Firstrade rating

Firstrade Review


Firstrade Commissions, Fees, and Minimum Deposit


InvestmentsCommissions
Stocks and ETFs $2.95
Stocks, ETFs, and mutual funds broker assisted $19.95
Options $2.95 + $0.50 per contract
Mutual funds $9.95
Treasury Bills, Notes, Municipal and Agency Bonds, Zeros & Strips net yield basis
CDs $30 for primary market CDs, net yield basis for secondary market CDs

Investments stocks, options, mutual funds, bonds, CDs, ETFs
Firstrade minimum deposit to open account $0
FeesFirstrade fees
Promotion linkFirstrade promotions


Traditionally, we start our Firstrade review with pricing. The broker recently lowered its stock and ETF commission from $4.95 to $2.95. Options are just 50¢ extra per contract. Mutual funds with loads are always free to buy, although no-load funds cost $9.95 per transaction. Most fixed-income products are charged on a markup/markdown basis. Placing a trade with a live representative adds an extra fee, which varies depending on the product. Real-time quotes, DRIP service, and electronic statements are free.

An investment account can be opened with no deposit. Firstrade does not impose any on-going account fees, including annual, maintenance, or low-balance charges.


New Account Setup


Opening an investment account at Firstrade Securities is quick and easy using the broker's handy online account application form. First, click on their current promotion: Up to $300 Cash Rewards + 500 Free Trades. At the top of the menu is a link aptly entitled ‘Open an Account’. Clicking on this produces a page where you can enter your name and e-mail address. Doing so generates a new page where more detailed information can be entered, such as account type desired. Many different versions are available, such as individual, joint, and custodial accounts. Trusts, partnerships, and investment clubs can be opened, too, although a paper form must be used.

During the application process, an account can be set up as cash-only or as cash and margin. Options trading can also be appended. The on-line application displays a toll-free phone number for applicants who have any questions, and live chat is also available.


Mutual Funds and ETF's


Once you have a Firstrade Securities account up and running, it’s time to check out the mutual and exchange-traded funds that are available on the broker’s website. Mutual fund information is simply pulled from Morningstar and redisplayed on the Firstrade site. Fund documents are available, including prospectuses and annual reports. A fund can also be added to a watchlist.

Firstrade’s mutual fund screener can search by a variety of criteria, including YTD return, total assets, and minimum purchase. Although the search tool can look for no-load funds, there is no feature to specify no-transaction-fee funds. The screener returns 8,340 securities, and 3,412 of these have no load.

All US-listed exchange-traded funds are available at Firstrade. The broker’s website can display profile information on ETF’s, and again this data is pulled from Morningstar. The ETF screener on the Firstrade site can search by many different criteria, including regional markets and price/sales ratio. It is also possible to save a screen.

Firstrade offers twelve ETF’s for commission-free trading. They must be held at least one month; otherwise, the broker will charge its regular equity commission. Two of the funds on the list are VIG, the Vanguard Dividend Appreciation fund, and IVV, the iShares Core S&P 500 ETF.


Options Trading


Firstrade Securities has some good tools for derivative traders. One is called OptionsPlay, which provides trading ideas for any stock symbol entered. A profit and loss simulator is incorporated into the software. The regular option chain program, which is available only via the trade bar at the bottom of the browsing window, displays regular calls and puts, plus a few strategies.


Customer Service


A Firstrade associate can be reached over the phone anytime from 8 am until 6 pm, EST, Monday through Friday. An online chat function is also available during these hours. The broker-dealer has some agents certain times of the day who speak Cantonese and Mandarin. The broker has an overseas number for clients who are traveling outside the US. The customer service section on the broker’s website has a call back button where clients can request a phone call from the company. There is also a service e-mail address for traders who prefer that method of communication. And of course the broker has a fax number and a snail mail address.

Unfortunately, the brokerage firm does not have a nationwide network of branch locations, which many brokers today do have. Firstrade does hold office hours at its headquarters in Flushing, New York from 8:30 am until 5:30 pm during the week, and there is also a Saturday session that lasts from 10 am until 2 pm.


Trading Technology


Website

Despite being a low-cost firm, Firstrade has a decent website. Unfortunately, the broker has eliminated its desktop platform, so the website is now the primary method of trading. A useful trade bar sits at the bottom of the Firstrade website, and it can be used for several tasks.


Firstrade Review


For example, entering a ticker symbol in the quote field produces vital information, such as most recent trade price, bid-ask spread, and the day’s volume. An order for a stock or ETF can be placed using the ticket. Sell and buy are choices, and order types include limit, market, stop, and trailing. Options can also be bought and sold with the trade bar. Clicking on ‘option chain,’ which appears as an icon on the bar, will produce a pop-up window above the bar.

Clicking on ‘MORE INFO’ on the trade bar produces security information on the ticker symbol that has been entered. This data includes news links, Morningstar information, and a small graph.

The website has several useful tools for Firstrade clients. There is a dashboard that sits under the ‘Home’ tab. It shows the day’s market movers, account balance, indices, and market news. Another tab shows balance and position information, along with a transaction history.

A bond section on the website shows all fixed-income products available to Firstrade customers. A search tool can find bids. New issues are displayed, and there is a bond calculator and a fixed-income guide.

