Firstrade Account Review: Brokerage Fees, IRA Investing, Pros and Cons, Mutual Fund Offerings
Firstrade Review - Pricing
- Stocks/ETFs: $4.95 per trade
- Options: $4.95 plus $0.65 per contract for market and limit orders
- Mutual funds: $9.95 no-load funds, $0 load funds
- Bonds: net yield basis
- CDs: $30 for primary market CDs, net yield basis for secondary market CDs
Firstrade Important Fees and Surcharges
- Extended hours surcharge: $0
- Large order surcharge: $0
- Penny stocks surcharge: 0.5 cent per share
- Short term redemption fee: $19.95 will be applied to redemptions of no-load fund shares held less than 90 days
- IRA setup fee: $0
- Annual IRA fee: $0
- Maintenance fee: $0
- Inactivity fee: $0
- Option assignment and exercise fee: $16.95
Firstrade Account Advantages
- Well designed website
- $0 minimum to open an account
- Great mutual funds pricing
- 11,000+ mutual funds and fixed income investments
- No annual or setup fees for IRA accounts
- Free dividend reinvestment
Firstrade Account Disadvantages
- Basic trading tools
- Surcharge of 1/2 cent per share for stocks under $1
- Customer service complains
- Short Term Redemption Fee of $19.95 will be applied to redemptions of no-load fund shares held less than 90 days
Firstrade Account Types
- General Investing Account
- Joint WROS
- Asset Management Account
- Firstrade Smart Account
- Retirement & Educational Accounts
- Rollover IRA
- Roth IRA
- SIMPLE IRA
- Coverdell ESA
Mutual and Exchange-traded Funds
Firstrade gives it clients 12 ETF’s from iShares, Vanguard, and PowerShares that are commission-free. Traders are required to purchase at least 10 shares, and the shares must be held a minimum of one month.
The broker has more than 8,000 mutual funds for its clients, some of which come with no transaction fee. Load funds always have no transaction fee. No-load funds that do have a transaction fee are $9.95 to trade. Some funds are completely free to trade, carrying neither load nor transaction fee. Strangely, Firstrade's screener lacks the ability to search for NTF mutual funds.
A $19.95 fee is applied to redemptions of fund shares that are held less than 3 months. Furthermore, fund redemptions under $500 are charged a $19.95 fee, unless the entire value of the fund is under $500.
Research and Education Tools
The broker needs to improve its research capability. Firstrade pulls data from Morningstar, and offers Morningstar reports for some securities. There are no other third-party
reports available besides Morningstar publications. This pales in comparison to Fidelity and
TD Ameritrade, which provide their clients with reports from several independent analysts, such as S&P Capital IQ and TheStreet.com.
Firstrade does have some decent educational resources. The broker offers its clients several important learning tools on a page of their website called Education Center. Here investors will find videos and articles on a variety of securities topics, such as ETF basics and how to use a stop loss order. The broker also provides market news from Zacks and Benzinga.
The brokerage firm provides its customers with some useful tools on retirement and education planning. On the web site, clients can find important information on education savings accounts and IRA's.
Firstrade representative can be reached by phone, fax, an on-line chat system, e-mail, or snail mail. Regrettably, chat and phone service are only available during the weekday.
Unlike Scottrade and TD Ameritrade, Firstrade does not have a national network of brick-and-mortar branches to help customers who want some personal guidance. However, Firstrade does hold office hours during the weekday and on Saturday at their headquarters in Flushing, New York.
Website and Trading Tools
Firstrade’s web site is user friendly and easy to navigate. Traders can place orders for a variety of securities using the standard web browser. At the bottom of the browser is a handy trade ticket called the Quick Bar where users can swiftly trade stocks, ETF's, and options. The Quick Bar displays vital information, such as the day's volume and the last trade price. Option chain information is also available using the Quick Bar.
Disappointingly, a desktop trading platform isn't available at Firstrade. Other brokers, such as Charles Schwab and
Etrade, do offer advanced platforms. Firstrade does have a proprietary streaming quote service called X-Stream, although most buttons simply take the user back to the web site.
Firstrade offers mobile apps for Android and Apple. The interface is intuitive and simple to use. Traders can call customer service, place a stock or option order, and look over position and account data. Regrettably, many features are lacking, such as mobile check deposit and the ability to trade mutual funds. Other brokers, such as Schwab and Fidelity, offer those services on their mobile platforms.
Cash Management Account
Firstrade offers its clients a Cash Management Account (CMA). A very steep $25,000 account balance is required, however. To qualify for a Visa debit card, traders must have at least a $50,000 account balance. Checks and the debit card don't come cheap either, as both have steep fees: $30 for checks, and $45 for the debit card.
Customers who open a new Firstrade account are eligible to receive 30 days of free trades when they deposit $3,000 or more. Clients who can deposit at least $10,000 will also receive a $100 bonus.
The promotion link is
Open an account now to get 100 free trades.
Firstrade will rebate ACAT fees charged by another broker, up to $100, for customers who complete an account transfer of $10,000 or more in assets. This promotion is on-going.
Firstrade Review Summary
Firstrade has some flaws, but nevertheless delivers reliable securities trading at low cost that some investors will find attractive. Stock and option traders can do well here. Investors who need cash management features or advanced trading software will be better served somewhere else.
Firstrade Promotion Offer
Open an account now to get 100 free trades.
reviewed by Savings-Secrets.com on