades per quarter). E*Trade and firms in the Best Penny Stock Brokers list do NOT have surcharges and additional fees on Pink Sheets/OTCBB/stocks priced under $1.


TD Ameritrade’s stock screener can search specific exchanges, including the OTC markets. Because E*Trade doesn’t offer this capability, finding penny stocks is rather difficult.

On the flip side, E*Trade customers don’t have to pay a surcharge to trade OTC stocks. Ally Invest, by contrast, charges 0.5¢ for stocks that trade under $1.

Merrill Edge traders must have at least $25,000 in assets before they can start trading OTC securities. And even then, the broker doesn’t allow more than 20% of an account’s value to be in penny stocks. E*Trade has no such requirements.

OTC Stocks Available at E*Trade

The E*Trade stock screener returns over 2,000 stocks that trade under $4. Unfortunately, the broker’s screener doesn’t have the ability to search exclusively for securities that trade on OTC exchanges.

One example of a penny stock that E*Trade customers have access to is 3PEA International, Inc. This security trades on the OTCQB market, and its ticker symbol is TPNL. Its most recent trade price was $0.42. It does not pay a dividend, although it does provide financial statements.

A second OTC security that appears in E*Trade’s screener results is Aerius. The ticker symbol is AERS. The stock’s profile page does not show any news, but Aerius’s average volume is above 30,000, a good number for a penny stock. Its last trade price was less than 1¢.

Buying a Penny Stock

E*Trade does not charge any additional fees for OTC trades. The broker’s regular $6.95 commission applies. There is also a $2 discount for active traders. Penny stocks can be traded on the website, the broker’s mobile app, and its desktop platform. Unfortunately, the E*Trade site doesn’t have a trade bar.

When you’ve found a penny stock you want to buy or short, submitting the order is just as easy as placing a trade for a regular stock. Clicking on a buy or sell button on the stock’s profile page produces an order entry form. Both market and limit orders can be used.

Can You Short Penny Stocks on E*Trade?

Short selling of OTCBB and Pink Sheets on E*Trade is not allowed.

Risks of Trading Over-The-Counter

The big exchanges in the U.S. have strict requirements that a company must meet in order to get listed. The OTC market, by contrast, has few requirements and little government regulation. Because there is less oversight, there is a greater possibility for criminal activity and other fiascoes.

Etrade Bonds Review

At Etrade clients can choose from over 50,000 bonds - one of the largest selections of bonds available online. The company offers great bond trading and research platform with graphical charts to help you find bonds that match your criteria. Clients also get unbiased bond recommendations - specific advice from professionals who are not paid on commission.

Etrade offers a "bond ladder" - a portfolio of fixed-income securities that mature at regular, staggered intervals. You can also build a ladder with brokered CDs. Laddering is an investment technique designed to generate income based on an investor's unique situation, whether to support ongoing cash flow needs or plan for those expected to arise in the future. It can also reduce one's exposure to interest rate fluctuations.

Updated on 9/22/2017.

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