TradeKing vs Scottrade: Broker Showdown

Broker ShowdownIn its 2012 annual review, Barron’s considered 27 online brokers for its evaluation process. The firms were evaluated across eight parameters. TradeKing and Scottrade are two of those firms. In this article we’ll perform a comparative analysis of the two firms based on Barron’s observations.

TradeKing

TradeKing was awarded four stars in the review. It has a very active community of traders and their customer service is pretty good. Even the CEO of TradeKing is easily accessible.

According to the points awarded in the parameter of research amenities (4.4), it would seem that TradeKing is doing well there. It has got a great browser based platform which is highly customizable.
Barron’s also feels that TradeKing is a good choice for options traders.

However, they don’t yet have a strong mobile presence though apps can be expected later this year. TradeKing was one of the first brokerage firms to connect its users through an online network. It is a great place for novice brokers to start.

See current promotions from TradeKing here.

Scottrade

Scottrade has been awarded 3 stars by Barron’s review. Scottrade has a large number of branches (over 500 in the US alone). That allows them to have a very responsive customer service. So it is a great firm if you want some personal attention.

Their fees are pretty reasonable. They have a strong focus on providing research amenities and customer education services. They use a separate platform to provide advanced tools to options traders. Their general platform is pretty basic.

What goes in the favour of Scottrade is the level of personalized attention it can give to each customer with over 500 branches spread throughout USA. Investors have access to stocks from over 20 countries.

Scottrade also provides good support to novice traders. With over 30 years of delivering high quality customer experience, Scottrade can be said to be a pedigree brokerage firm.

See all available promotions from Scottrade here.

Cost comparison

* TradeKing charges $4.95 a trade for equity trading, be it an unassisted or broker assisted trade. For equity trading, Scottrade charges $7 a trade, $17 for a phone system and $27 for a broker assisted trade.
* For options trading TradeKing charges $4.95 a trade in addition to $0.65 per contract. Scottrade charges $7 per trade in addition to $1.25 per contract.
* For mutual funds trading, TradeKing charges $14.95 as opposed to $17 charged by Scottrade.
* It costs $500 to open up a cash account and $2000 to open up a margin account with Scottrade while it costs $0 to open up an account with TradeKing.
It is apparent that TradeKing is a much cheaper option than Scottrade, although casual traders must be careful of hidden costs, which TradeKing is infamous for. Scottrade on the other hand has no hidden costs.

Comparative analysis

Scottrade is not as attractively priced as TradeKing but is still better priced than most other top tier online brokerages. Both TradeKing and Scottrade provide good support to novice traders and have easy to use platforms.

Scottrade is a much more established firm than TradeKing and offers thousands of free mutual funds. Hence it is a good choice for investors looking to invest in mutual funds.

Scottrade provides an advantage to high volume traders who are used to proprietary trading platforms such as those that were in use before the advent of the internet.

Scottrade is also a good choice for opening up retirement accounts. TradeKing is a great choice for novice investors, active traders and option traders.

In the end, it’s up to what suits YOUR personal needs, so if you’re still shopping around, feel free to check out even more of our online brokerage reviews and be sure to grab a promotion code after you make your pick.

Leave a Reply

Your email address will not be published. Required fields are marked *