There are dozens of available brokerages that investors can choose from, and today I’d like to review Scottrade.
Scottrade is a privately owned retail brokerage firm headquartered in Town and Country, Missouri. The company operates 503 branch offices around the U.S and employs nearly 4,000 employees, all of which reside in the United States. (see more at Wiki)
In addition to being full service, the company has won awards for outstanding customer service and customer satisfaction through the J. D. Power and Associates’ Online Investor Satisfaction Study. Scottrade has also been ranked in Fortune’s annual “100 Best Companies to Work For” each of the last 6 years.
Scottrade is primarily an online brokerage firm, and the pricing is middle of the road. There are lower cost brokerages offering similar services, but there are also more expensive options. Here is the schedule of fees from the Scottrade site:
Stocks and ETFs: flat $7.00 per trade
Options: $7.00 per trade + $1.25 per contract
Trading Platforms: Free
Multiple Account Options: You can easily open single or joint accounts online in minutes. In addition, you can quickly setup a Traditional IRA, Roth IRA, SEP IRA, Rollover IRA, etc. You can even open up business and trust accounts.
Open Pricing: The fees are openly disclosed and there aren’t many to mention with Scottrade. As I said, most trades are a flat $7 and the minimum to open an account is $500, which is quite low. There are no inactivity fees or other ridiculous charges that I have found.
Easy Trading Platform: Scottrade offers a relatively simple trading platform that allows simplified trading of securities. They offer a more advanced Scottrade Elite platform for members who have $25,000 or more in their account.
Mobile Support: Scottrade has a great platform for mobile devices like smartphones and tablets. If you have internet access you can trade, check updates, and real time news streams directly to your mobile device. I haven’t tried this, but supposedly it is quite good.
Customer Service: Scottrade has more than 500 offices in the U.S. This allows great support and easy access. If you have a question about the service or a product, you can chat with a live person for free. They are genuinely helpful and this is the main reason why many choose Scottrade over the competition.
Trading Tools: Scottrade does offer basic research and trading tools that are available for free. It’s not the most advanced options but you do have access to stock screeners and other tools for research purposes. If you have $25,000 or more in your account, you have access to more advanced trading tools, but I manage fine without them.
Educational Resources: In combination with local offices that offer support, they have an extensive online library which is designed to help novice investors understand the process and the terminology. If you are new to investing, this could be valuable.
Flexible Reinvestment Program: Scottrade used to offer no dividend reinvestment program, but that has changed. They now offer their version which enables investors to collect their dividends and reinvest them, commission-free, into up to five eligible stocks or ETFs at a time, including securities that didn’t generate the dividends.
Scottrade Review Summary
Scottrade is competing with a lot of other brokerage firms, so you have a variety of options available to you.
I don’t think the features justify the fees charged by Scottrade. You can find more investment options and innovation through Motif Investing.