Tornado Invest Review
2024 Tornado brokerage review: trading platform, account fees, and investing app pricing.
Is Tornado a safe, insured, and legitimate company or a scam?
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Review of Tornado Investing
Tornado is a brokerage firm that brings some fresh ideas to trading and investing. It has its strengths, but there are also some drawbacks worth noting.
Tornado Investing Pricing
| Investments | Commissions |
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| Stocks and ETFs |
Membership costs $4.00 per month, which includes up to 20
trades per month; $4.50 per trade after that
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| Options | not offered |
| Mutual funds | not offered |
| Investments | stocks, ETFs, closed-end funds |
| Minimum deposit to open account | $0 |
Tornado Invest Pros...
Unique investing method. You won’t find Bollinger Bands here.
Helpful website. The broker’s only trading platform delivers a lot of useful features.
Simulated trading. It’s possible to try out the broker’s tools before opening a live account.
Tornado Invest Cons...
Commission schedule is not competitive. Tornado is one of the few brokerage firms left that still
charges subscription and trading fees.
Customer support leaves a lot to be desired. Most support channels are not available.
Many investment vehicles can’t be traded. Don’t bother asking about mutual funds, bonds, forex, precious metals, or futures.
Opening an Account
Tornado offers two account types: simulated and live. The simulated account lets you explore the broker's features, while the live account lets you trade with real money.
Opening a demo account is simple—just provide your name and email, and set up a password.
On the setup screen, you'll choose from investment categories like dividend stocks or diversified ETFs, which will then list options like GE, Ford, and Coca-Cola.
Insurance and Regulation
Tornado is registered with SIPC and FINRA since 2016 and has no disclosures, which is promising.
Through SIPC, each customer is insured up to $500,000. Tornado also has extra coverage through Lloyd's of London for up to $37.5 million per customer, with a total firm limit of $150 million.
Style of Investing at Tornado
Tornado uses a social networking approach to investment, tracking the buying and selling activities of others instead of traditional technical or fundamental analysis.
You can view the portfolios of professional money managers as well as everyday investors. You can also contact Tornado's investment professionals for advice on specific stocks.
Tornado also allows customers to post short statements about specific securities, which others can agree or disagree with. This fosters a community environment where you can also see other traders' investment performance and strategies.
Customer Support
Tornado's customer support is limited mostly to FAQs on their website. Direct contact options are minimal, and there are no physical branches or advanced online support features.
Price Schedule
Tornado's trading costs include a $4 monthly fee for up to 20 trades, with each additional trade costing $4.50. Other fees include $5 for paper statements and $5 for tax statements, with a 6.50% rate on margin loans across all balances.
Website
Tornado’s website is the main platform for trading, as there is no desktop program. It's designed to be user-friendly with a menu that simplifies navigation. Features like the dashboard and "top performers" list provide useful starting points for trading.
Tornado's stock research tools are minimal, focusing more on social inputs than traditional analytical tools. The trade ticket is straightforward but limited to basic order types.
Funds
Tornado allows trading in ETFs and closed-end funds, with fund profiles similar to those of stocks but without detailed analyst commentary or a traditional screener. Most popular fund trades include EEM, EFA, and SPY, though popularity can vary.
Investment Education and Research
Tornado eschews traditional stock reports in favor of a social networking approach, discussing market trends and what other traders are buying or selling. Stock profiles include basic company and financial data, and members have access to professional-quality data from Capital IQ at no extra cost.
Other Services
Tornado lacks traditional banking and portfolio management services, offering a very basic approach to trading without the usual support tools.
Comparison
Tornado's reliance on social trading is unusual but may not suit everyone, especially with the availability of free trading at other firms. The emphasis on amateur opinions over professional analysis is a significant departure from traditional brokerage services.
Recommendations
Mutual Fund Investors: Consider
Firstrade instead.
Individual Retirement Accounts:
Robinhood may offer a better deal due to Tornado's fee structure.
Beginners: Tornado's platform may be too complex for new traders.
Charles Schwab is more beginner-friendly.
Active Stock and ETF Trading: Tornado is not ideal for frequent trading. Consider
Webull instead.
Long-Term Investors and Retirement Savers:
Charles Schwab offers a more comprehensive range of services and investments.
Tornado Invest Review Summary
Tornado's unique social investing model costs $48 annually. This review should help you decide if it's the right choice for you.
Updated on 7/19/2024.
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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