A market research center displays economic sector reports in pdf format courtesy of Morningstar. This section of the website also shows heatmaps, Treasury yields, and videos on investment issues.

There is a stock research section on the Firstrade website. There are pre-defined screens, such as large cap growth stocks and bargain basement small cap stocks. Equity reports are available in pdf format free of charge from Morningstar.

Charting on the website offers several tools, including events, technical studies, and drawing features. A graph unfortunately cannot be displayed full screen, but there are many chart styles, including dot, candlesticks, % growth, 10k growth, and dividend effect. The cursor type can be crosshair or track ball. Extended hours can be added or subtracted from the graph. Some of the available technical studies include Williams %R, Fast Stochastic, and MA Envelope. There is a comparison feature, and data from a chart can be exported to a .csv file.


Firstrade Review - mutual funds


Mobile Trading

Firstrade customers can buy and sell securities on a mobile platform that the broker offers free of charge. It is compatible with Apple and Android devices. A watchlist is incorporated, and market indexes are displayed. The app fails to offer mobile check deposit, funds transfer, or video news.

There is charting on the app, but a graph cannot be displayed horizontally. The maximum time scale is 12 months, and the tick frequency can be set to either 1, 5, or 10 minutes. Styles include candlesticks, bars, line, area, or Heiken Ashi. There are a few technical studies, including MACD and Klinger Oscillator. The data points in these studies can be modified.


Firstrade Review - Mobile


Retirement Accounts


Firstrade customers can open a variety of Individual Retirement Accounts. These include Roth, Traditional, Rollover, SIMPLE and SEP accounts. The broker recently eliminated its IRA termination fee, so closing one is now free of charge. The same commission schedule mentioned above applies to IRA’s. There are many target-date mutual funds available at Firstrade. Some of the fund families include Allianz, BlackRock, and Fidelity.

At the top of the Firstrade website is a navigation menu, and one of the selections is ‘Retirement & Planning.’ Clicking on this produces a variety of resources, including a tax center, education savings goals, and small business plans. There are also a few retirement calculators in this section.


International Accounts


Firstrade offers an international account to investors who aren’t permanent residents or citizens of the U.S. and don’t have a Social Security number or tax ID number. Residents of some countries are not eligible. Authorized countries include Japan, France, China, Singapore, and the United Kingdom. Investors in Chinese-speaking countries could benefit from the broker’s foreign language customer service.


Promotion




Cash Management


Firstrade customers can open a hybrid investment-cash management account. The broker does require a fairly significant $25,000 to do so, however. The account comes with checks and a Visa debit card, courtesy of UMB Bank. There is no charge for these banking tools, which is a nice policy because Firstrade used to charge for them. While the Visa card can be used worldwide, there is a 3% fee for transactions that occur outside the U.S. There is no annual fee for the account, and securities can be traded in it.


Firstrade Review: Pros


Firstrade’s new commission schedule places it as one of the cheapest online brokers today. At $2.95, its trading fee is lower than WellsTrade ($5.95), Fidelity ($4.95), and TD Ameritrade ($6.95). Its option commission is also one of the lowest in the industry.

The trade bar on the Firstrade website is very user-friendly and provides many more usable functions than the trade bars of other brokers. Vanguard doesn’t even have one.

Firstrade has a 0.1 second execution guarantee for S&P 500 equity market orders. If an order takes longer than a tenth of a second to fill, the commission is waived.

The brokerage house has several on-going promotions. These offer free trades and cash bonuses that start with just a $2,000 deposit. Other specials include rebates on wire transfer and account transfer fees. There are also bonuses for referring new customers to Firstrade.

Firstrade’s online chat service is consistent and helpful. Other brokers, including Vanguard, TIAA, and Robinhood, don’t offer the service at all.


Firstrade Review: Cons


Firstrade has no weekend customer service hours. Combined with no weeknight hours, this broker doesn’t do a sufficient job of taking care of the customer. Other brokers provide 24/7 phone service. These companies include Merrill Edge, Schwab, and WellsTrade. Firstrade also has no branch locations, whereas E*Trade has thirty.

The mutual fund selection at Firstrade is rather small. WellsTrade, for instance, offers more funds. Furthermore, Firstrade’s policy of not offering any products that are both no-load and no-transaction-fee is rather disappointing. Many broker-dealers do offer funds that carry neither load nor transaction fee. TD Ameritrade, for example, has more than 2,000.

The lack of a desktop trading platform is a big disadvantage when other brokers do have one at some price. TradeStation, for example, offers both a browser-based environment and a desktop program.

Firstrade does not offer any investment advice or managed accounts, which means there is also no robo-advisory option here, either. Many brokers today do offer these financial services, including Fidelity and E*Trade.

The broker’s option chain software does not have many pre-defined strategies, like butterflies, collars, and strangles. TradeStation’s software has all of these and more.


Firstrade Review - Final Judgment


We end our Firstrade Review with recommendations. Firstrade would be good for budget-conscious traders who are looking for the best value in securities investing. Customer service is good while the broker is open. Because the company does not advertise nearly as heavily as Fidelity or Schwab, many traders simply haven’t heard of Firstrade. The broker is underrated, and more investors should take a look at it.


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Firstrade reviewed by Brokerage-Review.com on . Rating: 4



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